Input expenses to constrain minesComment on this story
Rising input costs were among the threats to mining growth, analysts predicted as Statistics SA reported yesterday that year-on-year growth in mining output softened to 5.1 percent in November last year from 23 percent in October.
Stats SA said the gold sector led the increase as it grew by 35.5 percent, while manganese output grew by 33.6 percent and diamonds by 27 percent.
On a seasonally adjusted basis, mining production shrank by 2.9 percent month on month in November after posting 7.4 percent growth in October.
“The risks remain that such gains will be eroded by rising employment costs, and lost production, in the event of prolonged strike action,” Investec analyst Kamilla Kaplan said yesterday.
“Currently, labour unrest prevails across the platinum mines, with strike action at Impala Platinum, Anglo American Platinum and Lonmin unlikely to be averted.”
Global economic uncertainty was a key contributing factor to the performance of the mining sector, Kaplan added.
Nedbank’s economic unit said the subdued output trend would remain, “constrained by moderate growth prospects globally, while domestic factors such as rising production costs will also have a negative impact”. – Dineo Faku