JOHANNESBURG, June 13 (ANA) - The contraction in mining production had deepened slightly in April to 1.5 percent year-on-year following March's 0.7 percent year-on-year decline, Statistics South Africa (StatsSA) said on Thursday.
">But this was markedly less severe than February's reading which saw production levels plunge by 8.1 percent compared to the same period last year.
">The performance of the gold sector continued to plague overall mining industry production as gold was the largest negative contributor at 19.5 percent, underpinned in part by a five-month strike at the gold operations of Sibanye-Stillwater, which ended mid-April.
">Lara Hodes, Investec Bank economist, said that South African gold mines were typically old and deep and continued to struggle with dwindling grades and productivity.
">The gold sector constitutes a marked 16 percent of the mining basket and fell by 19.5 percent year-on-year in April, in turn detracting 2.7 percent from the headline number.
">Iron ore production also waned notably, falling by 11.7 percent year-on-year in April thereby reducing the top line reading by 1.7 percent.
">The World Bank is anticipating metal prices to continue rebounding from their 2018 troughs.
">Hodes said the softening in global growth and the prolonged uncertainty around the US-China trade agreement was expected to weigh on metals prices.
">"Aside from these external considerations, the domestic mining sector continues to face ongoing challenges, undermining its ability to operate efficiently and profitably," she said.
">"Trepidation around security of land tenure, climbing administered prices and other costs, including the imposition of a carbon tax in June, combined with electricity supply concerns weigh heavily on the sector, with Eskom a significant risk to the future sustainability of SA's mining industry."
">- African News Agency (ANA)
