The “most expensive metal in the world” is gold. In terms of raw material costs, gold is the “most expensive” in the world. The price of gold has increased dramatically, from $250 dollars in 1950 to the current price of $1,081 (yes, I’m going to throw a decimal point in for the sheer number of times I have to do that). But what about the cost of mining gold?
Let’s start with an easy question. How much did the world produce in 2014? This comes from a new report from the Congressional Research Service that is out today. The amount of gold produced in the world in 2014 was about 2.56 billion ounces. That’s more than twice as much as in 1950 (1.39 billion ounces). This is in spite of a 40 percent increase in world population of nearly 1 billion people.
If you are a miner in any part of the world, your profits are now the highest in a century of mining! The mining of gold is also known as “mining the sun”. That name was probably chosen because the sun appears almost unaltered from its original form as a brown dot in the sky. At one time, miners would wait for a sunspot to rise, and then drill into the earth. When a sunspot appeared, it would start shining as the ore was removed. In the early 1900’s, this was called “gold mining”.
When did we stop mining gold? The answer is 1845, as mining began on a much larger scale. If you want to get back to the 1950’s question, we were in for a big shift in our mining methods. A couple of key things have gone into the switch to a “full range” production method. First off, in the past, the extraction of gold ore took about 7-8 months at today’s prices. In the past this process was also somewhat labor intensive. In the late 1950’s, with the rise of the domestic market, we switched to a “full-range” production method. That means that the production of gold ore in mines is continuous. That means if we have a good time at the mine, and then some rain starts coming down, we can continue to work until the next production period comes around! As we will see, that’s just not the same as it was 50 years ago. But to come back to the question, the production of silver today is about 80 percent of what it was in 1850.