Johannesburg — Mining production dropped 1% in July 2010, compared with July 2009, according to data released by Statistics South Africa (StatsSA).

Those figures were released by StatsSA a day after LONMIN CEO Ian Farmer urged Mineral Resources Minister Susan Shabangu to show strong leadership to help settle investors' nerves and reverse the damage done to SA's mining industry by a blend of ambiguous laws, empowerment demands and a vague Mining Charter.

The latest stats come after a 4,9% year-on-year (y/y) decline in June 2010.

Data indicated that for the three months ended July 2010 mining production decreased 4,9% compared with three months ended April 2010.

Despite South Africa's previously eminent role in Gold production, the stats for July indicate that the small increase is mainly due to a jump in iron ore sales.

These increased 7,2% of R4,8bn.

Gold didn't completely disappoint, rising 4,9% or R3,3bn.

At a Gordon Institute of Business Science forum last night, it became clear that the regulatory environment must change to give investors and mining firms confidence in SA as a business destination and contribute towards the transformation of the sector.

This is important given the strident calls from factions in the African National Congress and its alliance partners for greater state involvement in mining to ensure benefits are more widely felt.

Mr Farmer and Peter Leon, a mining regulations expert at the law firm Webber Wentzel, both criticised the regulatory environment for holding back the mining sector. They listed ambiguities and gaps in the Mineral and Petroleum Resources Development Act and a lack of administrative capacity.

For the June quarter 2010, the total value of mineral sales at current prices increased 8,2% or R4,5bn compared with the March quarter 2010.