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The mining sector has delivered a windfall tax revenue bonus (worth between R40 billion and R70 billion) this year. This is something the sector does from time to time, the most recent previous occasion being the post-Covid boom of 2021 and 2022, when it was said to have “saved” (i.e. compensated for) the budget deficit.

Most famously, the dramatic rise in the gold price in 1979 and 1980 (from about $200 to over $800) provided South Africa with a multibillion-dollar financial lifeline during a period of acute fiscal distress stemming from the capital flight that followed the 1976 Soweto uprisings.

In 2026, soaring gold and platinum prices have more than masked falling physical output. In fact, South Africa’s total mining production fell 12.7% year on year in August 2026, marking four straight months of contraction. But this is only a snapshot of a much deeper and longer decline. According to the Bureau for Economic Research at Stellenbosch University, real mining output has shrunk by 11.5% since 1994.

The chart below tracks South Africa's mining production since 1994, using January 2019 as a reference point, with production in that month assigned an index value of 100. A reading above 100 indicates that mining output was higher than the January 2019 level, while a reading below 100 indicates that output was lower. The figures are seasonally adjusted and presented as a three-month moving average to smooth out short-term fluctuations. The chart shows that mining production has declined considerably from its mid-2000s highs. By 2026, output was approximately 10% below its January 2019 level and roughly 20% below the levels recorded around 2004.

The country should not expect future mining windfalls to be as valuable. There has been almost no greenfield exploration since mining resources were expropriated in terms of the Mineral and Petroleum Resource Development Act (MPRDA), which came into effect in 2004. In that year, South Africa accounted for 5% of global exploration spend, worth a nominal R6.2 billion. Exploration figures subsequently collapsed. In 2026, exploration spend in South Africa is worth a miserable R750 million, 85% lower than when the MPRDA was passed.

The chart below shows mining exploration spend in South Africa as a share of global exploration spend since 2004.

Almost all of this expenditure is on brownfield projects, intended to maintain and marginally expand existing operations. One major mine, Valterra Platinum’s Mogalakwena in Limpopo, is transitioning from an open pit to an underground operation, a clear signal that the cheapest and most accessible ore has been depleted. This does not mean that Mogalakwena – famous as the world’s largest open-pit platinum mine – is anywhere near the end of its life. But it is an example of how middle-aged, or even older, almost all of South Africa’s major mines are. Only Gold Fields’s South Deep mine can be described as young.

The consequence of the collapse in spending on exploration is that the pipeline of new greenfield mining developments is all but empty. Even the few mines that have been developed in South Africa this century are based on old geological information. The Burnstone gold mine, reopened near Balfour last week, was originally founded on data drilling that began before the MPRDA was implemented.

Vedanta’s Gamsberg zinc mine near Aggeneys in the Northern Cape, which opened in 2015 and announced a substantial capacity increase this week, works deposits discovered in 1972. Orion Minerals is reviving copper and zinc sites in the Northern Cape – at Prieska and Okiep – which were previously mined by Anglo-Vaal and Newmont. Copper mining in Okiep goes back over 300 years. The Steenkampskraal rare earth mine in the Western Cape, which has excited considerable interest, not least in the United States, on account of the quality of its monazite deposits, is a development of a much older Anglo-American operation that ran from 1952 to 1963.

One of the most telling indicators that operations are tied to old sites is the massive rise in surface tailings (mine dumps) retreatment. Instead of drilling new shafts, companies are using modern technology to extract critical minerals and gold from historic waste dumps and mine tailings left behind by previous generations. Rainbow Rare Earths is extracting rare earth elements directly out of old phosphate waste heaps in Phalaborwa, while Pan African Resources’ highly automated operation recovers gold from mine dumps on the West Rand.

Geological data should not be seen as information tied only to a specific time and place. It is cumulative, which is why in booming exploration jurisdictions, failed exploration projects are as valuable as successes. Significant discoveries are often made as a result of a second or third look at older data. This is precisely what has happened in the South African copper, zinc, and rare earths examples above. In the case of Steenkampskraal, the original mine was intended to produce thorium, an early nuclear fuel later replaced by uranium. The monazite so valued today was simply a waste product back then.

This accumulation of data, negative and positive, is part of a country’s mining heritage and is one reason it takes decades to build up a healthy, thriving industry. Data should be curated and made publicly accessible by the Council for Geoscience. But this requires reliable inputs from the Department of Mineral and Petroleum Resources, and that has not happened for many years. The department has been unable to provide standard data such as exploration metres drilled for each commodity. Such data is standard in Canada, where it is curated by the Provincial and Territorial Geological Surveys.

Mining windfalls are driven by international mineral prices, which are of course beyond the control of the South African authorities. But to benefit, a country has to be in the resources game in the first place, and South Africa is slowly slipping out of contention. South Africa has the resources but extracting them requires a better enabling environment.