China 2013 gold supply shortfall seen at 700 tonnes

December 5, 2013 at 10:56

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China’s gold supply shortfall is expected to reach 700-800 tonnes this year due to strong physical demand, an official with the World Gold Council (WGC) said on Thursday.

“In addition to domestic production of over 400 tonnes, the total consumption (in China) is seen to exceed 1,000 tonnes this year,” Zheng Lianghao, managing director of the WGC’s Far East division told a conference in Shanghai.

Zheng said physical demand in China and India, the world’s top two consumers, remained strong in the third quarter even though sharp falls in gold prices have weakened investment.

Demand from China has jumped nearly 40 per cent this year as the appetite for jewellery, bars and coins increased sharply due to a sharp drop in gold prices.

Fourth-quarter demand is expected to remain strong as buying picks up ahead of the Chinese New Year at the end of January.

China, also the world’s top gold producer, produced 307.8 tonnes of the bullion for the first three quarters also the world’s top gold producer, produced 307.8 tonnes of the bullion for the first three quarters, up 6.8 per cent from a year ago, and output is expected to rise to 430 tonnes this year.