At the start of the 2016 year, gold was trading at US$1,061 an ounce.

It’s now US$1,246 an ounce, having risen on the back of uncertain global economic conditions, fears about global growth amidst a plunging oil price.

In Australian dollar terms, we are looking at a price of A$1,747 an ounce – a similar price to when gold shot up to US$1,800 an ounce in 2012 and the Aussie dollar was trading at around US$1.10.

As you’d no doubt expect, Australian gold miners and their share prices are going nuts.

There are at least 10 gold-related companies in the top 20 best-performing shares on the ASX since the start of this year, including Millenium Minerals Ltd (ASX: MOY), Gascoyne Resources Ltd (ASX: GCY) and Resolute Mining Limited (ASX: RSG). The three companies’ share prices are up 272%, 177% and 150% respectively.

Other gold miners that have seen their share prices rocket up include:

Even two of Australia’s largest gold miners, Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) are up 39% and 44% respectively – and it’s mostly about the gold price.

What is interesting is that with a number of countries introducing negative interest rates including Japan, Europe, Switzerland, Denmark and Sweden in recent times, makes gold more appealing than bank deposits. Gold doesn’t pay interest but Swedish banks are charging customers -1.1% on deposits. Negative interest rates are also forcing investors out of cash and into many other asset classes.

The goal of many Australian gold producers now is to make as much while the sun shines. With rough all-in sustaining costs of between A$900 and A$1,100 an ounce, its’ quite clear that gold miners should produce stunning profits this year – that is, if they can keep their other costs down.

Foolish takeaway

Unfortunately for shareholders, much of the profits are likely to be poured into more exploration holes, drilling and expanding resources. Very few gold miners pay dividends, and when they do, they are mostly small and virtually inconsequential. They are also likely to be cut when gold prices fall – which they will at some stage.

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Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. You can follow Mike on Twitter @TMFKinga

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.