Australian Gold Production Declined in First Quarter on Weather

Gold output in Australia, the world’s second-biggest producer, fell in the first quarter as wet weather disrupted some operations, mining consultant Surbiton Associates Pty said.

Production was 63.5 metric tons in the three months through March, about 5 percent less than the fourth quarter of 2012, Melbourne-based Surbiton said in a statement. Output was about 1 percent higher than the same period a year earlier, it said.

“It’s the shortest quarter of the year,” Sandra Close, a director at Surbiton, said in the statement. “In addition, there was the usual dislocation due to wet weather from the summer cyclones.”

Bullion dropped 4.6 percent in the first three months of the year for the first back-to-back quarterly declines since 2001. Prices are down 17 percent this year and tumbled into a bear market in April as some investors lost faith in the precious metal as a store of value and an improving U.S. economy increased concern the Federal Reserve may scale back debt purchases that helped bullion cap a 12-year bull run in 2012.

In Australian dollar terms, the decline in prices since April has been less dramatic as the local currency eased, Close said. The Australian dollar tumbled 7.7 percent last month.

Newcrest Mining Ltd. (NCM), Australia’s largest gold producer, said June 7 that it will write down the value of its assets by as much as A$6 billion ($5.8 billion) after the slump in prices.

China was the world’s biggest gold producer in 2012 followed by Australia, according to the U.S. Geological Survey.

To contact the reporter on this story: Phoebe Sedgman in Melbourne at psedgman2@bloomberg.net

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

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