Pick up in Au­gust

But sec­tor still un­der pres­sure

Finweek English Edition - - Economic Trends & Analysis - GRETA STEYN gre­tas@fin­week.co.za

THE PHYS­I­CAL VOL­UME of min­ing pro­duc­tion rose sharply mon­thon-month in Au­gust on a sea­son­ally ad­justed ba­sis af­ter fall­ing sharply mon­thon-month in July. The sec­tor re­mains un­der pres­sure and a re­peat of its mas­sive con­tri­bu­tion to gross do­mes­tic prod­uct in the sec­ond quar­ter won’t hap­pen in the third quar­ter.

The July min­ing out­put fig­ures were par­tic­u­larly dis­mal due to weak per­for­mance by platinum group met­als (PGMs). That im­proved in Au­gust, but wasn’t enough to save min­ing out­put from a year-on-year de­cline. To­tal min­ing pro­duc­tion de­creased 6% (year-on-year, sea­son­ally ad­justed) dur­ing Au­gust, less than the 12,4% year-on-year re­duc­tion in July.

Ef­fi­cient Group econ­o­mist Fanie Jou­bert says a re­bound in the pro­duc­tion of PGMs sup­ported min­ing pro­duc­tion in Au­gust. PGM out­put still fell by 1% year-on-year in Au­gust, but that was a se­ri­ous im­prove­ment af­ter the 32,2% con­trac­tion in July, when de­ferred main- ten­ance af­fected the sub-sec­tor ad­versely.

Gold (-23,2%), coal (-0,6%) and di­a­monds (-27,1%) all recorded con­trac­tions dur­ing Au­gust.

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