The demand in China for gold has been incredible. Not only does China retain all the gold it mines, it continues to import the yellow metal at a blistering pace. Depending on which source you reference this number can change drastically. This difference in reporting, prompted an open letter to the World Gold Council by Eric Sprott. Eric believes that the “official” numbers released by the World Gold Council are drastically under-reporting the real numbers.
Many in the precious metals community agree. Including Alasdair Macleod, who recently released a report following up on Eric’s letter. Alasdair, breaks down the numbers and shows exactly how wrong the World Gold Council is. The difference is extreme.
Using the WGC numbers, the predicted annualised importation of gold into China will equal 1,091.5 tonnes of gold. Alasdair, in contrast uses the information released by the Chinese government. The number he comes up with is quite different. For the first nine months of this years (according to the hard facts) China has imported a total of 2,130.7, or 2,841 tonnes annualised. A 1,749.5 tonne difference!
Supporting Alasdairs numbers, is the world’s largest jewellery group, Chow Tai Fook Jewellery Group Ltd. which saw sales jump by 49% in the first half of this year!
The question many in the precious metals community have is why does the WGC continue to downplay the demand for precious metals? Why do they continue to release low quality reports that use inferior data? Perhaps this is simply more MOPE?