Cost Of Mining Per Ounce Of Gold Is USD869!

Something isn't right somewhere on current gold price listed at London or New York, current electronic trading price of an ounce of gold is around USD800 but yet the cost of mining an ounce of gold in S.Africa is a staggering USD 869/ounce! Read below :-

" The margins between costs and the Gold Price are shrinking," noted Nick Goodwin, an analyst at T-Sec in Johannesburg, to Reuters today, "as the companies try to dig out a wasting asset."This is not an easy business."South Africa's Gold Fields Ltd. – the world's fourth-largest gold miner – paid a total of $869 per ounce of production in the April-June period. The CEO, Nick Holland, says he wants to cut this "all-in cost" to $725 by March '09.After forecasting a Gold Price of $1,500 earlier this month, Holland told Creamer's Mining Weekly on Monday that "there’s not enough money today to replace the infrastructure that exists today at Gold Fields."If you tried to build these mines today, you would need a $2,000 price and higher to justify the investment."Replacement costs of all of the operations [mean] you could not recoup your investment today at these prices.

You could not build these facilities today anywhere."Mining-stock analyst Ian Henderson, manager of the $5-billion Natural Resources Fund at J.P.Morgan, told Reuters yesterday that Gold "should have a sustained price level of over $1,200 an ounce before we see any significant new mine build."Gold mining is a very complicated and expensive business and you really need to see the Gold Price a lot higher before you see any increase in gold production."

London Gold Market Report.
Adrian Ash.

Guys out there please don't trust the paper gold dealers, with the helps of few international bankers they had short sell or naked sell gold recently which in turns drive the gold price way too down for their own benefits. What there are selling/doing are merely shuffling of gold paper and not buying or selling physical gold bullion itself! With short term one month gold lease rate close to zero recently, gold dealers are turning the entire future gold markets into a scam . Manipulation of gold market price it's happening around the world currently beware holding on to your gold bullion it's the safest way to overcome the current crisis don't let them fool you!

In facts, India and other parts of the world like North America are facing gold shortage cause by rising demand and limiting supplies of physical gold coins and the like. Physical gold are in great demand yet the pricing of gold quoted in New York show price is going downward for past two weeks or so. Basic economics will tell you when demand go up price will follow upward also but then for gold it's reacted opposite direction. Take my advice start buying some for yourself now when the price it's at the downside before price go upward again.

If current situation persist long enough we will have to face with a rather daunting or worst kind of scenario that is gold mining firms shutting down their mines one after another in the long run because cost of running it far outstrip the current electronic paper gold price, which if happens will definitely drive up gold price even much further upwards!

Buy Gold.

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