South Africa's gold producers stay in the shallows as prices surge
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South Africa’s gold industry is trying to respond to record prices by focusing on recovery methods that avoid the costly deep-level mining that once made the country the world’s biggest gold producer. But executives said the sector is unlikely to lift output meaningfully soon because new mine development remains limited.
Gold exploration spending has collapsed over the past two decades, falling to $43 million in 2025 from $900 million in 2006, according to Statistics South Africa. The country’s annual gold production has also dropped to 90 metric tons from a 1970 peak of 1,000 tons, reflecting dwindling viable reserves, labour unrest and the extreme geology of the deepest mines.
Gold prices rose about 60% in 2025 to repeated record highs, driven by trade tensions, central bank buying and expectations of U.S. rate cuts. Even so, the price surge has not yet translated into major investment in new South African production.
Instead, miners are favouring shallower or surface-based projects. Sibanye Stillwater is prioritising low-cost, high-margin developments such as Burnstone and is also pursuing gold recovery through its 50%-owned DRDGold, which extracts metal from waste dumps. Harmony Gold is also turning to waste retreatment, with plans to recover 5.7 million ounces, while saying underground expansion remains unlikely.
Harmony’s finance director said new underground mining is slow to develop and could take two to three years before production even begins, making future gold-price assumptions too uncertain for immediate expansion decisions. The article shows how the price rally is helping sentiment, but not yet reversing South Africa’s long decline in gold output.
