Record Gold Prices Outpace Rising Mining Costs in Q1'26

The World Gold Council reported that record gold prices outpaced rising mining costs in Q1'26, resulting in unprecedented margins and cash flows for gold producers.

The global average gold producer All-In Sustaining Costs (AISC) rose by 16% year-on-year to $1,785 per ounce during the first quarter of 2026. Escalating royalty payments were the primary cost driver for the quarter, with spot gold prices reaching historic highs and momentarily touching $5,595 per ounce in January.

The report noted that fiscal regime changes and growing resource nationalism in West Africa also accentuated cost burdens across several jurisdictions. For example, Ghana introduced a sliding scale royalty system in March, while Burkina Faso introduced a sliding system in 2025. As a result, royalty expenses surged by 220% year-on-year at IAMGOLD's Essakane mine in Burkina Faso.

Despite these cost increases, average gold prices rose by 70% year-on-year, driving average AISC margins up by 134% to a record $3,076 per ounce. The report highlighted that miners maintained strict capital discipline throughout the period, directing substantial cash flows toward dividends and share buybacks.