Chinese Gold Imports Through August Surpass Total ECB Holdings, Imports From Australia Surge 900%

Tyler Durden's picture

First it was more than the UK. Then more than Portugal. Then a month ago we said that as of September, "it is now safe to say that in 2012 alone China has imported more gold than the ECB's entire official 502.1 tons of holdings." Sure enough, according to the latest release from the Hong Kong Census and Statistics Department, through the end of August, China had imported a whopping gross 512 tons of gold, 10 tons more than the latest official ECB gold holdings. We can now safely say that as of today, China will have imported more gold than the 11th largest official holder of gold, India, with 558 tons.

Yet despite importing more gold than the sovereign holdings of virtually all official entities, save for ten, importing more gold in July than in any month in 2012 except for April, importing more gold in 8 months in 2012 than all of 2011, and importing four times as much between January and July than as much as in the same period last year, here is MarketWatch with its brilliant conclusion that the 'plunge' in gold imports in August can only be indicative of the end of the Chinese gold market, and the second coming of infinitely dilutable fiat.

“China’s near-term appetite for gold appears to be waning as bullion imports from Hong Kong slow,” HSBC analysts said in a note following the data release last week.


Anecdotal evidence also pointed to the cooling trend, with one Hong Kong bullion dealer saying the word from mainland clients was that gold inventories are saturated.


“What we are hearing from our customers is that they were buying gold rapidly over the last couple of years, but they would now see some of their stocks sold off before they rebuild some of their inventories,” Scotia Mocatta managing director Sunil Kashyap said in Hong Kong.

There is spin, and there is of course, reality. We urge readers to identify where on the chart below is the evidence of Chinese disillusionment with gold:

Furthermore, with the status quo cartel in desperate need of China stepping up its monetary easing, and jumping right into the race to debase, which is absolutely critical to halt the plunge in tech company revenues and earnings, any interim slowdown in purchases is merely a springboard for even more purchase in the future once inflation does come back to China with a bang.

Incidentally, one thing that MarketWatch completely forgot about is that in Q4 Chinese gold purchasing, all monetary else equal, is set to spike in Q4. From the South China Seas:

Fung expects gold imports on the mainland to stay soft this month as prices have continued to remain high.


"However, gold consumption is likely to climb again in the fourth quarter, a traditionally peak season when Chinese people buy gold jewellery for weddings and presents," he added.

All rhetoric aside, one unspinnable aftereffect of China's relentless appetite for gold comes from a different place, namely Australia, where gold just surpassed coal as the second most valuable export to China. From Bullionstreet:

Australia's gold sales to China hit $4.1 billion in the first eight months of this year as it surged by a whopping 900 percent.


According to Australian Bureau of Statistics, the yellow metal became the second most valuable physical export to China, surpassing coal and only behind iron ore.


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


Perth Mint supplied most of the gold to China through a variety of banks.


Analysts said 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.


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

In other words, take the chart above, showing only Chinese imports through HK, and add tens if not hundreds more tons of gold entering the country from other underreported export channels such as Australia. One thing is certain: China no longer has any interest in buying additional US Treasurys. What it does have an interest in is up to readers to decide.

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kliguy38's picture

"monkeyhammering".....I like it bro......hehehhehe......GOLD BIATCHEZ!

Motorhead's picture


Acet's picture

In no little part thanks to bullion leases from Western Central Banks.

The ultimate ridicule is that Western Central Banks are in effect subsidizing China's movement away from the US Dollar and, in all likellyhood, the rise of the Yuan as the World's new Reserve Currency.

Observe the collapse of the Western civilization and the money lenders right in front selling us to the chinks.

ArrestBobRubin's picture

Fiat money is the "financial system" belonging to whom? The bullshit you rightly call out is the power base and means of enrichment of La Kosher Nostra, at our expense.

Pigs gotta get slaughtered.

It's either gonna be them, or it's gonna be us.

Haole's picture

It is truly in broad daylight with no lube now, for those willing to see and acknowledge it but at least we get to buy at artificially suppressed "prices" until the charade eventually comes apart like a soup sandwich.  What happens then is of more concern to me than current manipulation.

Tango in the Blight's picture

If they can turn paper into gold they will prove themselves to be the true alchemists.

JustObserving's picture

China is also the largest gold producer in the world producing 355 tons in 2011.  Through August 2012, Chinese production was reported at 249.7 tons, a year-on-year increase of over 10 percent.

The imports are in addition to the domestic gold production.  China is moving from the infinite supply of Bernanke dollars to real money. Can anyone fault them, except the Fed?

Urban Redneck's picture

The "end of the Chinese gold market" won't come before the Chinese miners start hawking their 900,000oz/month production at the LBMA, or when hell freezes over, whichever comes first... (at the current rate of over 1000 tons per year they would double their "reported" holdings by Christmas)

DosZap's picture

China is also the largest gold producer in the world producing 355 tons in 2011.  Through August 2012, Chinese production was reported at 249.7 tons, a year-on-year increase of over 10 percent.


If you believe anything reported by the Reds,your sadly mistaken.

lasvegaspersona's picture


you trust those numbers? I do not.

JustObserving's picture

Here is the source of the numbers.  It is not a Chinese source. There seems to be no reason to doubt the veracity of the numbers.

Eally Ucked's picture

Yeah, they're so stupid and they show it every day.

EscapeKey's picture

I wonder what that whore, "american patriot" has to say about that.

tawse57's picture

Just because the Chinese appear to buying loads of gold does not make them correct about its future value. They could end up being the biggest gold holders in the world and the value could be a fraction of today's price.

I know the bull golds on here won't be able to contemplate that but a couple of brothers bought nearly all the silver once and the price still crashed.

Conman's picture

"Just because the Chinese appear to buying loads of gold does not make them correct about its future value."


Doesnt make them wrong either. Most likely an inflation hedge. Whats worse - hyperinflation like zimbabwe where it is 100000000% or losing 50% in a worst cast scenario for gold?

tawse57's picture

Or no hyperinflation and still losing 50%?

EscapeKey's picture

You know, i am pretty sure my krugerrands can be exchanged for other goods in 100 years time. But you should feel free to hold your wealth in precious $10 notes if you prefer.

Debeachesand Jerseyshores's picture

Gold and silver have been mediums of exchange for over 5000 yrs and will continue to be mediums of exchange at least another 100 yrs barring Nuclear War or the Mayans predictions come true.

scatterbrains's picture

lets not forget copper (bronze) being a form of money for thousands of years as well.

scatterbrains's picture

not to mention it being a war metal.. ammo casings etc.  I bet copper goes to 7 before gold goes to 3500 (side bet to my little down arrow friend)

Shelby Moore III's picture

Oh that is brilliant. We can go back to 332 B.C. when iron was money too.

So can you handle 25,000 lbs of copper to store $100,000 in your house?

Well at least you admitted you're scatter brain.


scatterbrains's picture

Let's just see which metal doubles in price first shall we ? I'm not expecting peeps to think copper is money... at least until it reaches $10 or $15 a pound.  I remember when silver was $65 a pound..  would have been a real pain in the ass trying to find a spot to stick 1500+ pounds of silver in the house. (using your $100k example)

Shelby Moore III's picture

When silver was $65 per lb ($4.50 per oz), copper was $1.50, so reduce that to 580 lbs, quite a bit less than 25,000 lbs (with copper at $4 recently). And silver was heavily suppressed as the monetary metal it had been historically, with a gold-to-silver ratio at 100+ (6 times higher than the historical mean).

Copper is 714 times more abundant than silver:'s_crust

So it can not logically rise sustainably to such a large fraction of silver's current $32 price.

The predominant use of copper is industrial, which means the stocks to flows ratios are very low (not very large stockpiles relative to annum consumption).

Silver and gold have huge stockpiles by investors, relative to the annual consumption. This is another reason they are stable stores-of-value.

You will probably have to learn this by burning your fingers first. Logic is hard to read.

P.S. at 1/10 silver's price (yet 1/714 as rare), this adds evidence to my argument that base metals are way overpriced:,%20Rise%20of%20Knowledge.html#WherestheBeef?

lasvegaspersona's picture

D J 

do you really think gold's best use is as a medium of exchange? I do not. We have fiat for that. Fiat can be wired anywhere on the planet. It is great as a MoE. The problem arises when those idiots that make it try to sell it as a store of value! It SUCKS as a store of value!!

This is where gold shines!!! Gold can sit in a safe for a generation and when it sees daylight again it is still beautiful. This is the coming change in the world's monetary system. Fiat for MoE. Gold for SoV. Check out this new Euro thingy. I hear a couple of (real) Nobel lauriates put 20 years into designing it. Then think about that design. It was made for the coming changes. You may not like it but it would do you well to understand the implications of its design.

Shelby Moore III's picture

Your krugs will decline massively in value w.r.t. to a software engineer's income potential.

They will continue to buy a fine man's suit, i.e. maintain or increase their purchasing power w.r.t. to hard and manufactured goods.,%20Rise%20of%20Knowledge.html

EscapeKey's picture

What a happy coincidence indeed that is then, as tbat just happens to be my exact line of work.

Enjoy your rare paper fiat notes.

Shelby Moore III's picture

I hope you didn't think I was advocating saving in rare fiat notes. If I have no knowledge investment for my fiat capital, I would hold it gold and silver at this juncture of history.

The potential income of software engineers depends on their ingenuity and effort. I am not talking about their mean salary. Fresh graduates from top universities such as Stanford can get up to $200,000 + stock options offers from startups or Google. For the most talented who can produce, especially creating their own startups, this will rise into the $millions over this decade.

Gold's rise will peak or slow at some point during this decade. The software engineers will continue to rises in income potential after that.

mkkby's picture

I read your rambling article, which you ludicrously think will be published somewhere to make you famous.  It is so badly in need of editing, I don't even know where to begin.

Your software engineer is merely a laborer.  He holds no stored value in what you call knowlege.  Companies that actually employ enough capital to hire SW engineers are working hard to massively devalue his labor.  That is what globalism is about, or didn't you understand that?

My main comment is your writing stinks of socialist bias.  You don't go from subistence farming to world power in one generation.  China did not sell their people into slavery for the price of a bus ticket.  Those people are fighting for those jobs, and they are not going back to their subisitence farming once they get a taste of it.  What else do you do with a billion illiterate, largely starving people?  Have them write software, lol?  Same for the one child policy.  What do you do with a billion people who multiply faster than their food supply?  Ask them politely to try abstinance, lol?

Yes, China's elite did it for power.  So what?  In your socialist view, I guess the illiterate workers should get all the benefit, even though they bring very little to the table.

Bay of Pigs's picture

Say what? The Hunts were brought down by ridiculous margin calls at the corrupt and fraud ridden COMEX and FED itself, not because they owned a bunch of physical silver.


JustObserving's picture

They did the same last year when silver was near $50.  From Zero Hedge:

"Remember when earlier we said the CME had hiked silver margins for the 4th time in 8 days? We lied. In fact,what the CME did was to hike margins for the 4th (effective May 5) AND 5th times (effective May 9). That's right, dear reader, in one release, the CME has performed two concurrent margin hikes, which means today's action is the 5th margin hike in 8 days, a previously unheard of event"

LawsofPhysics's picture

Make margins on everything 100%, go ahead motherfuckers, I double dog dare you.  who will the sheeple blame for the rising costs then?

DoChenRollingBearing's picture

+ 1

Excellent idea!  Make the margins 100% (no loands for PMs).

Then we get to see what is real.  I'll take the physical, please!

Alpo for Granny's picture

Fuck that LOP. I triple dog dare those bitchez. Go ahead CME..stick your tongue to the frozen pole you fucks.

ArrestBobRubin's picture

Didn't you get the twitter about never going Full Retard?

Bay of Pigs's picture

Good to see you Bob. Lots of former Turdites back here at the Hedge after the Mod Jane purge. LOL.

markar's picture

Why do you think they are buying so much? Here's the short answer: They want to back their currency with it and become the world's reserve currency. What price in dollars do you think that would equate to? $5000/$10,000/$20000 per oz.?

Marigold's picture

The Delirium of Millards

The majority of statesmen and financiers think in terms of paper,
They sit in their offices and look at papers which are lying in front of them and on those papers are written figures which represent papers... They write down noughts , and nine noughts mean a Millard. A Millard comes easily and trippingly to the tongue , but no one can imagine a millard.
What is a Millard ? Does a wood contain a Millard leaves ? Are there a millard blades of grass in a meadow ? Who knows ? If the Tiergarten were to be cleared and wheat sown upon it's surface, how many stalks would grow ? Two milliards !

What would Frau Eisenmenger say !

WryObserver's picture

And you know for a fact that they aren't hedging their position? Can we at least agree that right now at the present time the trend has been their friend?

ultimate warrior's picture

*Ben Bernanke scratches his head*

Florida Joe's picture

"tawse said . . . 

Just because the Chinese appear to buying loads of gold does not make them correct about its future value. They could end up being the biggest gold holders in the world and the value could be a fraction of today's price.

I know the bull golds on here won't be able to contemplate that but a couple of brothers bought nearly all the silver once and the price still crashed."


State the rest of the facts, such as silver went from $2 to $50 oz, hugely on margin by the Hunt Bros., and the exchange changed the rules, the Bros had a mrgin call that could not be met, and down it went.

Now, what similar facts are present rto day  . . .  wait for it . . .  none. 

Your analogy fails. 


DosZap's picture

I know the bull golds on here won't be able to contemplate that but a couple of brothers bought nearly all the silver once and the price still crashed."


 And why was that?, because the Goobs stepped on their d*$#%.

Had the Hunts snagged all the Phyzz avail,then the outcome would have been the same..................the .goobs would never have allowed it.

Acet's picture

China is buying it in cash, taking physical delivery and oh, by the way, they're a sovereign.

More to the point, proportionally to the size of their economy their gold reserve is still small.

There doesn't seem to be any clear mechanism that could be used to turn China from a buyer to a seller.

That said, it's not as much Gold that is going up, it's most currencies going down (due to money printing and loss of confidence in several nation's willingness and ability to maintain fair markets and to pay their own debts).

ziggy59's picture

Gold... Its whats for dinner..

And lunch..

And breakfast

AssFire's picture

Gold not determine who right, gold determine who left...


ancient Chinese proverb

Shelby Moore III's picture

And their "wisdom" has led them to be such an incredibly prosperous nation over the past century and more. \sarc

(ravaged by war, opium addiction, empires, etc)

ThirdWorldDude's picture

Dumb bitch! 

Old nations don't consider prosperity to have the same definition as a modern Yankee does; they're wise enough to know that in this race against time, it is the nation that's remained whole and preserved it's culture that still has a chance of winning. Now, let me tell you a secret: the Chinese have been around for the last 4100 years.


"We will bury you!"   -   Nikita Khrushchev

Shelby Moore III's picture

I am male.

Suffering became prosperity in your definition of "winning". Now thats duller than a rusty nail.

I have shown that the people of China are suffering:


P.S. in case your little brain thinks I missed your point, sustaining a culture of suffering is not prosperity, no matter what intrinsic value you want to assign to culture and cohesion. Even if your point was resisting the control of the new world order, or jews, or bankers, or what ever, suffering and misallocation of capital plays right into such unwanted outcomes.

youngman's picture

I think its pretty soon...not ten years that the Chinese announce....I think with the Russians and Indians too.....that a new world currency is here...backed by gold...and all trade bewteen them willl be in this new currency...and pooof...the little countries will jump on it....and the USA, EU, Japan, and Britain will be loeft all alone...I bet China has a lot more gold than we think..

Winston Churchill's picture

Is that ten year guesstimate based on the alledged US holdings

of gold ?

Don't think it exists and a lot of experts agree, that the production shortfall to

demand over the last decade, was covered from somewhere.The ammount supplied could

only really come from the US's gold 'reserves'.

Think the bluff on reserves is about to get called.