South Africa is reported to be preparing itself for the next wave of commodities boom, with gold mining in particular set to undergo something of a re-birth in the near future.

According to news portal, there’s something of a mixed outlook ahead for the South African mining industry. While the gold sector could be on the rise again, weak demand for diamonds, copper, iron ore and platinum is set to continue in the short term.

Furthermore, a number of obstacles need to be overcome before any boom can be exploited, such as skills shortages and problems over electricity supply.

The mining industry is engaging with government and labour to ensure that the sector is ready to take advantage of the next commodities boom, South Africa’s Chamber of Mines (CoM) chief economist Roger Baxter reportedly said of late.

Speaking at a conference hosted by the Steel and Engineering Industries Federation of South Africa (Seifsa), in Johannesburg, Baxter is believed to have emphasised that there would be another commodities boom, but it was unclear when it would happen and whether South Africa was ready for it.

The industry would need to have the right infrastructure in place for the next commodities boom, having largely missed out on the previous commodities boom, owing to electricity shortages, infrastructure constraints, regulatory constraints, and a shortage of skilled people.

The country’s mining output is likely to decline further during 2009, as a result of the global economic downturn, with weak demand for gold, diamonds, copper, iron-ore and platinum would continue in the short term.

Gold is providing a fillip in the long term however, with the sector experiencing a rebirth, especially amid the potential impact of inflation. The most commonly used process for extracting gold from complex, low grade ore is a metallurgical technique commonly known as the cyanide process.

This technique converts gold into water soluble aurocyanide metallic complex ions. Oxygen is one of the re-agents consumed during dissolution of gold into the cyanide solution and insufficient available oxygen can delay this process.

Air is often bubbled through the pulp and where economically viable, this air stream is enriched with pure oxygen, to increase its concentration.

Gold prices are expected to be above $1 000/oz next year, with gold seen as a logical part of any investment portfolio.