Barrick Gold says gold production is in terminal decline | stockbee

11/12/2009

Barrick Gold says gold production is in terminal decline

According to this article Barrick Gold says world is running out of new gold. I am sure the gold bugs would be all over this. But it looks like a blatant case of trying to pump the prices after getting rid of its hedges. If they believed this was the case why were they hedging so heavily. Oh the PR games companies play.

Aaron Regent, president of the Canadian gold giant, said that global output has been falling by roughly 1m ounces a year since the start of the decade. Total mine supply has dropped by 10pc as ore quality erodes, implying that the roaring bull market of the last eight years may have further to run.

"There is a strong case to be made that we are already at 'peak gold'," he told The Daily Telegraph at the RBC's annual gold conference in London.

"Production peaked around 2000 and it has been in decline ever since, and we forecast that decline to continue. It is increasingly difficult to find ore," he said.

Ore grades have fallen from around 12 grams per tonne in 1950 to nearer 3 grams in the US, Canada, and Australia. South Africa's output has halved since peaking in 1970.


ABX has been anyway a laggard in that sector. The top 3 gold stocks by relative strength are KGN, THM IAG





KGN: Keegan Resources Inc

4 comments:

Renu said...

Hi,
can please tell me the scan which find outs whether fall in stock price is just a pull back or reversal.
Thanks
Renu

Pradeep Bonde said...

A ATR channel scan find that out. Or even a Guppy MMA scan can do that. A pullback or reversal depends on your time frame and definition used to measure trend. So if your definition of trend is price above 200 ma= bullish and price below 200 ma= bearish. Then any pullback above 200 ma is just a pullback and not a reversal.
Similarly if you define trend as a function of atr channel, then any move which does not break atr channel is a pullback.

Renu said...

hi,
Thanks for the reply ,could u please tell me what is atr channel and how it is used.

Thanks
Renu

Pradeep Bonde said...

ATR: Average true Range.ATR measures volatility. There are many ways to use ATR channels depending on your basic trading philosophy. Trend traders buy breakouts above atr channel. Mean reversion traders buy stocks touching lower atr channel.