Goldprice: is Barrick Gold starting to struggle?

The gold price is currently experiencing a setback after the yellow metal rose yesterday after the US interest rate decision. But the rally is now overheated. Cooling down would not only be normal, it would also be healthy. The share of the world’s second largest gold producer Barrick Gold has recently been unable to keep up with the rise in the gold price. The advance figures that the group has already reported are one reason for this rather below-average development.

Good, so far
So far, Barrick Gold has come through the corona pandemic well. However, there are still traces in the figures for the second quarter. Not only, but also through Corona. Production in the second quarter was just under 1.15 million ounces of gold, in the first quarter still 1.25 million ounces were produced – so it was around 100,000 ounces lower. On the one hand, the shutdown in Argentina made itself felt here, and on the other hand, the dispute in Papua New Guinea, which led to the – temporary – closure of the mine. However, since Barrick had already lowered the annual forecast by 200,000 ounces, the new forecast of 4.6 to 5.0 million ounces for the full year should be achieved. The situation is somewhat different when it comes to costs, CEO Mark Bristow warns that these will be higher than initially expected. The costs in the second quarter should be seven to nine percent above expectations. Certainly, all of this should be offset by the significantly increased gold price. Barrick had an average selling price of $ 1,711 in the second quarter, significantly more than the $ 1,589 in the first quarter. Nevertheless, it somewhat dampens the margin.