CHINA July 28 2016 11:15 AM
NEW YORK (Scrap Register): A report suggests that China’s gold production may have hit a plateau, which presumably would mean more future imports by the country that would be gold supportive, said HSBC.
Analysts cite an article in Shanghai Securities News quoting the China Gold Association as saying that production in the country may be flattening. The association reported domestic gold production at 229.1 tons in the first half of this year, up just 0.2% from the same period a year earlier.
China produced 450.1 tons of gold in 2015, down 0.4% from the previous year. China leapfrogged into first place among gold-producing nations by increasing output at double-digit annual rates for more than a decade, said HSBC.
Meanwhile, China’s consumption of gold has been growing, far outstripping domestic production. The latest data confirm the flattening out of production in 2015.
If China’s production is topping (the United States Geological Survey reports China has relatively low gold reserves compared to other major producers), then increases in China’s demand for gold going forward will have to be satisfied by imports, with a commensurably supportive impact on prices, the bank added.