A programme of research and development designed to increase productivity and efficiency in gold mining has been initiated by the Chamber of Mines of South Africa at a cost of between R100 million and R150 million over the next ten years. This is designed to offset rising costs by the fuller utilisation of existing equipment and by greater mechanisation in the future, as well as to ensure the continuity of supplies. The gold resources of the Witwatersrand basin are immense. From reefs in this geological formation some thirty-two million kilograms of gold (about 1,000 million ounces) have already been extracted and there is probably more gold than this in reefs still to be mined. How is it then that with the higher price of gold the output of gold from this area, which constitutes over 70 per cent of the gold production of the Western world, has tended to decrease ? What is the significance of the fact that the gold output from this area declined in 1973 ? The facts are that there are a large number of mines exploiting reefs of the Witwatersrand series, that the gold content of these reefs is variable, and that many mines are thus able, by selection of the reefs and areas of reefs which they mine, to control the gold grade of the ore fed to their mills. It is largely for this reason that such mines were able to survive over the years during which the price of gold was fixed, but during which costs were steadily rising and mines becoming deeper. During this period they were able to increase the average grade of ore mined to offset increases in costs. The implications of this for the industry as a whole were, however, serious since it resulted in large areas of `undergrade' or `non-pay' reef being left unmined. The lives of the mines were being progressively shortened. The increased price of gold has meant, however, that most mines have been able to lower the average grade of the ore which they mine. In 1973, for example, this average grade was decreased by an average of 10 per cent. Even though the actual tonnage of ore milled was increased from seventytwo to seventy-five million metric tons, this meant that overall gold output decreased by 6 per cent. The higher price for gold is therefore having the unexpected effect—in the short-term—of decreasing the availability of gold from this major source of supply. In the longer term, however, it should ensure the fuller exploitation of the reefs of the Witwatersrand basin and therefore stabilise the supply of gold from this source much further into the future.