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Business News of Friday, 18 October 2019

Source: goldstreetbusiness.com

Ghana’s gold production highest in 3 decades


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The summation of gold derived from both large-scale and small-scale producers indicate that the quantum of gold produced in Ghana increased by 12 percent last year, from 4.287 million ounces in 2017 to 4.795 million ounces in 2018.

This is the highest level of output in more than three decades.

While gold production from the large-scale mining sector declined marginally from 2.808 million ounces in 2017 to 2.807 million ounces in 2018, the quantum of locally sourced gold assayed by the Precious Minerals Marketing Company (PMMC), on behalf of the Licensed Gold Exporting Companies (LGECs) – which effectively are the licensed small scale producers – rather saw a significant increase as it recorded 1.987 million ounces in 2017 up from 1.479 million ounces in 2017.

Government placed a ban on all forms of small-scale mining activities in 2017 which was lifted in December 2018 when an Inter-Ministerial Committee on Illegal Mining successfully developed a comprehensive policy framework to regularize small-scale mining across the country.

This implies that gold production from the small scale mining sector should not have recorded any figure since there was a ban in place. However, the Ghana Chamber of Mines has reasoned that the volume of gold assayed by PMMC was primarily from LGECs engaged in trans-shipment of gold produced from outside Ghana to foreign buyers. This indicates that the firms acted as agents in transporting gold produced in other countries to a final buyer who is usually a non-resident entity. This suggests that a significant quantity of gold recorded as deriving from Ghana might not have been actually produced in Ghana after all.

Meanwhile, the proceeds from the country’s total exports of mineral receipts declined by 3.7 percent last year from US$6.004 billion in 2017 to US$5.779 billion in 2018, data indicates.

The drop in receipts from mineral exports in 2018 is attributed largely to the simultaneous falls in the export values of gold, diamond and bauxite which outweighed the expansion in the value of manganese shipments.

Earnings from gold in 2018 saw a drop from the US$5.786 billion generated in 2017 to earnings of US$5.461 billion last year, representing a contraction of 5.6 percent.

Similarly, receipts from the sale of diamonds and bauxite saw contractions of 32.3 percent and 53.7 percent respectively in 2018. Conversely though, proceeds from the export of manganese increased by 77.9 percent, from US$164.51 million in 2017 to US$292.71 million in 2018.

Despite the overall decline in export earnings, the minerals sector retained its position as the leading source of foreign exchange in 2018 as the sector’s share of the total merchandise exports receipts was 39 percent, which was considerably higher than the contributions of cocoa and crude oil.

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