Gold output in Australia, the world’s second-biggest producer, expanded for a second quarter in the period ended September because of higher ore grades, according to mining consultant Surbiton Associates Pty.
Production was 69.5 metric tons compared with 67 tons in the previous three months, Melbourne-based Surbiton said in a statement. Output was 62 tons in the same period a year earlier, it said.
Gold climbed 7.6 percent in the third quarter, the first such gain in a year, after a slump into a bear market in April spurred sales of coins, jewelry and bars. Bullion tumbled 26 percent this year amid speculation that the U.S. Federal Reserve will scale back monthly bond buying that helped prices cap a 12-year bull run in 2012.
“The higher production was due to the treatment of higher ore grades and this, in turn, reduced cash costs,” said Sandra Close, a director at Surbiton. “This is precisely what we expected, given the decline in gold prices in April and the lack of a significant recovery since then.”
Gold for immediate delivery dropped to $1,225.55 an ounce on Nov. 25, the lowest since July 8. The metal traded at $1,242.05 at 4:51 p.m. in Sydney on Nov. 29, heading for a third straight monthly loss.
Fed minutes signaled Nov. 20 that policy makers expected an improving U.S. economy to warrant trimming asset purchases in the coming months. Gold rose 70 percent from December 2008 to June 2011 as the bank bought debt to bolster the recovery.
China was the biggest producer in 2012 followed by Australia, according to the U.S. Geological Survey. Production in China rose 6.8 percent to 307.8 tons in the first nine months of this year, with output in the September quarter of 115 tons, according to data from the China Gold Association.
To contact the reporter on this story: Phoebe Sedgman in Melbourne at firstname.lastname@example.org
To contact the editor responsible for this story: James Poole at email@example.com