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Gold price seen near tipping point for mine cuts, closures

Posted by ipso facto @ 10:51 on September 26, 2014  

VANCOUVER –The price of gold, down more than a third in three years, is approaching the tipping point where the mining industry would see a spike in the number of producers reducing output or even shutting down operations.

Several mines globally have already suspended output in the past 18 months, but not as many as industry watchers expected as producers focused on slashing costs and reworking mine plans to extract more profitable, higher-grade ounces.

But with bullion’s slide this week to a nine-month low of $1 208.36 an ounce, those defenses may not be enough.

“$1 200 is a critical level. The industry has geared itself around $1 200,” said Joseph Foster, portfolio manager at institutional investor Van Eck Global. “If it falls below that level, then there are a lot of mines around the world that are really going to struggle.”

more http://www.miningweekly.com/article/gold-price-seen-near-tipping-point-for-mine-cuts-closures-2014-09-26

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Post by the Golden Rule. Oasis not responsible for content/accuracy of posts. DYODD.