South Africa's mining production sees slight increase despite US tariffs on other goods
Image: Pixabay
South Africa's mining production increased by a mere 0.2% in May year-on-year, according to Statistics South Africa's mining production and Sales report.
Manganese ore recorded the largest negative contribution to the overall performance, followed by coal. Copper also declined over the period and platinum group metals gained a marginal 2.1%.
Some commodities recorded increases. Gold output rose year-on-year, while iron ore and chromium ore also showed gains. These improvements were not sufficient to offset the declines in other key sectors.
Earlier this month, US President Donald Trump slapped South Africa with 30% tariffs on goods exported to America, based on an alleged trade imbalance, excluding precious metals.
Gold, silver, platinum, and palladium are used in high-technology and electronics manufacturing and are found in components such as processors, circuit boards, connectors, and memory systems.
In the context of artificial intelligence (AI), demand for advanced computing hardware has increased, and these metals play a role in the performance and reliability of AI-related infrastructure. AI chips, servers, and related technologies often rely on materials that include these metals.
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Trump has expressed support for expanding the US's AI capabilities, including investment in domestic semiconductor production and research. He has also advocated limiting access by geopolitical rivals to advanced US-developed AI technology.
Domestically, South Africa's mining sector continues to be affected by infrastructure and operational constraints. Investec economist Lara Hodes said that 'bulk mineral exports continue to be impacted by the country's logistical challenges, including port and rail inefficiencies, leading to billions of rands in lost revenue'.
Creating a world-class logistics system to drive export growth remains a key priority of government, said Hodes. 'Dealing with the other challenges that impede the country's competitive position remains imperative,' she adds.
The Minerals Council South Africa has stated that the mining industry continues to play a central role in job creation, foreign exchange earnings and industrial development.
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