China to replace S Africa as worlds top gold producer

Written by Commodities Bureau | Mumbai, Apr 9 | Updated: Apr 11 2008, 05:21am hrs
China's gold production in 2007 is expected to rise13% over the year to more than 270 tonne, overtaking South Africa (the long-standing largest gold producer in the world), whose gold production over the year is expected to fall under 270 tonne, down 32.5% from 1996 production levels.

China was expected to produce between 265 and 270 tonne of gold in 2007, said China Gold Association (CGA) official last month.

In addition to gold, China is also the world's largest producer of aluminium, zinc and lead.

At around 276 tonne output this year, if GFMS are correct in their assumptions, production is in line with forecast of 270 tonne made by CGA in mid-2007. Officially though, the status quo remains intact with China at second largest producer. Either way, it is bound to change in favour of China, says a CGA report.

About the positions of top gold producer for 2007, GFMS may announce the official figures in its release of the Gold Survey 2008, which will be revealed at a ceremony held in London on Wednesday.

Tight global supplies have not been satisfied through central bank selling, hence no affect on price, which has continued to surge post European disposals. The current upward trend in gold is often attributed to weak dollar/high inflation/economic concerns and high oil prices. Not enough credence is given to simple supply/demand ratio, says the GFMS report.