World output marginally up

The production from global gold mines recorded modest growth at a little more than one per cent to 2,444 tonnes in 2007, according to GFMS. China left leader South Africa behind to take the number one slot, report said.

"Mining companies have been facing with an increasingly difficult operating environment where competition for consumables, labour and key plant items have hampered projects and operations worldwide," the London-based consultancy said in a report.

Country-wise, output from Peru and South Africa was worst hit where the former fell by a approximately 17 to its lowest level in five years. The United States and Canada also suffered declines.

However, in addition to China, higher mine output was seen in Indonesia, Brazil and Ghana, while Australia's output was relatively stable.

Consumer demand for the yellow metal, however, is expected to resume after prices stabilise. China and Turkey saw strong growth in consumer demand, while consumption in the US fell heavily, the report added.

Despite a good rally throughout last year, jewellery fabrication demand in 2007 grew by 5 per cent excluding scrap. In India, however, the demand picked in the second half of the year. Bar hoarding rose a modest 3 per cent last year, while official coin fabrication fell by 3 per cent.

World Investment, the sum of bar hoarding and coin demand, totalled 465 tonnes last year, which represented a drop of just over 40 per cent.