⚠ Grade Declines on a ScheduleModerate threat
Barrick Mining (B) — threat to the moat
Halve the grade and you roughly double the cost per ounce; lowering the cut-off grade grows reserves and raises future costs in the same decision.
Grade is the single most important variable in mining economics, because the cost of moving a tonne of rock is roughly the same whether it contains three grams of gold or one. Halve the grade and you roughly double the cost per ounce.
Mature operations mine declining grades as a matter of geology rather than of management, and the effect compounds quietly. It shows up in the cost line rather than as an announcement: Barrick's all-in sustaining cost rose about 10 percent in 2025 to $1,637 an ounce, with 2026 guided to $1,760 to $1,9501, and only part of that is inflation.
There is a manoeuvre that hides it, and it is worth knowing about. Lowering the cut-off grade — the threshold at which material counts as ore rather than waste — increases reserve tonnage and reduces reported grade at the same time. It looks like reserve growth and it is a decision to mine poorer rock, which raises future costs. A high gold price makes that decision look sensible and permanent, and it is only the first of those.
The genuine defence is that Barrick's flagship orebodies are large enough and high-grade enough that the decline starts from an unusually good place.
Watch reserve grade alongside reserve ounces. Tonnage that grows while grade falls is not the same as a discovery.
- ReportedBarrick's all-in sustaining cost rose about 10% in 2025 to $1,637 per ounce, with 2026 guided to $1,760-$1,950.Gold-miner peer comparison, 2025 results and 2026 guidance — Newmont led global production with 5.89 million attributable ounces in 2025; Agnico Eagle secured the number two global position with payable gold production of 3.447 million ounces, exceeding Barrick's 3.26 million ounces by nearly 200,000; Barrick's all-in sustaining costs rose 10% year on year to $1,637 per ounce in 2025 and are guided to $1,760-$1,950 for 2026, with cash costs of $1,330-$1,470 against $1,199 in 2025, while Agnico guided 2026 AISC of $1,400-$1,550 per ounce; Agnico trades at a forward twelve-month earnings multiple of about 11.5x, roughly 21.7% above the industry average of 9.48x; AngloGold and Agnico Eagle separated themselves from the pack through superior cost control and jurisdiction management while Barrick struggled with geopolitical friction, notably the dispute with Mali's authorities over the Loulo-Gounkoto complex — FY2025 / 2026 guidance · publ. 2026 · source ↗