Yet another new China gold production record in 2010 - Lawrence Williams - Mineweb
China, the world's largest gold producer each year since 2007, has further increased domestic gold production in 2010 with an 8.57% rise over the previous year's output.
LONDON -
We reported a couple of months ago that China's gold production was heading for yet another new record and, according to the China Gold Association, this is indeed the case, having reached 340.88 tonnes in 2010 - a rise of 8.57% over the previous year's figure. China was already the world's largest producer of the metal before this latest increase and will thus comfortably have retained this position again.
Together with record gold imports in 2010, China is challenging India as the world's largest consumer of the metal too. There is also the suspicion that much of the country's own output, supplemented by gold processed in China on behalf of overseas companies, either as a byproduct from base metals concentrates shipped to Chinese smelters, or in bought-in production sent to China for final processing from other gold mining operations, is being taken into government coffers thus boosting the country's gold reserves. On past reporting patterns any such boost to China's official gold reserves may not be reported unless and until it suits the country to announce this.
There is little doubt now that China is a very considerable player in world gold consumption. It has a population pre-disposed to buy gold as a protector against inflation, which is already rearing its head, and against the vagaries of the very volatile Chinese stock market. If the country is indeed also boosting its reserves it also has the power to strongly influence price patterns going forwards. While it may not be in the country's best interests to see gold rise too fast, it may also wish to limit any downside given the increasing precious metals investment by its citizens - by all accounts an investment that is being encouraged by state-owned institutions and media.
Thus, if China feels that gold may be drifting downwards in price faster than it would like don't be too surprised if it announces a new boost in its gold reserves sooner rather than later - or at the least a policy statement suggesting that it intends to do so.
No comments:
Post a Comment