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5 Top Gold-producing Countries 5 Top Gold-producing Countries

The last year was an eventful one for the gold price. According to the most recent data from the US Geological Survey (USGS), the gold price rose about 9 percent year-on-year, while the Engelhard daily gold price fluctuated through several cycles. Read on to learn more about the top gold-producing countries of the last year, based on the most recent numbers reported by the USGS. 1. China Mine ...

The last year was an eventful one for the gold price. According to the most recent data from the US Geological Survey (USGS), the gold price rose about 9 percent year-on-year, while the Engelhard daily gold price fluctuated through several cycles. Read on to learn more about the top gold-producing countries of the last year, based on the most recent numbers reported by the USGS.

1. China
Mine production: 455 MT

Once again, China was the world’s top gold-producing country with output of 455 MT. The country has now held that position for 10 years in a row.
In addition to being the top producer of gold, China is the world’s largest gold consumer, and has been for four straight years, according to the World Gold Council. That said, gold consumption in China dropped 7 percent in 2016. The drop was the result of higher gold prices and strained supply in the fourth quarter.

2. Australia
Mine production: 270 MT

Gold production in Australia took a bit of a tumble in 2016, dropping from 278 MT in 2015 to 278 MT.
That decline may have come because the country’s biggest gold producer, Newcrest Mining, reported a drop off in production in 2016. Specifically, the company noted that production from its Cadia operation was lower and said that it sold a mine in Papua New Guinea.

3. Russia
Mine production: 250 MT

Russia’s gold production held steady in 2016, but the country plans to increase output over the next decade or so; in 2016, it was reported that the country is planning to raise its annual gold production to 400 tonnes by 2030. Most of its additional gold will come from the development of local gold ore fields.
According to the USGS, Russia holds 8,000 MT of gold reserves, second only to Australia at 9,500 MT.

4. United States
Mine production: 209 MT

US gold production dipped last year, dropping from 214 MT in 2015 to 209 MT in 2016. Most of the gold in the country was produced at more than 40 lode mines, several large placer mines in Alaska and a number of smaller placer mines in the western Us.
The USGS further notes that the 26 top operations in the country were responsible for 99 percent of its gold output.

5. Canada
Mine production: 170 MT

Gold production in Canada rose noticeably in 2016. Last year, the country reported output 170 MT of gold, compared to 153 MT in 2015.
It appears as though gold production in Canada is only going to grow from hereon out. In February 2017, Agnico Eagle Mines announced plans to expand an existing gold mine and develop another one in Nunavut; they are expected to become operational in 2019.

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"This is a great step toward increasing the investment attractiveness of Ukraine" - CEO Avellana Gold on ratification of the Agreement on Trade in Canada and Ukraine

Senate of Canada ratified an agreement on free trade with Ukraine.The Senate Committee on Foreign Affairs and International Trade is confident the trade deal will benefit both countries’ economies and signal Canada’s strong, ongoing support for an emerging democracy and a longstanding partner. Free Trade Agreement Implementation Act was adopted with one accord. This is more than just a free ...

Senate of Canada ratified an agreement on free trade with Ukraine.The Senate Committee on Foreign Affairs and International Trade is confident the trade deal will benefit both countries’ economies and signal Canada’s strong, ongoing support for an emerging democracy and a longstanding partner.

Free Trade Agreement Implementation Act was adopted with one accord.

This is more than just a free trade agreement. In addition to the reduction of tariffs (Ukrainian goods entering Canada would be duty-free), it includes a clause on anti-corruption mirroring the Criminal Code of Canada, as well as environmental protection requirements. For Canadian companies, the deal will give unfettered access to a market of 45 million potential customers.

Acknowledging that the Ukrainian government is making great strides towards democracy, committee members look forward to the day when Ukrainians can enjoy the freedoms and benefits that come with living in a vibrant, thriving democracy.

The committee believes this agreement is an important signal of Canada’s commitment to openness in trade and investment and will further deepen Canadian-Ukrainian relations.

"We welcome this long-awaited decision. We also consider it a great step in increasing the investment attractiveness of Ukraine. A free trade agreement with Ukraine opens a lot of opportunities", - says Brian Savage, CEO Avellana Gold.

Experts are Most Bullish on These 5 Commodities Experts are Most Bullish on These 5 Commodities

Which commodities will do the best in 2017? The question is loaded, but mining industry experts at this year’s Vancouver Resource Investment Conference (VRIC) did their best to answer it. The majority said they are most optimistic about gold, but many also said they see silver, uranium, copper and zinc doing well this year. Economic and political unrest are expected to support the precious metal...

Which commodities will do the best in 2017? The question is loaded, but mining industry experts at this year’s Vancouver Resource Investment Conference (VRIC) did their best to answer it.
The majority said they are most optimistic about gold, but many also said they see silver, uranium, copper and zinc doing well this year. Economic and political unrest are expected to support the precious metals, while supply/demand dynamics are likely to push uranium, copper and zinc prices up.

1. Gold
As mentioned, a slew of the speakers at VRIC said they are positive on gold’s prospects this year, in part because there’s so much Trump-related instability in the world today. “Trump is still a source of instability, which markets don’t like, so this is very bullish for safe-haven assets,” said Louis James, editor of the International Speculator.
Similarly, Peter Spina, founder and president of GoldSeek, said, “Trump is bringing a whole different ball game to the entire world.” For him, that uncertainty is a sign that it’s time to buy gold. “The opportunity in this market, we haven’t seen this in a long time,” he said.

2. Silver
Silver tends to move in tandem with gold, so it’s no surprise that experts believe its prospects this year are good as well. Giustra said it’s one of the commodities he’s bullish on, and Ed Steer of GATA also made the case for investing in silver. While he believes manipulation is a major problem in the silver market, he said, “at some point in time … we’re going to see a silver price that, quite frankly, most people can’t possibly imagine”

3. Uranium
The last few years haven’t been kind to uranium, but many speakers at VRIC said they think the tide may turn this year. Giustra is one of them, and James said that probably “uranium will end the year with bigger gains than gold.”

4. Copper
Copper is another commodity that both Fulp and Calandra like. Fulp said that copper was up 17 percent last year, and is currently consolidating. “I expect that consolidation to continue for some time,” he said, also noting that he sees the metal getting a price bump down the line.

5. Zinc
In addition to gold, Lundin is optimistic about zinc in 2017. While he doesn’t see the base metal performing as well as it did last year, he thinks “we’re still going to see a very good performance.” He anticipates the metal’s price reaching $1.50 or $1.60 per pound. Calandra is also bullish on zinc, and said, “if zinc continues to do well, as it has been, some of these industrial metals that have done well — zinc, cobalt, lithium — I think will do well.”

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Zinc Time to Shine Zinc Time to Shine

Zinc was the second-best performing commodity in 2016, with a staggering 65.7% return. The greyish metal primarily used in galvanizing steel is off to a hot start in 2017, up another 12.5% to $1.30/lb. “For us zinc is still the most exciting story out there “ Don Lindsay, President and CEO, Teck (January 26, 2017) The reason for the zinc price rise is one of the basic principles of econom...

Zinc was the second-best performing commodity in 2016, with a staggering 65.7% return.
The greyish metal primarily used in galvanizing steel is off to a hot start in 2017, up another 12.5% to $1.30/lb.

“For us zinc is still the most exciting story out there “ Don Lindsay, President and CEO, Teck (January 26, 2017)

The reason for the zinc price rise is one of the basic principles of economics – supply and demand.

Zinc inventories (supply) have been falling like a rock. Inventories last February on the LME were ~500,000 tonnes and are now down to ~380,000 tonnes.

Two of the largest zinc mines in the world have closed in the last few years (Century and Lisheen) due to ore depletion, removing ~4 % of world supply.

The world’s largest mining company, Glencore, significantly helped the zinc market as well cutting production by 500,000 tonnes in late 2015. The cuts were made because of the low price of zinc at the time. Glencore has yet to restart production at these mines and this will be a major factor for investors in zinc to keep an eye on.

Zinc demand has steadily increased throughout the last several years and and is expected to increase by 2.1% to 13.85 million tonnes in 2017.

The zinc price is now at a 5 year high of $1.30 per pound as inventories are also near a 5 year low at ~380,000 tonnes (LME). Shanghai Futures Exchange stocks have also declined substantially in the last 3 years.

How high can zinc go in 2017?

As inventories continue to decrease along with no new mine supply expected, a pinch point appears to be coming for the zinc price.
“The next two years, 2016 and 2017, represent the ‘pinch point’ of concentrate supply, with mine-closure related cuts expected to outweigh new output from projects.” Wood Mackenzie Analyst, Jonathan Leng.

Zinc price forecasts

• Scotiabank is forecasting zinc prices to average $1.35/lb in 2017 and $1.55/lb in 2018.
• Wood Mackenzie, a leading research firm has a peak price target of $4000 US/tonne ($1.80 per lb) in 2018.
• Bank of Montreal has forecasted an average price of $1.50 per lb from 2017-2019.

If these forecasts are anywhere near correct, the zinc price still has tremendous upside from current levels.

The best way for investors to play a zinc price move would be to invest in zinc equities.

“I definitely think it is the right time to do so [invest in the zinc market]. About the only way to do so is through zinc equities, whether you’re looking at the major producers or some of the junior explorers there are not a lot of options out there for zinc.” Brien Lundin, editor of the Gold Newsletter

Investors have three different ways to play an investment in zinc stocks – producers, developers, and explorers.

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Gold Miners are Running Out of Metal Gold Miners are Running Out of Metal

Gold’s had a roller-coaster year, surging as much as 30 percent before giving up the bulk of those gains. But one trend has been consistent: mining companies are finding it harder to dig up more of the precious metal. Dwindling discoveries Even though producers’ exploration budgets surged more than 10-fold to $6 billion a year in the decade to 2012, new finds are in decline. The amount of go...

Gold’s had a roller-coaster year, surging as much as 30 percent before giving up the bulk of those gains. But one trend has been consistent: mining companies are finding it harder to dig up more of the precious metal.

Dwindling discoveries

Even though producers’ exploration budgets surged more than 10-fold to $6 billion a year in the decade to 2012, new finds are in decline. The amount of gold discovered last year was down 85 percent compared with 2006.

Capex cuts

To cope with bullion’s 41 percent price plunge from a record in 2011, miners have cut capital expenditure. That’s shortened the lifespans of many mines as firms haven’t been able to build the infrastructure needed to access more ore.

Falling reserves

Because of fewer discoveries, reduced mine life and a lower gold price, the amount of known metal that’s economically worth mining is falling. Major producers’ reserves have slipped 40 percent since 2011.

Supply crunch coming

Annual production might be near a record, but it’s not expected to last for long. Mine supply will peak in 2019 and keep falling through at least 2025, according to BMO Capital Markets. Randgold Resources Ltd. Chief Executive Officer Mark Bristow is among those expecting so-called peak gold in the next few years.

But there’s a caveat: Annual mine output totals less than 2% of all the gold that’s thought to have ever been produced and unlike commodities such as oil or copper, most of that gold is sitting in vaults or in jewelry form. That makes it easier for old metal to come back into the market if supply tightens.

The race for reserves: M&A

With their industry facing a tougher production future, gold mining CEOs have been on the hunt to buy up competitors to replace dwindling reserves. Deals for bullion producers have topped those for other commodities so far this year.

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