Global gold mine production hit a record high in the third quarter of 2026, yet overall gold supply still declined by 1 percent. Mines worldwide produced 1,071 tonnes of gold, the highest third-quarter output since 2000, according to the World Gold Council. Year-on-year, gold mine production rose by 2 percent, putting it on track for an annual record. Major gold producers reported significant increases, with Canadian mines seeing a 22 percent boost, Indonesia up by 21 percent, and Chile and Ghana reporting 19 percent and 13 percent increases, respectively.
Despite the surge in production, the cost of extracting gold is rising rapidly. Average all-in sustaining costs (AISC) reached a record high of US$1,930 per ounce in Q2, an 8 percent quarterly increase and a 22 percent rise over the last year. Analysts noted that price inflation in the mining industry is accelerating much faster than the 5 percent five-year average. The World Gold Council attributed this to higher energy and consumable prices, as well as increased sustaining capital expenditures.
The decline in gold supply was primarily due to an 8 percent drop in recycling, which fell to 314 tonnes in Q3. Lower gold prices and expectations of future price recoveries contributed to depressed recycling levels. In India, recycling volumes were flat quarter-on-quarter but fell 12 percent annually, attributed to lower gold prices and a preference for pledging gold as collateral. Chinese recycling also dipped by 12 percent quarter-on-quarter and 20 percent annually, influenced by a 7 percent VAT on jewelry sales. Meanwhile, recycling rose by 12 percent annually in Europe and by 8 percent in the U.S.
Producer de-hedging also reduced the gold supply by 17 tonnes in Q3. Many gold miners hedge future output to protect against price drops, but this practice has declined as miners forfeit additional profits if gold prices rise above hedge prices. The World Gold Council expects supply to contract slightly in 2026, with lower recycling volumes likely to persist in Q4. Analysts noted that despite higher inflation and some signs of unemployment, there is little evidence of distress-driven selling, reducing the likelihood of a sharp release of recycled gold.