China's gold output growth to slow in 2015 amid price falls
China, the world's largest gold producer, will see its output growth next year slow as falling prices deter miners from expanding capacity, according to the China Gold Association.
China, the world's largest gold producer, will see its output growth next year slow as falling prices deter miners from expanding capacity, according to the China Gold Association.
The mainland's gold output growth would slow from this year's pace of almost 10 per cent, said Zhang Yongtao, a vice-chairman at the association.
Gold output might exceed 470 tonnes this year, up from last year's record 428 tonnes, he said.
China ended South Africa's century-long run as the world's largest bullion producer in 2007 after companies including Zijin Mining Group and Shandong Gold Mining ramped up production. Prices dropped 28 per cent last year and banks including Goldman Sachs Group expect them to extend losses.
"The slump in gold last year and its failure to rally this year deterred a lot of planned investments to expand mining capacity," Zhang said. "The reason we are still seeing a robust growth in output this year is a delayed effect. Those investments that were made in the boom years took time to come into fruition."
Mined gold on the mainland will account for 450 tonnes of this year's forecast output, with the rest produced as a byproduct of non-ferrous smelting using imported ore concentrates, Zhang said.
Gold consumption in China shrank for a third quarter as falling prices failed to boost purchases of bars, coins and jewellery and as an anti-graft campaign hurt demand for luxury goods, the World Gold Council said in a report last month.
