South Africa Mining Report Q4 2009

Despite the recent uptick in many metals prices, the South African mining sector continues to face a challenging operating environment. The global downturn has prompted many mining companies to scale back operations, cut proposed exploration and development projects, and lay off workers. Some firms are weathering the slowdown better than others, with iron ore producers in particular benefiting from a strong market, driven by China's high demand. In May 2009, figures released by Statistics South Africa showed that the country entered recession during the first quarter of the year, for the first time since 1992. Mining and quarrying output fell by 1.7%.

Accounting for a third of South Africa's total exports, mining remains a vital industry for the country's economy. South Africa hosts the world's largest deposits of gold and about 80% of global platinum reserves. It is also a significant producer of diamonds. The country's mining industry has matured and the pace of mineral exploration has fallen over the years ??