By Thanda Sithole
Mining production (not seasonally adjusted) declined again in March by 2.8% y/y after falling by 9.7% y/y (previously -9.6%) in February. This marked five successive months of annual decline. Seasonally adjusted mining output expanded by 3.5% m/m, reflecting a rebound from a 4.1% monthly decline, better than the previously recorded fall of 4.4%. Still, the data confirms that the mining sector dragged GDP growth during the first three months of 2025, with output having contracted by 4.5% q/q, worse than the 0.7% contraction recorded in 4Q24. This, together with the quarterly weakness recorded in the manufacturing and electricity sectors, poses a downside risk to the 1Q25 GDP growth estimate. The remaining high-frequency data to be published over the next two weeks will give a clearer picture of how the economy performed in 1Q25. At this stage, we pencil in 0.2% quarterly GDP growth for 1Q25, which is lower than the 0.6% quarterly growth recorded in 4Q24.
Outlook
Near-term mining activity remains challenged by slowing global growth and lingering global uncertainty. While output increased slightly by 0.4% in 2024, the year-to-date performance has been disappointing, with output down by 4.7% in the first three months compared to the corresponding period last year. This suggests that the mining sector's contribution to 2025 GDP growth will be negligible or even negative. The medium-term outlook should be underpinned by ongoing infrastructure reforms, particularly in energy and logistics.
Selected sector analysis
Four out of twelve mining divisions recorded annual declines in March. Among the five major divisions:
On the upside:
