Gold prod.in S-Africa in 2008 sank to its lowest level since the Boer war,pushing the country into third place in the league of global producers behind China and the US.

The country's gold output dropped by an est.14%,the sharpest decline since 1901.

S-Africa gold production sank to a provisional 232 tonnes,down 38 tonnes on 2007,amid severe power supply limitations,an industry-wide skills shortage and an overhaul of mine safety procedures.

Graham Briggs,ceo of Harmony,the world's ninth biggest producer and one of S-Africa's three gold majors,said he saw little prospect of a sharp revival in the country's gold production.

To build a deep mine these days needs massive capital.That is not likely to happen in the future,said Mr Briggs.

GFMS(the precious metal consultancy which relaesed its Gold Survey 2008 yday)said Gold prices could be expected to reach a fresh all-time high above $1000 an ounce in the first half of 2009,as investors focused on the possible return of inflation and the treat to the dollar caused by aggressive interest rate cuts and massive gvmnt spending.

GFMS said that the strong investor demand had been masked by heavy selling by hedge funds which required cash to cover losses elswhere,meet margin calls and pay for redemptions.If it had been for this fund selling we'd be easily back over $1000 by now.

Inca hopes we still have Windfall.Maybe news out this week before the Vancouver conf.?

Greetings,

Inca.