China imported 1,506 tonnes of gold in 2018

China imported 1,506 tonnes of gold last year, the LBMA writes in its latest newsletter. Most of the gold came from Switzerland, but the country also imported a lot of precious metals from Australia, South Africa, Canada and the United States. Hong Kong is only used as a transit port to bring gold from abroad to the Chinese mainland. The total volume was more than 18% higher than a year earlier, when China imported 1,270 tonnes of gold.

China is the largest market for the precious metal, but for a long time there was uncertainty about its exact size. For a few years now, the central bank has been reporting its gold purchases on a monthly basis, and it was only last year that the exact import data was released. Until then, gold imports via Hong Kong and export data from other countries were used as a derivative for gold demand in China. These figures became less and less relevant as China started importing more gold from other countries.

New dates

Since last year, China has also been reporting its imports of precious metals in accordance with international standards. The figures for 2017 were also released retroactively. These new figures paint a more accurate picture of the Chinese gold market. Compared to previous estimates, China appears to be importing much more gold from Australia and South Africa. We also see that the country imports much more precious metals from the United States and Canada, countries with a large domestic gold mining sector.

China has been the world's largest gold producer for a few years now, but its total production is still not enough to meet total domestic demand. For the past five years, China has therefore obtained hundreds of tons of gold from abroad every year. The new figures do not paint a radically different picture of this trend, but they do show that China is sourcing precious metals globally to serve the domestic market.

Chinese buy gold as an alternative form of savings. The precious metal has no counterparty risk and is able to retain its value better than currencies in the long term. Due to the growth of the Chinese economy, the purchasing power of the middle class increases, giving the population more money to buy gold.

China mainly imports precious metals from Switzerland

New Figures Show Chinese Are Buying Even More Gold