| Shanghai Gold Exchange Withdrawals Point to Strong Chinese Demand | |
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Current Macro Factors Driving Gold and Silver Prices (Continued from Prior Part) Shanghai Gold Exchange
China is the number one gold consumer. That’s why it’s vital for gold investors to track the demand in China. In this part of the series, we’ll learn about how withdrawals from the Shanghai Gold Exchange are progressing. This indicator points toward the underlying gold demand in the country.
Chinese (FXI) gold withdrawals from the SGE (Shanghai Gold Exchange) are the best indicator available of China’s demand for physical gold. All of the mined and imported gold in China can only sell through the SGE. By tracking the data, investors can get a good idea of the short-term direction of Chinese demand.
Withdrawals are strong
In the week ended June 19, a total of 54.2 tons of gold was withdrawn from the SGE. Year-to-date, withdrawals are a hefty 1,115.8 tons—up a whopping 21.3% from the same period last year. Now that the peak festive season is over, Chinese gold withdrawals can’t be compared with the levels reached in January or February. But for the time of year, they’re very strong.
Although this shows continued strong demand for physical gold in China, investors need to consider that the gold withdrawals could come from any of three sources:
- imports
- recycled gold
- domestic production
Historically, China’s and India’s physical-gold buying have boosted gold prices. Strong withdrawals from the SGE should support gold prices (GLD). This also helps gold stocks including Agnico Eagle Mines (AEM), AngloGold Ashanti (AU), and Royal Gold (RGLD). It also affects the Market Vectors Gold Miners ETF (GDX). Agnico Eagle Mines and AngloGold Ashanti form 9.8% of GDX’s holdings.
Precious metals–backed ETFs are large holders of physical bullion. So it’s important to track their buying and selling behavior. In the next part of this series, we’ll discuss precious metals ETFs and their holdings.
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Royal Gold Inc.
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PRODUCER |
CODE : RGLD |
ISIN : US7802871084 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Royal Gold is based in United states of america. Royal Gold produces gold, copper, lead, silver and zinc in Argentina, in Bolivia, in Burkina Faso, in Canada, in Chile, in Guinea, in Mexico, in Nicaragua and in USA, develops copper, gold, lead, silver and zinc in Australia, in Burkina Faso, in Canada and in Chile, and holds various exploration projects in Argentina, in Bulgaria, in Canada and in Finland. Its main assets in production are BALD MOUNTAIN in USA, LIMON, LEEVILLE MINING COMPLEX and GOLDSTRIKE OPEN PIT in Nicaragua, DON MARIO (CERRO PELADO) and ROBINSON (NEVADA) in Bolivia, EL CHANATE, PEÑASQUITO, WHARF, MARIGOLD, DOLORES MINE, MULATOS MINE -ESTRELLA and GOLDSTRIKE UNDERGROUND in Mexico, SIGUIRI in Guinea, TAPARKO in Burkina Faso, MARTHA MINE in Argentina, ANDACOLLO HYPOGENE, TOQUI and ANDACOLLO in Chile and WILLIAMS, TWIN CREEKS, PIPELINE MINING COMPLEX and TROY in Canada, its main assets in development are GOLD HILL and PASCUA LAMA in Chile, HOLT MINE & MILL and PINE COVE (MINGS BIGHT) in Canada, BALCOOMA in Australia and BOUROUM in Burkina Faso and its main exploration properties are CANADIAN MALARTIC (QUEBEC), GOLDSTRIPE WILLA, MANHATTAN (WHITE CAPS) and CAMP BIRD MINE in Canada. Royal Gold is listed in Canada, in Germany and in United States of America. Its market capitalisation is US$ 6.9 billions as of today (€ 6.0 billions). Its stock quote reached its lowest recent point on February 28, 1992 at US$ 0.03, and its highest recent level on October 12, 2023 at US$ 105.50. Royal Gold has 65 455 293 shares outstanding. |