China increased the import of gold through Hong Kong last month, according to the latest data from the Hong Kong Census and Statistics Department sent to Reuters. The gross gold import in the month of October came in at 147,92 tonnes, of which 131,19 tons remained as net import. China has imported more than 100 tonnes of gold each month in the past six months, way more than in previous years. And while gross imports were lower than the 223,5 tonne record high in March, net imports in October were on par at about 130 tonnes.
In September gross imports from Hong Kong into China were at 116,3 tonnes and net imports amounted to 109,4 tonnes. The following graph shows that gross imports in the first ten months of 2013 have doubled compared to the same period in 2012. We are still accumulating net import data from last year. When we have those data, we will start publishing the net imports into China. Those figures are closer to the real gold demand from China.
Gross Chinese gold imports in 2013 and 2012
China imports a record amount of gold this year
In the first ten months of 2013 China has imported a net amount of 957,22 tonnes of gold from Hong Kong. With two months to go it is quite obvious that China will surpass the 1.000 tonne estimate by the World Gold Council. Gross imports for this year stand at 1.262,82 tonnes, double the amount in the same period of last year. Whether net imports increased by the same amount remains to be seen, but the increase in 2013 is by all means very significant.
The Chinese don’t seem to worry about the biggest decline in goldprice in years. Year to date the price of gold has dropped about 26 to 28 percent in euro’s, dollars and Chinese yuan. The Chinese government is promoting private ownership of gold and we expect the Chinese central bank to be adding gold to their reserves as well.
Gold imports from Shanghai
China does not publish data on the total imports of gold, but because most of the precious metal is imported through Hong Kong these data is used as a proxy for the Chinese gold demand. Last week Reuters published an article on direct Chinese gold imports through Shanghai, a growing import channel which was overlooked for a long time. According to research by Reuters, China imported about 133 tonnes of gold via this alternative route. The gold imports through Shanghai are expected to increase even further, because of strong demand for physical gold among the Chinese consumers. According to Philip Klapwijk, analyst at consultancy firm Precious Metals Insight, the increasing gold imports through Shanghai are the result of efforts by the government to promote gold ownership among the Chinese population.
Gross and net imports of gold into China in 2013