BMI View: Ghana's gold output will slow as miners cut costs and restructure organisation in a comparatively subdued price environment. In addition, the country's regulatory environment and ongoing power shortages will limit the sector's growth outlook.
|e/f = BMI estimate/forecast. Source: National sources, BMI|
|Mining Industry Value, USDbn||3.77||3.85||3.83||3.83||3.84||3.93|
|Mining Industry Value, USDbn, % y-o-y||2.00||2.00||-1.00||0.00||0.00||2.00|
Latest Developments & Structural Trends
On July 13 , Gulf Shores Resources announced the signing of a Letter of Intent with Goldplat PLC for the right to earn 75% of Goldplat's interest in the Anumso gold project by expending US$3.0M on exploration over 2.5 years. On April 12, Cardinal Resources Ltd (Cardinal) added two more drill rigs at the firm's Namdini project ahead of a Q3, 2016 exploration target announcement. Currently, Cardinal has three projects in Ghana, namely the Namdini, Bolgatanga and Subranum mines.
Gold mining firm Randgold Resources has ended a contract for redeveloping AngloGold Ashanti's Obuasi gold mine in Ghana. The move follows efforts by both the companies to improve the project's returns. The companies had announced a deal in September 2015 to form a joint venture to redevelop and operate the mine. Randgold had agreed to lead and fund a development plan designed to rebuild the operation.
We remain bullish towards gold prices and have marginally bumped up our 2016 and 2017 price forecasts to USD1,300/oz (from USD1,275/oz) and USD1,400/oz (from USD1,350/oz), respectively. Economic (slowing US growth) and political (Brexit) developments in recent months have reinforced our belief that real interest rates in developed markets will remain depressed through 2016-2018 at least. While this trajectory has largely been priced into markets for 2016, we expect that real rates will surprise to the downside in 2017-2018. This will come as global inflation and economic growth surprise to the upside and downside, respectively. The below chart illustrates that we believe 2016 represents a trend change in real rates after several years of grinding higher.
We have revised up our production forecasts and expect output to grow from 3.67 million ounces (moz) in 2016 to 3.93moz by 2020, which would represent an average annual growth of 1.6% during this period.
The Ghana Mining Report has been researched at source and features BMI Research's mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Ghana Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Ghana.
- Use BMI's independent industry forecasts on Ghana to test other views - a key input for successful budgeting and planning in this mining market.
- Target business opportunities and risks in Ghana's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Ghana.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.
BMI Industry View
Summary of BMI’s key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.
Industry SWOT analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the mining sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Mining industry: Industry size (USDmn), real growth (%), % of GDP, employment (‘000), workforce as % of total workforce, average wage (USD).
- Output: Production volumes (‘000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
- Exports: Value of exports (USDmn) for all major metals, minerals, ores and gems mined in each state.
- Commodity markets: Global demand, supply, stocks and benchmark prices (USD) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.
BMI’s Mining Risk Reward Index
BMI’s Risk Reward Indices provide investors (mining companies and support service providers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
Competitive Landscape Tables & Analysis
Comparative company analyses and tables detailing USD sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.
Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Mining reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.