BREAKING: China - World's Largest Gold Producer Mine Supply Plummets 10%

SRSrocco's picture

SRSrocco

By the SRSrocco Report,

The world's top gold producer saw its mine supply plummet by 10% in the first half of 2017.  According to the GFMS World Gold Survey newest update, China's gold production in 1H 2017 fell the most in over a decade.  The fall in Chinese gold production is quite significant as the country will have to increase its imports to make up the shortfall in its mine supply

The data in the GFMS 2017 Q3 Gold Survey Update & Outlook reported that Chinese gold mine supply declined 23 metric tons to 207 metric tons in the 1H 2017 versus the 230 metric tons during the same period last year:

The report stated the reason for the decline in Chinese gold production was due to the government's increased efforts to curb pollution as well as heightened awareness of environmental protection.  Furthermore, GFMS analysts forecast that Chinese gold production will continue to deteriorate for the remainder of the year as production is scaled down.

This is undoubtedly bad news for a country that is not only the world's largest gold producer but also because China consumes all of its domestic mine supply.  To get an idea just how far China is ahead of the rest of the pack, take a look at the following chart:

Last year, Chinese gold mine supply of 454 metric tons (mt), was 56% higher than second-ranked Austraila at 291 mt.  These eight top gold mining countries produced 56% of the total world's supply of 3,222 mt in 2016.  Lastly, you will notice that South Africa came in last place at 150 mt.  However, South Africa was the leading gold supplier in the world in 1970, when it produced a staggering 1,000 mt:

Also, isn't it ironic that the U.S. dropped the Gold-Dollar peg (Aug. 1971) the year after South African's gold production peaked?  Regardless, South African gold production is now down 85% from its peak in 1970.  For those individuals who don't believe in the theory of Peak Gold or Peak Oil, stick around a few years... and you will become a believer.

Now, there seems to be another interesting development as it pertains to Chinese gold production.  Unless China experiences a considerable rebound of its gold mine supply over the next several years, 2014 may turn out to be its ultimate production peak:

According to the figures reported in the GFMS 2017 World Gold Survey, China's gold production reached a peak of 478 mt in 2014 and is estimated to decline to 415 mt* this year (*415 mt is my estimate based on GFMS data).  If the forecast for 2017 is correct, China's gold production will have fallen 13% from its peak in 2014.  Moreover, if the world experiences a huge market correction and economic contraction in 2018, there's a high probability that Chinese gold production will have peaked in 2014.

Lastly, the peak and decline of global gold production will likely mark the time of the peak and fall of the global economy.  Now, I am not saying this occurs the very same year, but it will be a gauge to pinpointing the very time when reached the SENECA CLIFF.

Lastly, if you haven't checked out our new PRECIOUS METALS INVESTING section or our new LOWEST COST PRECIOUS METALS STORAGE page, I highly recommend you do.

Check back for new articles and updates at the SRSrocco Report.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
richo27's picture

I remember reading several years ago (no link) that China manages its gold mining operations much differently than any other privately run gold mines.  Most privately run gold mines draw from their high, medium and low grade ore bodies such that they maximize their mine life and total life-of-mine income.

 

 

China, according to this article, does not do this.  They have been strip mining their very best high-grade ore first, so as to maximize their gold production as fast as they can.  This would seem to make sense given their financial objectives, and the fact that the state owns the mines.  Thus, their starting to experience production declines, would also make sense.

Maestro Maestro's picture

And gold will promptly go down $10 'cause the idiots are colluding with Goldman Sachs and BIS to attack paper gold instead of buying real gold:

https://www.sprottmoney.com/blog/the-new-shanghai-gold-exchange-does-any...

The Chinese and the Russians are LYING about their gold buying and backing their currencies with gold. The Russians are buying DOLLARS with the proceeds of the oil they sell:

http://www.pravdareport.com/russia/economics/30-12-2014/129431-usa_russi...

Bam_Man's picture

The Chinese still bother to MINE for Gold?

LOL....

There is an infinite supply of Gold available on the COMEX at below production cost.

saldulilem's picture

Breaking: paper gold supply still infinite

HRClinton's picture

Paper gold...

Buy/Sell Price Spread: < Bullion 

Storage fees: Zero

Transportation costs: Zero

Insurance: Zero or price of Short

ROI: Price profits (luck or pump & dump), Shorting profits

1933 style Confiscation: Zero chance. Nothing to confiscate.

Buy/Sell timing: Online, almost real time.

 

If you're gonna hold gold, most of it should be paper gold or shares in an unallocated physical pool -- to realize the benefits outlined above.

Only a fraction should be converted into phyz bullion, for storage at home. Next to the pouch of Investment Grade diamonds, and stash of currency cash and passports. And next to the hardcopy of your crypto numbers, and thumb drive with offline cryptos.

It's called a LAYERED Portfolio, that plays smart Offense and shrewd Defense. Single-wall defenses (e.g. Phyz only) are for morons and hicks.

Dame Ednas Possum's picture

Gold content: zero. 

Muppet content in comment: 100%

 

steveo77's picture

Poll -- And Surprising Results Ongoing -- You Can Vote -- Outlaw Islam in the USA?
http://www.nukepro.net/2017/11/poll-and-surprising-results-ongoing-you.html

Consuelo's picture

 

 

Hardly 'surprising'...

If there ever was a honey pot for the Statists, I could not think of anything better...

Within less than 5 years (and perhaps a few convenient 'terrorist' incidents later), any form of practicing Christianity would follow suit.   

Perhaps the more appropriate poll question should be:

What is our purpose of occupying/regime-changing foreign lands where we have no obvious purpose? 

 

Dragon HAwk's picture

Go to any yard sale and watch all the people with monocles on rooting thru the old jewelry Boxes.

Number 9's picture

i suppose you want me to follow you on twitter, sign up for your newsletter and like you on fvkbook too..
advertisements camouflaged as news..
tell me this..just why in the hell does China have to increase its imports to make up the shortfall in its mine supply?
they going to starve without that fvkin 10% gold fix?
and if gold is going to soar to the moon, wtf you want to sell it to me for shitty fiats?
so....
fuck you. i aint buying

dlweld's picture

A useful comment from a no doubt useful person.

Consuelo's picture

 

 

"The report stated the reason for the decline in Chinese gold production was due to the government's increased efforts to curb pollution as well as heightened awareness of environmental protection."


Thumb & forefinger, wink-wink...

 

'Make a sound in the East, strike in the West...'

Buck Johnson's picture

I'm with you on that.

 

 

El Oregonian's picture

And then one day people will wonder why gold is in such short supply and why is it so expensive?

Please Lord, never let me be one of those people.

Muddy1's picture

So the supply in China's mines drops and shortly after the price of gold (and silver) on the worlds market drops about $5 and $0.15 respectively.  HOAX

TBT or not TBT's picture

The only way for our bloated government sector to continue the music is to enforce Permanently Low borrowing rates at which to roll existing and sell new debt.  Financial oppression uber alles until it breaks.   A symptom is pain in the middle and working class, translating to Trump and throw the bums out movements.   Once they take over the ship, it will be so flooded with debt and so compromised structurally that extraordinary and cataclysmic events are certain.   Only if things go perfectly, meaning huge productivity growth kicks in from new technology deployment, can this power taxes gambit power us out of this.