The June 2011 issue of the Gold Mine Cost Report, published by ABN AMRO Bank and VM Group Haliburton Mineral Services, examines the changes in gold mine production cash costs in Q1 2011. Growth in average gold mining cash costs rose by 1.8% on the quarter, to $620/oz.

On a year-on-year basis, the average cash cost for gold mines escalated by 13%, from $551/oz in Q1 10. The average gold price in Q1 11 of $1,387/oz ensured gold miners continued to enjoy huge margins between the average cash cost of production and the gold price, with the difference nowhere more notable than in Latin America where it stood at $891/oz.

Notably, since the weak US dollar has contributed to higher cash costs in gold producing countries, in North America the difference between the average cash cost and average gold price in Q1 2011 was $841/oz.