Good to see the likes of Newcrest coming clean with real all in production costs at Lihir, and another asset write down More to follow for sure. from them as well as the others who are battling through at these prices. You do not have to go to the World Gold Council to figure out what is happening, look at the books of the major gold miners. What do you think is going to happen to gold production in refridegrated mines 2 kms plus deep....goodluck guys.
The grade of gold mined has declined, a fact well presented by numerous experts, and you can do your own research.
Have a look at the excellent presentation at
http://www.minexconsulting.com/publications.html
The grade of gold found has declined, again well documented. When you try and find gold deposits buried under the regolith, you have to go for the big ones, as the high grade are generally smaller, and more difficult (costlier, takes more time)....
The mining supply side is in short and long term decline at these prices, and the discoveries of the future that feed mines of the future is not being done...A reality check is coming, and I would not want to be "holding the parcel"
Daytr
There is too much speculation and here say in this conversation. So I went and looked up some industry data for a reality check.
http://www.gold.org/sites/default/files/GDT_Q1_2014v5.pdf
According to the World Gold Council, demand slightly down, year-on-year and supply slightly up. But these shifts aren't statistically significant. That is entirely consistent with the sideways, range bound market that we are currently stuck in, and doesn't point to an imbalance that might produce a sudden sharp rally.
Afterthought: My every instinct screams at me to distrust the WGC. Surely an industry peek body with a mandate to promote gold is going to dodgy up the numbers and skew the analysis! If they do rig their numbers, I can't pick it and accepting natural gaps, (banks will never disclose position information), their analysis seems consistent with the data, rather than the interests of their obvious constituents.