COVID-19 lowers gold production by 12% in 2020

Eric Asubonteng

but sector holds firm to emerge economy’s lead export earner

Gold production in 2020 fell 12.1 percent – the highest decline since 2014 – from 4.577 million ounces in 2019 to 4.023 million ounces, the Ghana Chamber of Mines said in its 2020 annual report, citing COVID-19.

Despite the decline in production, the sector’s contribution to the national fiscal purse increased marginally from GH¢4.013billion in 2019 to GH¢4.172billion in 2020. The 3.97 percent increase in fiscal revenue was driven primarily by strong appreciation in the price of gold during the period.

“The significant appreciation in the price of gold during the year under review increased mineral royalty revenue by 38.20 percent from GH¢1.007billion in 2019 to GH¢1.391billion in 2020,” said President of the Chamber, Eric Asubonteng.

The country also retained its position as the continent’s leading gold producer and the world’s sixth despite the reduction in production volumes, while other mining and quarrying sectors regained their position as the leading source of direct domestic revenue in 2020.

A breakdown of the volumes shows that while the large-scale sub-sector dropped by 4.8 percent to 2.847 million ounces in 2020, the small-scale sector fell by 26 percent from 1.588 million ounces in 2019 to 1.175 million ounces in 2020.

“A positive note, however, was the commencement of production at Obuasi Mine of AngloGold Ashanti, and growth in the output at Gold Fields’ operations as well as the Wassa Mine of Golden Star Resources,” says Mr. Asubonteng.


This, according to him, represents a marked departure from past years, as the volume of manganese produced by Ghana’s sole producer, Ghana Manganese Company, declined from 5.383 million tonnes in 2019 to 2.358 million tonnes in 2020.

The 56.2 percent drop in production was primarily due to government’s directive to stop the company’s operation in the year under review – resulting in the suspension of manganese production in the first quarter of 2020.


For diamonds, the downward trend in the purchases continued unabated due to the suspension of production by the only large-scale producer, Great Consolidated Diamond Company. In essence, diamond purchases in 2020 reduced by 25.1 percent to 25,292 carats from 33,789 carats in 2019.


Additionally, the Ghana Bauxite Company recorded a 4.1 percent improvement in its output. The expansion in shipment of bauxite from 1.116 million tonnes in 2019 to 1.162 million tonnes in 2020 was principally due to an improvement in its operational activities.

Export differentiator

Despite the challenges faced last year, the mining industry remained the main anchor of the country’s trade balance; as data from the Bank of Ghana showed that the sector was the foremost source of foreign exchange receipts, accounting for 48.4 percent of gross merchandise exports in 2020.

This compares favourably with the 42.6 percent recorded in 2019, and far outstrips the combined contribution of crude oil and cocoa in 2020 by more than 12 percentage points. “The mining industry continued to support the economy by reducing pressure on the local currency and its resultant impact on prices and other parameters. Proceeds from export of minerals increased from US$6.678billion in 2019 to US$6.998billion in 2020, representing a growth rate of 4.8 percent,” Mr. Asubonteng said.

He added that producing member-companies of the Chamber returned US$3.67billion out of the mineral revenue of US$5.14billion to the country, representing 71 percent of the revenue from producing member-companies.


In 2021, the Chamber expects an increase in production from existing mines; and the gradual easing of COVID-19 restrictions signals good prospects for the mining industry. “Similarly, the expected relatively high price of gold is likely to support growth in recycled gold and producer de-hedging. Overall, we project that global supply of gold in 2021 will exceed corresponding output in 2020.

“In 2021, the Chamber expects most of its gold-producing member-companies to recover from the drags that characterised their operations in the preceding year. Overall, the gold output of producing member-companies for 2021 is forecasted to range between 3.0 million to 3.3 million ounces. The industry also expects production of manganese by Ghana Manganese Company to increase with a sustained full year of production in 2021,” Mr. Asubonteng added.

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