China’s Gold Imports Fall

Wednesday, 05 June 2013
Written by  Bullion Vault
Published in Gold Investing
China’s gold imports took quite a tumble from April to May of 2013, as data showed that imports of gold bullion fell by around 41%. The Census Bureau said Wednesday that April saw of gold imports through Hong Kong to China total 126 tonnes, with 46 tonnes then re-exported back through the island.

First-Strike

This isn’t too much of a surprise, especially when you consider how things have been going for gold in 2013. Still though, it is not great to see a fall by this much, especially when you consider that China is the world’s biggest holder of gold.

The net reading of 80 tonnes "is a surprise," Reuters quotes Ronald Leung, senior dealer at Hong Kong's Lee Cheong Gold Dealers. "Prices had fallen in April, but there was not much supply at that time.

"Maybe that's why imports have fallen. Premiums [above international benchmark prices] were sky high at that time."

Hong Kong is the major route for physical gold bullion into the world's #2 gold consumer nation. Local premiums over and above the global spot price – typically quoted for London delivery – surged to record highs in May, reaching $6 per ounce in what one official called "frenzied buying" by mainland Chinese households.

We will have to look toward next month’s data to see if anything goes imports shoot back up some. It would not be a surprise if imports were to drop some, but most agree that the next round of data will show some recovery numbers because gold is just too powerful in that nation to stay at those numbers for long.

As we know, China spent over a year and a half or so building themselves up with gold reserves and really putting themselves into a position to be a huge player in the precious metals game. Nothing has really changed, they are just experiencing some lower import number than usual due to all that has happened this year in the gold sector.

Demand for the yellow metal has surged since this round of data came out, so we should see better import numbers when the next pieces of data hit us sometime in around a month or so.

Original Article: Bullion Vault

Read 1486 times