While precious metal investors cheer gold’s relentless rise in 2024, some investors are learning the hard way about political risk in certain international gold mining jurisidictions…

For years, we’ve written about the perils of resource nationalism and why it’s critical investors understand the geopolitical and geographical risks of gold mining. As is often the case, North America is home to many of the safest gold mining jurisdictions in the world, and early in a cycle capital flocks to the well-known gold hot beds in Canada, the United States and Mexico.

However, as gold soars to new heights, investors are looking internationally for opportunities, which often carries more risk than North American plays. Additionally, ‘mining gold’ may not be the only way to play the market as researchers are looking to extract high-purity gold from old electronics.

Burkina Faso | Resource Nationalism

As the price of gold rallies, contempt for foreign miners will likely increase in many nations, particularly in African ones.

Recently, the rise in price seemingly became too much for Burkina Faso, as President Ibrahim Traore expressed a plan to withdraw mining permits and promote indigenous mining establishments. In short, the country wants to increase gold autonomy by clawing back foreign miners’ interests and increasing local ownership. We’ve seen this story play out many times before, particularly in bull markets…

Endeavour Mining, one of the world’s largest gold producers, with assets in Burkina Faso, was hit hard Monday morning, falling more than 3% on the day.

For a costly, and recent, example of resource nationalism, one just has to look at First Quantum’s Cobre Panama. The Canadian miner financed and built one of the largest new copper mines in the world only to see the Panamanian government renege and effectively nationalize it, inflicting massive losses on the miner and its shareholders.

A must read for mining investors is the Annual Survey of Mining Companies, 2023, published on May 14, 2024. It is a report by the Fraser Institute that “…assesses the impact of mineral endowments and policy factors on attitudes toward exploration investment.”

Top 12 Gold Mining Nations

While gold has recently pulled back, it has spent the better part of the year making new, nominal highs, thereby increasing the profits of many of the world’s largest gold miners. So, who has the gold?

In a recent YouTube Short, we document the world’s top 12 gold-producing nations.

Urban Mining: Recycling Your Way to Riches

Interestingly, one ton of e-waste can contain about 0.5 to 1 gram of gold, while traditional gold mining produces only 1-2 grams of gold per ton of ore.

In cen.acs.org’s “Electronic waste is a gold mine waiting to be tapped,” they explain the magnitude of just how much e-waste the world creates each year:

“Globally, people discarded a record 62 million metric tons (t) of electronics, according to the United Nations’ recent Global E-waste Monitor 2024 report. That’s the weight of over 1.7 million fully loaded semitrailer trucks, which, if lined up bumper to bumper, would reach almost around the equator.”

Furthermore,

“And that trash contains treasure. Metals made up half the world’s electronic trash, or e-waste, in 2022 and were worth $91 billion. Copper, iron, and gold accounted for a big chunk of that value.”

Swiss Target Gold Extraction From E-waste

Swiss refineries process around 60-70% of the world’s newly mined gold every year. This includes gold mined globally and from recycled sources such as jewelry and electronic waste; and the amount of gold extracted from e-waste recycling may be about to increase…

A group of researchers in Zurich, Switzerland, have discovered a new method for extracting high-purity gold from old electronics.

In typical Swiss fashion, cheesemakers were involved. They used whey, the watery portion of milk that separates from the curds when making cheese, as an absorbent to remove gold from e-waste.

Wrapping Up

As gold’s bull market continues amidst massive devaluation of fiat currencies, investors and countries will compete for supply of the precious metal. And, as gold becomes too expensive for nations to purchase from refineries, short-sighted governments will seize mining assets, or a portion of them, in their home countries.

As the cost of living continues to rise unabated at the behest of the money printers, millions of people, from governments to citizens, will turn to gold as one way to preserve purchasing power and autonomy.