Spiraling Costs to Badly Impact Gold Mining Industry

SEATTLE (Scrap Monster): The top executives of gold mining companies attending the Denver Gold Forum held this week expect cost pressure to cause troubles to gold mining industry into 2023. The threat comes on top of challenged posed by economic and political unrests across the world, supply-chain constraints and rising interest rates.

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The participants expressed deep concerns over the gold prices and trading levels of gold equities. The near-term outlook continues to remain challenging, especially due to strength in dollar, they noted. The decades-high inflation rate was mainly the outcome of Covid-19 pandemic effects and the impacts of the Russia-Ukraine war. The supply chain issues that have added cost pressure are likely to linger, top mining executives said.

Tom Palmer, CEO, Newmont Corporation highlighted the fact that the entire global economy is passing through a volatile environment. The cost inflation in labor, energy, fuel, materials and consumables will likely continue into the better part of 2023.

Chris Griffith, COE, South Africa-based Gold Fields Ltd. noted that rising costs are plaguing mining companies and their operations around the world. Although fuel prices have cooled off, other key mining components such as explosives and reagents have not come down yet. The high inflation levels are likely to remain at high levels for a significant period of time, Griffith added.