Mining production falls much further than expected, in bad sign for GDP
Gold production fell 18% and diamond output was down almost 25%
SA’s mining production fell 8.4% in March from the same month in 2017, far more than a 2.6% drop forecast by a poll of economists done by Trading Economics.
In addition to March’s drop, February’s mining output growth was revised down, to 2% from the previously reported 3.1%, by Statistics SA on Thursday.
Stats SA reported a seasonally adjusted drop in mining production for the March quarter of 2.5% — a bad omen for the first-quarter gross domestic product (GDP) figure.
Gold production fell 18%, contributing a 2.5 percentage point drop to the total.
Platinum group metal production fell 6.1%, contributing a 1.5 percentage point drop. Diamond production fell 24.7%, contributing a 1.2 percentage point drop. Iron ore production fell 8.9%, contributing a 1.2 percentage point drop.
Investec economist Laura Hodes said in her weekly note e-mailed on Friday that the mining sector could improve in the months ahead thanks to robust global growth and stronger commodity prices.