MINING production returned to positive growth year on year in February — ending three consecutive months of contraction, Statistics SA data showed on Thursday.
Mining production increased sharply by 7.5% in February this year compared with a year ago from a 2.3% contraction in January.
The better than expected mining production figures needed to be seen in context of a weak production base created by a platinum mining strike last year, BNP Paribas Cadiz economist Jeff Schultz said.
The sector remained under “a great deal of pressure” and looked unlikely to have contributed meaningfully to economic growth in the first quarter of this year, he said.
Growth in mining production should continue to improve in the coming months as the effects of last year’s five-month platinum strike wear off, Nedbank economists said in a research note.
However, poor global economic growth, lower commodity prices and electricity shortages would keep output “relatively weak,” they said.
The main contributors to the 7.5% increase were iron ore, which contributed 4.2 percentage points, platinum group metals, which contributed 2.8 percentage points, and manganese ore, which contributed 1.1 percentage points.
Gold was a significant negative contributor, Stats SA said.
Seasonally adjusted mining production increased by 3.8% in February after contracting by 3.5% in January and increasing 0.7% in December last year.
Seasonally adjusted mining production decreased by 1.3% in the three months ended February this year compared with the previous three months.
Mineral sales were down by 14.5% in January this year compared with a year ago mainly due to declining sales of platinum group metals, iron ore and gold.
BDlive
