South Africa’s mining production deceased in September, falling for an eighth consecutive month. Data from Stats SA shows that mining fell by 4.5% year-on-year after a drop of 6.4% the previous month. Economist says the sector is being negatively impacted by falling commodity prices, energy constrains and strike action by Transnet.
The largest negative contributors to the mining production data were from iron ore and gold.
Seasonally-adjusted mining production increased by 0.1% in September 2022 compared with August 2022.
Inkunzi Wealth Economist, Owen Nkomo says the sector is likely to remain depressed for the reminder of the year.
“We have got the gold production numbers falling by 12.4 % against the forecast drop of 15% and we have the mining production numbers coming down at 4.5% which is 0.1% below (what the) market was looking for and month-on-month basis a small improvement there, 0.1% versus 0.6% decline in the previous month.”
Meanwhile, manufacturing production increased by almost 3% in September, surprising market expectations, compared with September 2021.
Data showed motor vehicle parts and accessories were the largest contributors to the September numbers contributing 3.7% points to manufacturing.
Food and beverages increased by 8.1% contributing 1.9% points to the manufacturing numbers.
“Manufacturing, we have 2.9% increase against an expected decline of 2.35%. On a month-on-month, basis we have a very big jump of 4.9% against a forecast of 0.3% increase. So, these numbers are generally mixed, but for manufacturing, the numbers are trending higher and are reflecting an improvement. All these numbers need to be trend up for us to be better excited about the economy and GDP going forward.”
South Africa’s economy is expected to enter a recession in Quarter 3 with real GDP expected contract by 0.2% quarter-on-quarter due to power outages and a protracted strike action.
Stats SA data shows mining production decreased by 5,9% year-on-year in August:
Source: SABC News (sabcnews.com)