Chinese consumer demand for gold was up 32% on the year in 2013, to 1,065.8 tonnes, according to the latest World Gold Council report. The value demand for gold in China was $US51.6 billion.
There was a surge in both jewelry and total bar and coin investment demand. This was the first time China bought over a thousand tonnes of gold and saw it oust India from its position of top gold consumer.
This compares with 974.8 tonnes of consumer gold demand in India, which was up 13% from a year ago.
“Higher import duties, strict import quotas and restrictions on gold-related lending and coin sales led to a contraction of supply to the domestic market as the government attempted to reduce the current account deficit,” according to the report.
Here’s a look at the surge in gold jewelry demand in China that far surpasses India.:
And here’s an interesting anecdote that highlights growing demand from non-consumer gold demand in China:
“The tremendous growth in vaulting capacity in China is also indicative of OTC investment and stock flows. The expansion of gold storage capacity both on the mainland and in Greater China, which has included the building of sizable new vaults, is in part a reflection of growing demand for gold which is not captured within the consumer categories of demand, some of which will be related to the pipeline stock build-up mentioned above. These flows of bullion above and beyond retail demand are therefore captured within the OTC figure.”
2013 annual gold demand climbed to 3,756.1 tonnes.