The novel coronavirus outbreak affects many different industries around the world. For gold-producing countries, it appears that restrictions have been put in place to lower the output of certain mines.
Most people know how the novel coronavirus crisis affects the value of different markets and assets. No market is safe from dealing with ample bearish pressure in recent weeks. Even the gold price has come under pressure, albeit it shows ample resilience to keep traders on their toes.
Novel Coronavirus Affects Gold Mining
For gold-producing countries, the novel coronavirus is not a welcome situation either. In fact, various regions are imposing gold production capacity limits on domestic mining operations. A lower production of gold can have some interesting consequences for the price, albeit it is not a guarantee for success.
In Peru, the Yanacocha mine is now forced to slowly ramp down its production of precious metal accordingly. This needs to be done in a safe manner, all the while continuing the production from leach pads. Striking a balance between production and safety will pose its own set of challenges.
Currently, the Yanacocha mine in Peru represents 3% of Newmont Corporation’s attributable gold production outlook for 2020. How these restrictions will affect the outlook for the remainder of this year, has yet to be determined. It seems likely to assume there will be some impact, despite the novel coronavirus situation being rather dynamic.
Newmont CEO and President Tom Palmer explains:
“The health and safety of our workforce and host communities takes precedence above all else.While we have no confirmed COVID-19 cases among Newmont’s workforce or any major disruptions to production at our other sites at this time, we are proactively taking steps to protect our people and the continuity of our business during this global pandemic.”
It is likely to assume that similar measures will come into effect in other countries. The production of gold is important for some regions, but it never trumps the safety of workers. Depending on how long the novel coronavirus situation lasts, there may be some major repercussions further down the line.