China remains a key driving force in the global gold market and will continue to drive innovations in the industry in the coming years, said David Tait, CEO of the World Gold Council (WGC), at the China Gold Congress held in Shanghai on July 27-28.
“Thanks to strong Chinese economic growth over the past decades, China has secured a leading position in the global gold market. For over 10 consecutive years, China has been the world's largest gold consumer, and for an impressive 15 consecutive years, it has been the world's largest gold producer,” he said.
He is therefore convinced that China has a significant influence on shaping the future of the global gold mining industry. The Chinese gold market, Tait noted, “will continue to drive innovation in the global gold market for many years to come, particularly in key areas such as gold bar integrity, digitalization and responsible supply chains, and artisanal mining.”
According to data released at the China Gold Congress 2024, the country’s gold output in the first half of this year reached 179,634 tonnes, while gold consumption was 523,753 tonnes.
The price of the precious metal rose 12% in the first half of the year, which, according to Tate, was driven by sustained central bank purchases, robust consumer demand in Asia, burgeoning global debt and geopolitical uncertainties. Almost a third of the world’s central banks plan to a further increase their gold reserves over the next 12 months, the highest level since 2018.
Meanwhile, according to the China Gold Council’s quarterly report, gold demand in the country has cracked in the face of record-high prices for the precious metal, and sales at the country’s jewelry stores have fallen.
Thus, total demand for bullion fell by almost 6% to 524 tonnes compared to the same period last year. In the next quarter, jewelry purchases are expected to decline by 52%.
The council said jewellery purchases fell 27% in the first half of the year, partly offset by sales of bars and coins, which jumped 46% from a year earlier. China-focused major gold retailers including Chow Tai Fook Jewellery Group reported a significant drop in sales for the quarter ended June, while imports of Chinese bars fell sharply last month.
Hélène Tarin, Editor-in-Chief of the Asian Bureau, Rough&Polished
