HomeGoldChina to overtake SA as top gold producer

China to overtake SA as top gold producer

Exploration drilling
at the Guanzhuang
mine site in China
Shanghai, China — MININGREVIEW.COM — 29 May 2008 – China – the world’s second-largest gold producer last year – is expected to overtake South Africa as the world’s top gold producer in 2008.

Quoting China Gold Association vice secretary general Hou Huimin in an address here, Reuters reports that the country’s gold output will rise to 300 tonnes this year, compared to 270.5 tonnes in 2007 – which was just short of South Africa’s 272 tonnes.” South African production is expected to drop this year because of the nation-wide power crisis.

China’s demand for gold jumped 23 percent in 2007, making it the world’s second-largest consumer, as a booming economy spurred jewellery purchases. Bullion soared to a record US$1,032.70 an ounce on March 17, as a falling U.S. dollar and declining equities led investors to buy alternative assets.

Reuters reports that China’s total gold resource is between 15 000 and 20 000 tonnes, according to the Gold Association, and production of bullion in the first two months of the year was 38.2 tonnes.

China is already the world’s largest producer of the bullion, but the gap is expected to widen this year after a national power shortage cut electricity supplies to mining companies in South Africa.