Mining production contracted by 2.7% y/y in November

According to Statistics South Africa’s (Stats SA’s) production results for November, coal production decreased by 7.9% and contributed negative 2.1 percentage points, while iron-ore production decreased by 7.6% and contributed negative 1.1 percentage points.

PGM production decreased by 2.8% and contributed negative 0.8 of a percentage point, and gold decreased by 6% and contributed negative 0.5 of a percentage point.

Financial services firm Investec points out that six of the twelve categories included in the mining basket declined when compared with November 2024.

The company notes that the largest negative contributor was coal, which makes up a notable 26.3% of the mining basket.

Investec says weather-related factors, aging mines, logistical shortcomings and elevated operational costs remain key challenges for domestic mining operations.

It explains that, according to the Minerals Council South Africa, a number of significant cost pressures continued to weigh on the energy intensive mining sector in November, such as electricity costs that jumped 15.9% year-on-year, while water costs increased by 11.6% year-on-year, “both remaining significant contributors to operational inflation”.

Meanwhile, Stats SA notes that manganese ore was the largest positive contributor during the period, with production having increased by 17% and contributing 1.1 percentage points.

Seasonally adjusted mining production decreased by 5.9% month-on-month in November, following month-on-month changes of 2.7% in October and 2% in September.

Stats SA notes that seasonally adjusted mining production increased by 1.6% in the three months ended November, compared with the previous three months, with the largest positive contributors having been PGMs, iron-ore and manganese ore.

PGM production for the period increased by 3.8%, contributing one percentage point, while iron-ore output increased by 5.7% and contributed 0.9 of a percentage point.

Additionally, manganese ore production increased by 6.5%, contributing 0.5 of a percentage point.

Meanwhile, Stats SA reports that mineral sales at current prices decreased by 0.3% year-on-year in November, with the largest negative contributors having been gold, coal and iron-ore.

Gold sales decreased by 27.9%, contributing negative six percentage points, while coal decreased by 15% and contributed negative 3.8 percentage points. Iron-ore decreased by 16.6% and contributed negative 1.7 percentage points.

Stats SA notes that the largest positive contributor was PGMs at 42.3% and contributing 9.7 percentage points.

Moreover, Stats SA reports that seasonally adjusted mineral sales at current prices decreased by 2.4% in November, compared with October. This followed month-on-month changes of -0.9% in October and 7.9% in September.

Seasonally adjusted mineral sales at current prices increased by 7.7% in the three months ended November, compared with the previous three months.