You are here

China grabs Australian gold

Section: Daily Dispatches

Sales Soar 900% as China Makes Grab for Aussie Gold

By Michael Salisbury and Sarah-Jane Tasker
The Australian, Sydney
Thursday, October 18, 2012

Gold has soared past coal as Australia's second most valuable physical export to China, with sales up a whopping 900 per cent for the first eight months of the year, bringing in $4.1 billion.

Chinese buyers are hoarding the precious metal amid a slowing economy, property-buying restrictions, and uncertain financial markets as its central bank increases its holdings.

The unprecedented jump in gold sales, along with continued acceleration of export revenues for other commodities led by coal -- up 80 per cent to $4 billion -- caused total exports to China to rise by 10.7 per cent for the year to August, according to Australian Bureau of Statistics figures.

... Dispatch continues below ...


Prophecy Platinum Intercepts Best Pt+Pd+Au Grades Yet
at Wellgreen Project in Yukon Territory: 5.36 g/t

Company Press Release
Tuesday, September 11, 2012

VANCOUVER, British Columbia -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) announces more results of its 2012 drill program on the company's fully-owned Wellgreen platinum group metals, nickel, and copper project in southwestern Yukon Territory, Canada. Four surface holes and four underground holes all intercepted significant mineralized widths, ranging from 28.5 meters (WS12-201) and up to 459.5 metres (WS12-193). Highlights include WU12-540, which returned 8.9 metres of 5.36 grams per tonne platinum, palladium, and gold; 1.73 percent copper; and 1.01 percent nickel within 304.5 meters of 0.66 g/t platinum-palladium-gold, 0.20 percent copper, and 0.27 percent nickel.

The surface drill program started in June and has completed 16 holes (assays pending for 12 holes) with two rigs now on site. The surface program continues to progress at a steady pace.

Prophecy Chairman John Lee commented: “Wellgreen is a very large nickel, copper, and platinum group metals project with near-surface high-grade zones. High-grade intercepts will be incorporated into resource modeling and mine planning in the pre-feasibility study. We expect further positive drill results from Wellgreen shortly.”

Wellgreen features a low 2.59-to-1 strip ratio, is situated at an altitude of 1,300 meters, and is only 15 kilometers from the two-lane paved Alaska Highway. Those factors significantly minimize the project's indirect costs.

For the complete company statement with full tabulation of the drilling results, please visit:

Shipments of Australia's biggest export, iron ore, were up 20 per cent for the same period but the total value of $26.9 billion was down 5 per cent compared to last year because of the mid-year price slump.

China's foreign currency reserves of gold are low and its move to build them up will provide an important base demand for gold, analysts said.

Nigel Moffat, manager of treasury operations at the Perth Mint, said large quantities of the Mint's gold had been supplied to China through a variety of banks.

"During the last year demand has increased significantly, which has meant that from time to time demand well outstripped supply," he said. "In the last four to six weeks, though, demand has fallen off significantly, as it has everywhere."

China's gold demand was beginning to outstrip even India's.

The trade in gold bars and coins for savings and investment has only ramped up in the past three or four years in China.

Jewellery investments have also soared in recent years as ornamental gold has once more become a fashionable investment.

At Caibai, a busy jewellery and gold market in Beijing's western suburbs, customers were buying gold yesterday afternoon.

Local accountant Lu Qing, 38, bought a 20kg gold bar, a necklace, and a pair of earrings. "Buying gold is a stable investment," she said. "You can expect to make a profit out of it, but if nothing dramatic happens you won't lose much.

"If you put money in a bank your savings might be eroded with inflation or low interest rates -- bank fees are getting higher too. We spend an average of 5 per cent of our annual income on gold, which we keep at home."

The managing director of Australian goldminer Northern Star Resources, Bill Beament, said the Chinese were becoming very active in the corporate gold market.

"They are very active (in Australia) ... and we aren't talking small gold producers, it is the big Chinese gold producers that are visiting," he told The Australian.

The attractiveness of gold as a safe haven has increased as governments around the world continue to print money, diminishing the value of the dollar.

"With gold, you dig it up and it's not something that diminishes in value," Mr Beament said.

China, the world's largest gold producer, has already increased its interest in Australian goldminers this year and taken a majority stake in listed-company Focus Minerals.

Jake Klein, executive chairman of gold company Evolution Mining, said it was encouraging to hear more gold was going to China.

"China is going to be an increasingly important destination for gold -- there is no doubt," he said.

* * *

Join GATA here:

New Orleans Investment Conference
Wednesday-Saturday, October 24-27, 2012
Hilton New Orleans Riverside Hotel
New Orleans, Louisiana

* * *

Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:

Or by purchasing a colorful GATA T-shirt:

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

To contribute to GATA, please visit:


GoldMoney adds Toronto vaulting option

In addition to its precious metals storage facilities in Hong Kong, Switzerland, and the United Kingdom, GoldMoney customers now can store their gold and silver in a high-security vault operated by Brink's in Toronto, Ontario, Canada.

GoldMoney also has recently partnered with Rhenus Freight Logistics to offer another gold storage option in Switzerland. The Rhenus vault is in the secured zone of Zurich Airport and offers customers superb security as well as the ability to inspect their gold.

Storage at the new vaults in Canada and Switzerland is available at GoldMoney's lowest fees. Customers can select their storage location when placing their buy order.

GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults.

It's easy to open an account, add funds, and liquidate your investment. For more information, visit: