China Gold Association: China's gold production in the first half of the year was 179.634 tons, a year-on-year increase of 0.58%
The China Gold Association has released data on the country's gold production in the first half of 2024, totaling 179.634 tons, a year-on-year increase of 0.58%. Among them, gold produced from gold mines amounted to 141.496 tons, while by-product gold from non-ferrous metals reached 38.138 tons. In addition, imported raw materials yielded 72.026 tons of gold, a 10.14% increase compared to the previous year. Overall, the country produced a total of 251.660 tons of gold, marking a 3.14% year-on-year growth. This result is mainly attributed to the capacity adjustments and production optimization of gold enterprises and large-scale gold smelting companies, as well as the growth in gold production from some large gold mines. However, aging mines are facing gradually declining easily accessible resources, while new mines encounter challenges in deep well construction, leading to production reduction, closure, or restructuring of some gold mining companies. Domestic gold production accounts for 47.95% of the national total, while overseas mines achieved a 19.00% year-on-year increase in gold production. Overall, although China's gold production did not grow as expected, it still maintains a stable growth trend
According to the Zhitong Finance APP, on July 28th, it was revealed at the 2024 China International Gold Conference that in the first half of 2024, the domestic raw gold production was 179.634 tons, an increase of 1.036 tons compared to the same period in 2023, with a year-on-year growth of 0.58%. Among them, gold produced from gold mines reached 141.496 tons, and by-product gold from non-ferrous metals reached 38.138 tons. In addition, in the first half of 2024, the imported raw gold production was 72.026 tons, a year-on-year increase of 10.14%. Including this imported raw gold production, the total gold production in the country reached 251.660 tons, a year-on-year increase of 3.14%.
In the first half of 2024, gold mining enterprises and large gold smelting enterprises seized the opportunity of high gold prices, adjusted their production capacity structure, optimized production layout, maximized the utilization of gold resources, and achieved significant results. Large gold mines such as Sanshandao Gold Mine in Shandong, Zhaizigou Gold Mine in Gansu, Bilihake Gold Mine in Inner Mongolia, and Duobaoshan Gold-Copper Mine in Heilongjiang all saw a year-on-year increase in gold production of over 10%. Shandong Hengbang Smelting Co., Ltd. accelerated the comprehensive recovery project of complex gold concentrate with multiple elements, and the smelted gold production (including imported raw gold production) saw a significant increase compared to the same period last year.
In the first half of 2024, although the gold price performed well, the gold production in China did not increase as expected, mainly due to the gradual depletion of easily extractable resources in old mines, the difficulty in constructing new mines, and the continuously increasing requirements of safety and environmental protection policies. Some gold mining enterprises reduced production, shut down for rectification, or could not continue production.
Large gold enterprises (groups) are the backbone of China's gold industry. In the first half of 2024, the domestic gold production from mines was 67.851 tons, accounting for 47.95% of the national total. Companies such as Zijin Mining (02899), Shandong Gold (01787), and Chifeng Gold (600988.SH) have achieved significant results with their "going global" strategy. In the first half of 2024, the overseas mines of China's gold industry achieved a gold production of 34.399 tons, a year-on-year increase of 19.00%.
In the first half of 2024, the national gold consumption was 523.753 tons, a decrease of 5.61% compared to the same period in 2023. Specifically: gold jewelry was 270.021 tons, a year-on-year decrease of 26.68%; gold bars and coins were 213.635 tons, a year-on-year increase of 46.02%; industrial and other gold uses were 40.097 tons, a year-on-year decrease of 0.53%. In the first half of 2024, with the continuous rise in gold prices to historic highs, the sales of gold jewelry and gold bars/coins showed a polarized trend: the consumption of high-premium gold jewelry significantly decreased, while the consumption of relatively low-premium gold bars and coins increased significantly. The high and fluctuating gold prices increased the operational risks for gold processing and sales enterprises, leading to reduced purchases by wholesale and retail enterprises, and a significant decrease in the processing volume of jewelry processing enterprises.
In the first half of 2024, the Shanghai Gold Exchange saw a total trading volume of 29.8 thousand tons (14.9 thousand tons on one side), a year-on-year increase of 39.77%, with a total trading value of 15.49 trillion yuan (7.74 trillion yuan on one side), a year-on-year increase of 68.48%. The Shanghai Futures Exchange saw a total trading volume of 80.1 thousand tons (40.1 thousand tons on one side), a year-on-year increase of 34.74%, with a total trading value of 35.67 trillion yuan (17.84 trillion yuan on one side), a year-on-year increase of 58.58% In the first half of 2024, especially after entering March, the price of gold rose rapidly, and trading volume increased significantly. In response, domestic gold spot exchanges temporarily implemented market risk control measures. The Shanghai Gold Exchange issued a notice to increase the margin ratio and price fluctuation limits for gold deferred contracts, while the Shanghai Futures Exchange imposed trading limits on gold futures contracts and raised the fees for the main gold futures contracts. In the first half of 2024, boosted by the rise in gold prices, the domestic gold ETF holdings increased to 92.44 tons, up by 30.97 tons from the end of 2023, representing a growth of 50.38%, reaching the highest level since the listing of domestic gold ETFs in July 2013.
At the Shanghai Lujiazui Forum in June this year, the China Banking and Insurance Regulatory Commission stated its intention to actively explore pilot investments by insurance funds in Shanghai Gold Exchange gold contracts and related products, sending a positive signal for insurance funds to enter the gold investment market.
In the first half of 2024, geopolitical conflicts persisted, global economic recovery remained weak, inflation was high, unilateralism and protectionism intensified, and the safe-haven and value-preserving functions of gold were once again emphasized. The price of gold surged, continuously hitting new historical highs. By the end of June, the London spot gold fixing price was $2330.90 per ounce, up by 12.34% from $2074.90 per ounce at the beginning of the year. The average price for the first half of the year was $2202.91 per ounce, up by 14.05% from $1931.54 per ounce in the same period last year. The closing price of Au9999 gold at the Shanghai Gold Exchange at the end of June was 549.88 yuan/gram, up by 14.37% from the opening price of 480.80 yuan/gram at the beginning of the year. The weighted average price for the first half of the year was 514.12 yuan/gram, up by 18.98% from 432.09 yuan/gram in the same period last year.
In the first half of 2024, central banks around the world continued to increase their gold holdings, steadily raising the share of gold in foreign exchange reserves. China accumulated an additional 28.93 tons of gold, bringing the country's gold reserves to 2264.33 tons as of the end of June
