Smart businesses of all kinds spend at least some time trying to predict the future so that they can anticipate trends and opportunities to generate revenue. Mining companies are no different in that respect, and many mining company CEOs are warning about a crunch in the gold supply in the coming year.
Several reasons are to blame, but, among those reasons, are difficulties in accessing and maximizing the production from current sources. For example, Sean Boyd, President and CEO of Agnico Eagle Mines Ltd. said:
“Grades are down, projects are tougher, they’re more remote, which makes it a much more challenging business right now. The industry is allocating less to exploration to make new discoveries, or allocating less money to the pipeline – so, the pace of the projects moving through that pipeline is slowing down, that’s going to impact supply.”
What this means, in practical terms, for you and me is that a constriction in supply seems to be a prediction of increase in price. We would be wise to do our own forecasting of how we want to allocate our funds in 2015 and factor this into reaching our personal financial goals.