Going for Gold – The year in review
As we welcome another year for the mining industry, it’s time to reflect on the past and consider future possibilities.
The financial year kicked off with the annual Diggers and Dealers event in August, returning to its usual slot. It drew one of the largest crowds, even without interstate or international travellers due to WA’s COVID restrictions. The event turned into a WA beat the drum fest, with gold dominating discussions.
Attendees and miners were upbeat. Presentations from Northern Star, Westgold, and Gold Road boosted confidence, showing we emerged from the pandemic strong and ready for a promising year.
Politics and Economics
But then another wave hit. Companies maintained a cautious working-from-home approach, even as the McGowan government welcomed full crowds back to the RIU conference. The lingering effects of long COVID on the world economy began to surface, revealing escalating supply chain issues, labour shortages, and rising inflation. Banks warned of a looming recession impacting our metals. News of an economic slowdown in the US and possible recession in Europe raised concerns about steep declines in industrial metal prices over the next six to nine months.
Commodities
Despite this, there’s a more optimistic outlook for commodities. Gold, in particular, may find solid support as recession fears grow. “Central bank purchases (of gold) are likely to be strong as currencies depreciate and geopolitical risks rise,” says ANZ.
Evolution Mining’s Jake Klein echoed this at Diggers & Dealers 2022, forecasting gold prices could reach between $2,000 and $3,000 an ounce within a year. Argonaut suggested that gold producers could reap benefits from current market conditions. Even though June saw a surge in exploration spending, advanced explorers remained vulnerable. Yet, aggressive strategies might allow them to consolidate and grow their project portfolios.
Many presenters at D&D22 expressed optimism about the labour shortage crisis. With the right culture and the allure of de-carbonisation metals for new generations, hiring should not be a major obstacle.
We face an exciting year ahead, marked by volatility as we adjust to new COVID variants. Global economies are rising from their recessions while governments seek to curb inflation. Market leaders in industrial metals are re-emerging, and new commodities are staking their claim in the battery metals arena. And, of course, gold remains a safe haven.
It is going to be interesting to be a part of this industry that is mining.
