Unlike the ongoing downramping by CUB and the conjoined twins -...

Unlike the ongoing downramping by CUB and the conjoined twins - one of whom posted a message yesterday prompting CUB to deliver his latest negative sermon - this story on **promotion blocked** is imo well worth a read. No doubt the troika will mock it's significance to RXL, but I'm sure we're all capable and experienced enough to make up our own minds ... as of course are Hawke's Point, who have already successfully backed other Aussie juniors.

Analysts warn of ‘peak gold’ by 2026, say junior minersare the answer.

(**promotion blocked** News) – Gold has shined bright in 2024 as risingdemand from central banks and retail investors has pushed the yellow metal tomultiple new record highs, and it could potentially continue to see itsfortunes rise for years to come as one analyst warns that the gold supply is atrisk due to scarce and smaller gold discoveries.

According to a reportfrom S&P Global analyst Paul Manalo, there have only been five major golddiscoveries since 2020, totaling 17 Moz of gold.

S&P’s annual analysis of major gold discoveries foundthat there were 350 deposits discovered between 1990 and 2023, containing 2.9billion ounces of gold in reserves, resources and past production. A major golddiscovery is one defined as one containing at least 2 million ounces inreserves, resources, and past production.

“While the number of major discoveries and the totalamount of gold continue to grow each year, it is important to note that most ofthe assets added to the list were discovered decades ago and only recently metthe criteria of having at least 2 million ounces of gold in reserves, resourcesand past production,” wrote Manalo. “Since 2020, there have been only fivemajor discoveries with a total of 17 Moz of gold, accounting for just 22% ofthe additional 79 Moz of gold added in the 2024 update.”

Manalo said the recent discoveries “are scarce andsmaller in size, with an average of 3.5 Moz compared to the 5.5 Moz averagefrom 2010 to 2019. None of the discoveries made in the last 10 years haveentered the list of the largest 30 gold discoveries, supporting our long-heldview that the decade-long focus on older and known deposits limits the chanceof finding huge discoveries in early-stage prospects.”

“It is important to note that while recent significantdiscoveries are sparse, reserves and resources grow over time, and there isstill potential for growth in these recent discoveries,” he added.

That said, Manalo warned that “The lack of qualitydiscoveries in the recent decade does not bode well for the gold supply.”

“Based on the latest monthly Gold Commodity BriefingService, we expect gold supply to peak in 2026 at 110 Moz., driven by increasedproduction in Australia, Canada, and the U.S. – countries that also account formost discovered gold,” he said. “Gold supply is expected to fall to 103 Moz in2028, resulting from a decline in supply from these countries.”

Manalo added that between 2017 and 2023, the higherbudgets resulted in “an average of 42 announcements with an average of 24 Mozof gold each year, compared to an average of 30 announcements and 13 Moz ofgold from 2013 to 2016, when gold budgets were declining.”

“The future of gold supply is a mixed bag. The focus onold and existing assets has taken a toll on the number and size of discoveriesin recent years, as proven by the lack of substantial discoveries in the lastdecade,” he concluded. “However, the increasing gold budgets since 2017 bring atad of optimism for the future of gold supply, as the number of initialresource announcements continue to grow in size and number.”

Commenting on Manalo’s analysis, Ahead of the Heardeditor Rick Mills warned:“Peak gold it’s already here.”

“In a world of resource depletion, it falls to goldexploration companies to fill the gap with new deposits that can deliver thekind of production required to meet gold demand, which is currently out-runningsupply,” he added. “The gold market continues to experience tightness due todifficulties expanding existing deposits and a pronounced lack of largediscoveries in recent years.”

There is some hope that supply will increase, he noted,as S&P has “Identified 176 initial resource announcements with a total of79 Moz of contained gold” after examining various prospectusannouncements.

“Only 78, or 44%, of these announcements are fromgreenfield assets, while the rest are from newly discovered deposits withinexisting projects, demonstrating the industry’s preference for exploring knownassets,” he said. “While not all of these assets will become major discoveries,the increasing number of announcements in recent years brings much-neededoptimism to an industry that has experienced fewer and smallerdiscoveries.”

Manalo suggested that the rising price of gold could helpchange this outlook, as it allows annual gold exploration budgets to continueto increase.

“Since 2017, annual gold exploration budgets have morethan doubled, reaching a peak of $7 billion in 2022 after a low of $3.3 billionin 2016,” he noted. “Although budges fell in 2023 due to tighter financingconditions, they remain elevated compared to previous years. This trend islikely to continue as long as gold prices remain high.”

“In 2023, 4,448 tonnes of gold demand minus 3,644t ofgold mine production left a deficit of 804t,” Mills noted. “Only by recycling1,237t of gold jewelry could the demand be met. (The World Gold Council: ‘GoldDemand Trends Full Year 2023’).”

“This is our definition of peak gold,” he said. “Will thegold mining industry be able to produce, or discover, enough gold so that it’sable to meet demand without having to recycle jewelry? If the numbers reflectthat, peak gold would be debunked. We’ve been tracking it since 2019, and ithasn’t happened yet.”

After listing off several factors contributing to hisnegative outlook, including the escalating economic battle between the U.S. andChina via tariffs, Mills said, “The situation is dire, and it starts withmining.”

“The S&P report is misleading in that it shows thatmajor mining companies are exploring for more gold, but they are doing it ontheir own properties, sometimes mining around the edges of deposits discovereddecades ago,” he noted. “They are doing nothing to go out and find new mines,but that has never been a major’s job. It’s the job of juniors to discover newmineral deposits, but they are not being financed; they literally have no moneyand are conducting financings at 5-10 cents, thus blowing out their sharestructures.”

“Right now, the industry’s solution is to go pokingaround their own brownfield projects to find more metal to mine,” he added.“It’s a far cry from what we are going to need. It is elemental to the miningindustry that the juniors are well financed, [and for] deposits [to] have ashortened path to production, say five years like in Scandinavia, versus up to28 in the US. Juniors need to be out in the bush making discoveries.”

Mills said that “only with the help of juniors can miningsolve its existential problem of getting the resources that are currently ownedby its adversaries. Junior resource companies find the resources miners thenbuy and turn into their mineable reserves.”

“In fact, I don’t think it’s much of a stretch to saythat without financed juniors, without a safe and secure supply of metals,without security of supply, without refineries and smelters, and without thetechnological knowledge to manufacture magnets and anodes, the developedeconomies of the western world are very much at risk if supplies of thesecritical metals, and associated technologies, come from our competitors,” heconcluded.