China boosts gold imports from Hong Kong

Some 129 tonnes bought in July, with demand boosted by high local prices

PUBLISHED : Friday, 06 September, 2013, 12:00am
UPDATED : Friday, 06 September, 2013, 4:00am

Gold shipments to the mainland from Hong Kong increased in July as importers took advantage of local prices that were an average 2.1 per cent higher than global markets and as mainland investors bought jewellery and coins.

Net imports, after deducting flows from the mainland into Hong Kong, were 113 tonnes, from 101 tonnes a month earlier, according to calculations by Bloomberg.

Mainland buyers purchased 129 tonnes in July, including scrap, compared with 113 tonnes in June, data from the Hong Kong government showed yesterday.

Gold prices, which advanced 18 per cent from a 34-month low in June, are attracting buyers on the mainland, which is on track to overtake India as the world's top bullion consumer this year.

Premiums paid by jewellers above spot prices on the Shanghai Gold Exchange to take physical delivery of the metal were an average US$27 an ounce during July, according to calculations.

"China's seeing robust gold sales this year," said Duan Shihua, a partner at commodities fund Shanghai Leading Investment Management. "The high prices in China's domestic market in July encouraged importers."

Bullion of 99.99 per cent purity on the Shanghai Gold Exchange in July made its first monthly gain since January, advancing by 9.2 per cent. It extended gains by 4.4 per cent last month.

Mainland purchases in July were 70 per cent higher than the 75.8 tonnes in the same month last year, according to data from the Hong Kong Census and Statistics Department. The mainland does not publish such data.

Mainland exports of gold to Hong Kong were 16 tonnes in July, a separate statement from the department shows, compared with 11.7 tonnes in June and 30 tonnes in July last year.