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The Pallinghurst Group now has within its fold all the key elements needed for lithium-ion batteries, fuel-cells and the green hydrogen economy.

Pallinghurst’s latest transaction with Talon Metals brings in nickel, copper and cobalt, which augment the already-in-the-bag graphite, battery-grade lithium hydroxide and platinum group metals (PGMs). (Also watch attached Creamer Media video.)

All this is taking place as the twenty-sixth United Nations Climate Change Conference – COP26 – calls for urgent action to reduce carbon emissions and to build resilience to the accelerating impacts of climate change.

“What our latest acquisition means is that we now have all the key elements that you need for the lithium-ion battery – and we have the key elements in platinum group metals that you need for fuel cells and the green hydrogen economy. We had the benefit of being ahead of the curve and we’ve got what we were looking for,” Pallinghurst Co-CEO Arne Frandsen said during a Zoom interview with Mining Weekly. Frandsen chairs the New York-listed Nouveau Monde Graphite of Canada, partners the Government of Quebec with Nemaska Lithium, and chairs Sedibelo Platinum Mines in South Africa, a prime example of how progressive thinking can lead to a very sustainable source of PGMs which are poised to play a climate-bettering role in the green hydrogen economy.

TSX-listed Talon Metals, headed by South African-moulded CEO Henri van Rooyen, has been developing assets which Frandsen describes as North America’s most exciting nickel prospects. Also in the mix are cobalt and copper.

Nickel sulphate, needed to give range to battery electric vehicles, will be produced and true to the consistently green template which has become synonymous with Pallinghurst, the operation will have a zero-carbon footprint – along with the ability to deliver the three critical cathode materials to the battery makers of North America and beyond.

For the anode side of the battery, the Pallinghurst-linked Nouveau Monde is rolling out the Phase 1 graphite beneficiation plant on schedule and on budget to produce battery-grade graphite early next year in the most environment-friendly way. The high temperature, electricity-intensive purification process has the benefit of carbon-free hydropower and its commercial line shapes and purifies coated graphite to install in the anode of batteries. Key is that the graphite particles are correctly shaped, free from impurities and coated for correct stacking.

The New York-listed Nouveau Monde is also on its way to becoming the country’s first all-electric opencast mine at the Saint-Michel-des-Saints operation, with mine hauling also hydropowered. Moreover, deforestation is being addressed by tree planting to ensure that the mine site benefits from maximum forest cover.

Nemaska Lithium and the battery-grade lithium hydroxide it offers forms an important part of the business against the backdrop of lithium being supply-constrained and Nemaska’s hard rock spodumene project being one of the largest of its kind in North America.

A significant amount of money has been invested and preparation has commenced for the building of the hydroxide chemical factory. The spodumene concentrate produced at the mine will be processed.

“It’s really going full speed ahead,” said Frandsen, who described the Government of Quebec as being a great partner.

PLATINUM GROUP METALS

Sedibelo’s Pilanesberg platinum mines are situated in the Bushveld Complex, 207 km west of Johannesburg. In December last year, Sedibelo announced the expansion of operations at Pilanesberg into contiguous deposits of Sedibelo Central, Magazynskraal and Kruidfontein – known as the Triple Crown properties, with an estimated resource base in excess of 60-million four element PGM ounces. The expansion includes the construction now on schedule to deliver a 110 000 t beneficiation plant, employing the remarkable cost- and energy-efficient Kell technology, which slashes 82% off electricity use...

Global diamond manufacturer and trader Pluczenik Diamond Company has made a re-entry into the South African market by partnering with a local entrepreneur to open a diamond cutting and polishing facility in Bedfordview.

Pluczenik was initially established in South Africa in 1948, before migrating its headquarters to Belgium a few decades later. It also has diamond manufacturing facilities in Namibia, Botswana and Lesotho.

The new partnership between Nungu Diamonds founder Kealeboga Pule and Pluczenik resulted from an enterprise development programme of diamond miner De Beers. Pule will serve as Pluczenik South Africa MD.

Pluczenik is one of the largest buyers of rough diamonds globally and has been a De Beers sightholder for more than 60 years. Pluczenik cuts some of the rarest and most exceptional diamonds in the world, which puts any affiliate with the company in good stead of gaining valuable skills.

De Beers had five South African diamond cutting and polishing companies graduate from the first phase of its Enterprise Development Project in 2019, after launching in 2016, with the aim of transforming the cutting and polishing industry in South Africa.

Pule comments that a partnership such as that between himself, as a small business owner, and a corporate group is not just good for the diamond industry, but for the whole of South Africa, in that it encompasses a positive story where previously disadvantaged individuals are not just bystanders but active participants in the trade from mine to market.

He believes that diamonds ought to be improving the lives of South Africans, through the right partnerships and dedication.

Pule explains that the Bedfordview facility has created 30 new jobs, with South Africans having been skilled in the cutting and polishing of diamonds, while Pluczenik CEO Chaim Pluczenik foresees the facility growing to employ 200 people in due course, similar to the group’s diamond factory in Botswana.

Pluczenik believes the facility helps South Africa meet its beneficiation objectives and supports communities, particularly as diamonds have had a long history and heritage in the country.

Belgium Ambassador to South Africa Didier Vanderhasselt has also expressed his support for the partnership, saying diamond trade and traceability of the value chain is immensely important for Belgium. About 49% of South Africa’s exports to Belgium comprise precious gemstones.

South African Diamonds and Precious Metals Regulator CEO Cecil Khosa says localisation is key to reigniting the South Africa economy, and hopes to see this initiative serving as an example for how small businesses or entrepreneurs can partner with large players in the mining industry.

He says the partnership is testament to large corporates’ successful enterprise development and job creation programmes, adding that the factory helps bridge the local diamond manufacturing shortfall, as well as enables access to markets and sharing of technical skills.

De Beers global sightholder sales executive VP Paul Rowley says De Beers has been on a beneficiation promotion journey for many years, not just to get diamonds polished, but to make the industry more sustainable.

De Beers will be supplying rough diamonds for cutting and polishing to Pluczenik South Africa.

Diversified mining company Anglo American is planning to use water in its underground mines to generate electricity.

The water will be pumped up when operations have excess renewable power and allowed to run back down when electricity is needed.

From the work Anglo’s teams have done under technical director Tony O’Neill, the system will reduce storage capacity by around 50% when compared with lithium batteries or even hydrogen storage.

“It’s a really smart solution based on the physical assets that we’ve got in the country that are under-utilised. It provides as with a really cost-effective solution for the whole South African package,” Anglo CE Mark Cutifani said during the company’s second 2021 sustainability update, in which Anglo FD Stephen Pearce, Anglo tax head Zahira Quattrocchi and Anglo responsible business partnerships head Jon Samuel also featured prominently. (Also see attached image.)

Envisaged is that the pumped hydro storage system will dovetail with wheeled Southern African wind and solar power to provide Anglo with energy – at all its sites.

A slide displayed during the sustainability update showed the planned renewable infrastructure supporting the emissions reduction and involving from 2.7 GW to 4.4 GW of increased grid capacity for round-the-clock clean power provided by off-site wind power, solar power and regional energy storage as well as on-site input for green hydrogen generation.

Investment will be led by third party infrastructure funds with a 2030 completion date on the displayed slide, which listed Anglo operations including the Mogalakwena platinum group metals (PGMs) mine, the Venetia diamond mine, Polokwane, Mortimer and Rustenburg processing plants, the underground Amandelbult and Mototolo PGM mines, and the Sishen and Kolomela iron-ore operations located in South Africa's very hot Northern Cape.

Renewable energy generation taking place inside the fence of Anglo's operations would, the company said, be dedicated to production and hydrogen generation, which is already taking shape at Mogalakwena where the world's biggest hydrogen haul truck will be launched early next year.

“In terms of renewable electricity, I’d like to make the point that we’re not just talking about change, we’re doing it,” Cutifani enthused.

The London- and Johannesburg-listed company’s Scope 2 emission reduction is about switching to renewables. Scope 2 emissions are indirect emissions from the generation of purchased energy, from a utility provider.

ANGLO ALREADY 100% RENEWABLE IN SOUTH AMERICA

Anglo has already signed contracts for all of its South American operations and by the end of next year, it will have a 100% renewable supply in South America.

That will take Anglo’s renewable electricity from about 36% of total electricity input across the group to about 56% from 2023.

Featuring overwhelmingly in the remaining 44% is South Africa, which will require a different approach.

“The last 44% requires us to think differently and it does require some investment, either from us or third parties. But the interest we’ve had from third parties and other producers of electricity in those areas certainly gives us confidence that we can get a return on our investments and the outgoing capital will be relatively easy to manage, depending on the absolute cost we’re chasing and the returns.

“It’s a work in progress but certainly the pathway looks pretty good and certainly we believe we’re going to be able to wash face in term of capital inputs – and that, from our point of view, is part of that competitive positioning that we see, which we think is quite different to our competitors,” said Cutifani.

During question time, Cutifani described the South African government as being “very supportive” of Anglo’s Southern African renewables and pumped hydro power proposals.

He also noted power utility Eskom’s recent reference to $30-billion of investment in creating a new energy strategy for South Africa and said a number of pension funds...

Diversified mining company Anglo American, which is piloting the world’s biggest green hydrogen-powered haulage vehicle, is planning to replace its global truck fleet of 400 diesel trucks with hydrogen trucks over a ten-year period from about 2024.

Introducing hydrogen mobility on its mines will be material to its ambition of achieving carbon neutrality by 2040 as diesel represents 17% to 18% of the London- and Johannesburg-listed company’s carbon emissions. This change is expected to reduce group carbon emissions by 15%.

Anglo expects to start transitioning its truck fleet from around 2024 and complete the task over the ten years that follow, Anglo CE Mark Cutifani said during the company’s second 2021 sustainability update covered by Mining Weekly.

Cutifani had just returned from Anglo American Platinum’s Mogalakwena platinum mine in South Africa’s Limpopo province, where he took a look at the chassis and moving parts of the huge 290 t capacity hydrogen haul truck that is taking the world by storm. The truck is expected to be functioning early next year. (Also see attached image.)

“The pilot project’s progressing well,” Cutifani reported, while emphasising that the 2 MW hybrid fuel cell and battery powered unit is heading for full in-mine functionality – it will load, haul and then dump material at the crusher.

“It’s the real deal," said Cutifani, who enthused about it being at least two years ahead of competitors.

Based on what has been learnt in building this first unit, a second hydrogen haul truck pilot is already being looked at.

“We’ll finish the trials. We’ll then go on to the second phase and after that, we’d expect to start changing the truck fleets from around 2024. We’ll then look to replace our global fleet as trucks come up for lifecycle change,” said Cutifani.

That would, he said, be done at a pace of ten trucks per time, each batch including a hydrogen electrolyser to generate hydrogen to move those trucks in zero-carbon fashion, with the change being implemented progressively. Moreover, Cutifani foresees technologies and efficiencies also improving over time to create even more benefit.

“Longer term, we believe this configuration is right up there with any other configuration in terms of efficiency, unit operating costs and playing a big part in the future.

“It’s also a unit that is quite flexible," he said, referring to the hybrid hydrogen battery unit which enables stripping, the biggest part of mining cost across the operation, to be done more effectively. "That’s where we want that flexibility and for us, this change represents reduction of 15% in our carbon emissions,” Cutifani calculated.

Anglo has laudably taken a hugely promising global lead by cleverly researching and developing the hydrogen haul truck, against the background of original equipment manufacturers not being in a position to advance the absolutely necessary initiative to mitigate climate change.

“We’ve driven it and now they’re following us. That’s good news,” said Cutifani.

However, long-term, Anglo has no ambition to be a truck manufacturer; "but we needed to set the pace of change and that’s what’s happening and that’s good news for the industry", said Cutfani

Anglo’s FutureSmart Mining technologies, which have been advanced so brilliantly by technical director Tony O'Neill and his team, are key to introducing energy use in an absolute sense, thereby increasing efficiency and reducing costs, "which also provides us with the ability to develop cleaner technologies such as hydrogen haulage – and which, in turn, is all about replacing diesel used in the operations", an upbeat Cutifani explained.

Industry organisation the Minerals Council South Africa urges the Department of Mineral Resources and Energy (DMRE), organised labour, mine professional associations and mining suppliers to hold the MineSafe summit in November, as soon as possible after the elections, to address the regression in mine safety.

The council, along with the DMRE, organised labour, mine professional associations and mining suppliers supports the expedition of the MineSafe summit to urgently address the regression in safety, the council said on October 29

As of October 28, the number of fatalities at the country’s mines stood at 55, compared with 43 at the same time in 2020.

The industry experienced one of its worst weeks with two multiple fatality incidents. This is the second year of regression in safety performance since the 2019 record-low of 51 fatalities.

The council has also emphasised the role of technology in improving mine safety.

“We see technology as the way to significantly reduce our risks and improve safety. As human beings, we all make mistakes and, by using technology, we can start eliminating the fatal risks from unintentional mistakes,” said iron-ore miner Kumba Iron Ore CEO and CEO Zero Harm Leadership Forum chairperson Themba Mkhwanazi.

“With the regression we are experiencing, we need to put a lot more focus on technology and modernisation to improve skills and mining methods to keep employees safe,” he said.

At the CEO Zero Harm Forum on October 29, CEOs and mine leadership recommitted themselves to achieving fatality-free operations, to re-evaluate and re-energise their safety programmes, and learn from each other to minimise repeated incidents.

“The last quarter of the year is normally a time when higher vigilance is needed, so the urgency of holding the summit and addressing the regression in safety, and agreeing solutions, cannot be understated,” Mkhwanazi said.

The industry is tackling the three leading causes of fatalities in mining through the CEO-led Khumbul’ekhaya strategy, with a focus on a holistic approach to eliminating fatalities as a result of safety and health incidents, including Covid-19, the Minerals Council said in a statement.

The leading cause of fatalities remains falls of ground (FoGs), which is a focus area for the Minerals Council in partnership with the Mandela Mining Precinct and the Department of Science and Innovation. There were 60 fatalities in the full year of 2020, over 20 of which were caused by FoGs.

General types of accidents were the second-largest cause of fatalities, with transport-related incidents third. In terms of transport-related incidents, the Minerals Council has a three-year, R20-million project to support members on the adoption of collision management systems.

The Minerals Council is working with various stakeholders including the DMRE, trade unions, research institutions, academia, original-equipment manufacturers and suppliers on the development of a holistic risk phased approach to the development and implementation of collision avoidance systems technologies.

The Minerals Council is implementing the R46-million, five-year Elimination of FoG Fatalities Action Plan approved by the CEO Zero Harm Forum and the Minerals Council board.

The Action Plan was launched during the National Day of Health and Safety in Mining held on July 8. The Action Plan will complement other industry health and safety initiatives at the Mine Health and Safety Council aimed at achieving a desired step change in the elimination of FoG fatalities.

Diversified mining and marketing company Glencore expects its full-year 2021 adjusted earnings before interest and taxes to exceed the top end of its forecast $2.2-billion- to $3.2-billion-a-year long-term guidance range.

A production highlight included 65%-higher attributable ferrochrome production of 1 071 000 t – 420 000 t more than the comparable 2020 period, when operations were suspended for much of South Africa’s second-quarter Covid lockdown.

In presenting the third-quarter production report for the three months to September 30, Glencore CEO Gary Nagle said the asset base of the London- and Johannesburg-listed company had largely performed in line with expectations.

“Our full year production guidance remains unchanged,” Nagle stated in a release to Mining Weekly.

The company’s recovery from the market-driven production cuts initiated within its Australian coal portfolio in the second half of 2020 was highlighted, with marketing’s continued strong performance helping towards the likely exceeding of the top end of the long-term guidance range forecast.

Coal production was a 9%-lower 76.3-million tonnes, with the 7.2-million tonnes reduction reflecting a full period of Prodeco care and maintenance, 2020’s second-half recovery from the market-related reductions across the Australian portfolio and lower domestic production and demand in South Africa.

Glencore’s own-sourced copper production of 895 500 t was 4% below the comparable 2020 period, on lower mined grades at various operations.

The company’s own-sourced zinc production of 855 800 t was in line with the comparable 2020 period and own-sourced nickel production of 71 100 t was 13% lower than the comparable 2020 period owing to planned maintenance at Murrin Murrin, in Australia, and various operating issues at Koniambo, in New Caledonia.

Entitlement interest oil production of 4.1-million barrels of oil equivalent was 23% higher than the comparable 2020 period, mainly reflecting the gas phase of a project in Equatorial Guinea from February 2021, and a full period contribution from the new well in Cameroon. The Chad fields remained on care and maintenance throughout 2021.

Glencore reached an agreement this month to sell for $242-million 100% of the interests in its wholly owned subsidiary Chemoil Terminals, which owns the Long Beach and Carson oil products storage terminals in California.

Glencore has also reached agreement to dispose of its Bolivian zinc assets, Sinchi Wayra and Illapa, to Santacruz Silver Mining for about $110-million.

Moreover, the Colombian National Mining Agency has accepted the relinquishment of Prodeco’s key mining contracts back to the Republic of Colombia, with the mines remaining on care and maintenance until the formal process of relinquishing the contracts is complete.

Diversified mining company Anglo American on Friday published its Climate Change Report 2021, ahead of its six-monthly sustainability performance update.

The update includes Anglo’s progress towards its target of carbon neutral operations (Scopes 1 and 2) by 2040 and its ambition to reduce its Scope 3 emissions by the same year, 2040.

Anglo CE Mark Cutifani highlighted the long understanding of the London- and Johannesburg-listed company’s realisation that its sustainability and financial performances, together with its ability to deliver attractive returns over the long term, are inextricably linked.

“Our strategic choices position us increasingly to supply many of the metals and minerals that are critical to enabling the technologies society needs to decarbonise energy and transport, but also to cater for the needs of an ever-growing global consumer population,” said Cutifani in a release to Mining Weekly.

With that responsibility, recognition of the mining industry’s imperative to continue to evolve was recognised. Through innovative technologies and practices, the industry could be more targeted in accessing those metals and minerals, using less water and energy and, crucially, generating fewer greenhouse gas (GHG) emissions.

Anglo’s FutureSmart Mining™ programme, using technology to transform its safety and sustainability performance, had helped the company make significant progress in recent years and efforts were being accelerated.

"Building upon our commitment to carbon neutrality across our operations by 2040, we have today set our ambition to reduce our Scope 3 emissions by 50%, also by 2040,” Cutifani stated.

SCOPES 1 AND 2: CARBON NEUTRAL BY 2040

Anglo’s most recent Climate Change Report sets out the progress being made towards the year-old commitment to deliver carbon neutral operations by 2040, having met its 2020 GHG reduction target a year ahead of time.

“Our integrated FutureSmart Mining™ approach to driving sustainability outcomes through technology and digitalisation is central to our plan and our progress, as are the partnerships we are exploring to help catalyse the delivery of renewables infrastructure, for example, in South Africa,” Cutifani said.

Last year, a little more than one-third of the electricity Anglo used globally was drawn from renewable sources.

Having now secured 100% renewable electricity supply across its operations in Brazil, Chile and Peru, by 2023 drawing 56% of grid supply from renewables was expected.

Another major step, he said, was to displace diesel usage in its mine truck fleet – accounting for 10% to 15% of Anglo American’s Scope 1 emissions.

The company’s 2 MW hydrogen fuel cell and battery hybrid pilot truck being assembled in South Africa – a zero emission truck capable of carrying a 290 t payload – would generate more power than its diesel predecessor, a world first.

“Once fully tested, we intend to begin rolling out this technology across our global truck fleet starting in 2024 and this will follow our typical truck refurbishment and replacement cycles. Our haul trucks contribute up to 80% of the diesel emissions at our sites and we therefore expect to be taking the equivalent of more than half a million internal combustion cars off the road by switching our trucks to hydrogen,” he said.

SCOPE 3: 50% REDUCTION BY 2040

Anglo, which has continued to accelerate its decarbonisation initiatives, has now added an ambition to reduce its Scope 3 emissions by 50%, also by 2040.

“Whilst we know that this ambition is challenging, the work we have done in the past two years has helped us to understand more fully our own Scope 3 inventory and the levers that we can pull to influence the reduction of those emissions. This work will inform our development and ongoing refinement of our Scope 3 reduction pathway, while recognising that our ability to significantly reduce our Scope 3 emissions is dependent both on the steel sector decarbonising and a supportive global policy environment.

...

Mining Weekly Editor Martin Creamer discusses the recent Impala Platinum proposal that seeks to acquire Royal Bafokeng Platinum, as well as African Rainbow Minerals being in talks to acquire the Bokoni Platinum Mine. Further, he notes that while miners are urged to take hydrogen seriously in its decarbonisation strategies, Canada’s First Nations are seeing it as a reconciliation opportunity. Lastly, as mining looks towards sustainability in the face of climate change, Sibanye-Stillwater says it is well-positioned as a climate resilient business.

Hydrogen has an essential role to play to meet the climate change imperative of carbon neutrality, a World Hydrogen Leaders panel highlighted week.

French, British, Norwegian and Swiss energy representatives taking part in the World Hydrogen Leaders discussion on the regulatory landscape of hydrogen in the gas grids emphasised the need for speed and flexibility. (Also watch attached Creamer Media video.)

What also emerged was that many of the regulatory components required are already in place – but with dots needing to be joined.

Germany’s Ontras Gastransport, which is already heavily engaged in various hydrogen projects, cited as one of its main objectives the task of connecting Eastern Germany “as quickly as possible” to the pan-European hydrogen backbone that is evolving.

“It’s clear that hydrogen has a crucial role in the transformation of the European energy system in turning Europe into a climate-neutral economy,” Ontras Gastransport regulatory affairs and energy policy head Dirk Manske told the virtual event in which Mining Weekly participated.

For that to happen, a cost-effective, reliable, sustainable and fast development of the European hydrogen network is needed.

“There’s already a lot in place of what we need,” said Manske, who took part in a panel discussion with UK Energy Digitalisation Taskforce chairperson Laura Sandys, who is also nonexecutive director of gas network company SGN, France’s GRTgaz strategy deputy director Nicholas Peugniez, Norway’s University of Oslo energy law associate professor Catherine Banet, UK’s Ofgem deputy director Michael Wagner and Switzerland’s Smartenergy H2 Projects MD Christian Pho Duc.

Banet spoke of the abundance of hydrogen opportunities but also of their different scales. “We have the big industrial projects with companies at the front line and there have been wonderful projects. But we also have the small local energy systems that deliver a lot of local benefits from hydrogen development,” she said, in drawing attention to the Orkney Islands wanting to develop their own energy security and to sell hydrogen to other countries.

Pho Duc said his company’s concentration in the development of hydrogen projects was focused on the seven countries of Europe, with several examples in Portugal. He spoke of hydrogen presenting a great opportunity that needed to be developed “very fast”.

Wagner, in the knowledge that hydrogen is going to be needed to decarbonise heavy industry, power and heavy transport, spoke of the UK the government targeting a couple of industrial clusters by mid-2020s and a further two by 2030, along with 5GW of low-carbon hydrogen production.

“Initially, the clusters may not really require much in the way of economic regulation but as they develop, we may need a regulatory structure,” said Wagner.

With hydrogen poised to become a pillar of the energy generated, Peugniez emphasised the need to scaled-up plans to ensure that short-term decisions did not inhibit the longer-term outlook.

“That’s really the issue. We need forward-looking planning, taking in what is envisaged in the future,” said Peugniez.

“We understand that hydrogen will provide some flexibility and stability to the whole energy system, including electricity, so the issue of security of supply is also something to take into account.

“With hydrogen, we don’t have to restart a 20-year learning curve. We have a process and a market that is working,” he pointed out.

He drew attention to a adding that a market survey having been done in France assess demand, as was also the case in the Netherlands and Germany. “So, we are starting to work together and to interact with market participants to build this infrastructure,” he said.

Envisaged is that existing gas networks will be repurposed without huge change.

Gold demand fell 7% year-on-year and 13% quarter-on-quarter to 831 t in the third quarter, primarily owing to outflows from gold-backed exchange-traded funds (ETFs), the World Gold Council’s (WGC’s) latest ‘Gold Demand Trends’ (GDT) report, shows.

Net gold ETF sales were relatively small at 27 t, but when compared with the pandemic-induced buying surge of a year earlier, the council says it was enough to place overall gold demand into a year-on-year decline, despite demand increasing in all other sectors.

WGC market intelligence manager Krishan Gopaul tells Mining Weekly that positive signs can, however, be found elsewhere, in spite of the overall decline.

Consumer demand in jewellery increased by 33% year-on-year to 443 t in the third quarter, demonstrating that the industry is recovering from the challenges it experienced in the last year, largely attributable to the Covid-19 pandemic and related movement restrictions.

Gold’s use in technology is also showing some greener shoots as it continues to improve from 2020’s lows as consumers continue to show an interest in obtaining new devices. Demand in this segment grew by 9% year-on-year and 4% quarter-on-quarter.

Central banks, meanwhile, added 69 t to their reserves during the quarter.

The bar and coin segment, meanwhile, also continued to see higher demand as it reported a fifth consecutive quarter of year-on-year gains, with 262 t bought in the third quarter, an increase of 18% year-on-year and 8% quarter-on-quarter.

Commenting on investor sentiments, Gopaul notes that bar and coin investment did see continued interest, in spite of price weakness during the quarter, which he says many investors used as a “gold buying opportunity”.

Overall demand declined by 7% year-on-year and 13% quarter-on-quarter to 831 t, while total supply was 3% lower year-on-year at 1 239 t, despite mine production having risen to its highest quarterly level on record.

The year-on-year drop in supply was owing to a sharp fall in recycling in response to lower gold prices.

ETFs, meanwhile, recorded a “bit of a turnaround” from last year, where it reported breaking levels of investment or inflows into gold ETFs.

“What we’ve seen this year is that has reversed into net outflows. What was key is that the level of net outflows are all relatively minor in comparison to the inflows that we saw last year,” Gopaul points out.

The level of gold holdings in global gold ETFs has remained “relatively steady” over the last six months, with no significant shifts.

In a separate release on October 28, WGC senior markets analyst Louise Street notes that the “relatively modest outflows from gold ETFs” have had a disproportionate effect on this year’s figures, outweighing positivity almost everywhere else across the board.

“The outflows themselves are part of a bigger picture. A year ago, investors were flocking to gold, seeking a hedge against the pandemic. And gold ETFs were particular beneficiaries of these flows, adding more than 1 000 t over the first three quarters of the 2020.

“So, while there has been selling by gold ETF investors this year, the outflows have been modest in comparison,” she comments, echoing sentiments shared by Gopaul.

Further, the gold price averaged $1 790/oz throughout the quarter – down from 2020’s third quarter high – but was above its three-year, five-year and ten-year averages.

Looking forward, Street says the council expects the full-year picture for gold demand to look very similar – strong consumer and central bank demand will mitigate losses from ETFs.

“Jewellery demand will continue to exceed last year’s levels, but investment demand in total will be weaker in 2021, despite healthy bar and coin demand.”

This, Gopaul says, was broadly in line with the council’s expectations of a recovery in jewellery and consumer elements.

“Where we may have been slightly surprised, is on the central banking side, where we expected central bank to remain purchasers, but it's very difficult to pred...