Cash cost drops for gold producers

The average cash cost of Western gold producers dropped to US$247 per oz. in 1992 from US$260 the previous year, Gold Fields Mineral Services reports in its Gold 1993 report.

otal average production cost last year fell to US$300 from US$312. The cash cost among Canadian gold producers last year averaged US$229, down from US$244 in 1991.

Gold Fields lists two main reasons for the drop in costs, a stronger US dollar when measured against the currencies of major Western producing nations, and measures taken by producers to reduce costs in the face of a relatively low gold price.

The average cash cost among South African producers dropped to US$286 last year from US$294 in 1991. During the first half of the 1980s, South Africa was the lowest-cost gold producer of the Western producers.

The average cash cost in 1992 among U.S. producers declined to US$218 from US$235.

In defining cash cost, Gold Fields takes in costs charged to production at the mine site, realization costs and royalties, less any byproduct credits. The total production cost takes in the cash cost, depreciation, depletion and amortization costs, head office charges and interest charges.