Editorial Looking ahead to 1989

So what do we see ahead for 1989?

First of all, in exploration, we see a more active year ahead than the one that just ended. Many of the mines that opened in 1988 and that will open in 1989 were helped along by the impetus to exploration provided by flow-through funding. The stock market crash of late 1987 and the government tampering with the flow-through mechanism made it very difficult to raise money for mineral exploration in 1988. In 1989, however, the new Canadian Exploration Incentive Program for flow-through financing will begin to attract investors in greater numbers. Combined with better gold prices and a generally healthy economy, 1989 will be an active year for exploration, perhaps not at the heady levels of 1987, but certainly at or better than 1988’s levels.

But in 1989 there’s bound to be plenty of unhappy news as well. Several new mines will report start-up problems that can’t be solved. The Northern Miner calculates that 18 mines are scheduled to begin commercial production this year. Not all of them will survive into 1990. With 19 new mines opening in 1988, there were four that suffered major setbacks or outright closure. The same is likely to happen in 1989.

Those mines that are put on the pile marked failure will receive adequate attention, we’re sure. The ones that will be less often discussed will be the successful operations that quietly go about their business day-in and day-out. Some examples from the Class of ’88 are Winston Lake, Kremzar, Golden Patricia and Casa Berardi from the Class of ’88.

As far as commodity prices go, it’s almost impossible to hit such moving targets; but that seldom stops would-be fortune tellers from taking a shot anyway.

Gold will touch $500(US) an ounce by mid-year as the dollar weakens following George Bush’s inauguration, but increased supplies — from Soviet sales to earn foreign currency for the reforms of “perestroika,” not from increased mine production — will keep the lid on gold in general. It will close the year at $460 but average about $440 in 1989.

Copper will also peak, then fall back. It won’t go any higher than $1.70(US) a pound on the spot market, but will close the year at about $1.20 and average about the same. Zinc will hang in at 50-55 ; lead will average 24 cents

Nickel will probably be the most volatile of all the metals trading between $3(US) and $9 per pound but averaging near the middle at $5.

But perhaps the safest prediction to make is that in 1989 something totally unpredictable will come to pass.

It happens every year.

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