Shanghai Gold Exchange Withdrawals Week Ended July 31, 2015

Shanghai Gold Exchange volume for the week ended July 31, 2015.

The Shanghai Gold Exchange withdrawals were 53.34 tonnes of gold during the week ended July 31, 2015.

Total gold withdrawals on the Shanghai Gold Exchange year to date are 1,463.90 tonnes.

Withdrawals on the Shanghai Gold Exchange are running 34% higher than last year.

Gold withdrawals on the Shanghai Gold Exchange the past two weeks were larger than the amount of gold delivered on COMEX during 2014 and greater than the amount of gold Germany has repatriated from the New York Fed since 2013.

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China’s Insatiable Demand for Gold

The Shanghai Gold Exchange (SGE) delivered 53.34 tons of gold during the week ended July 31, 2015. The prior week the SGE delivered 73.29 tonnes of gold – the third largest amount in any week.

The two week total is over 126 tonnes of gold delivered and the year to date total is over 1,463 tons, for an annualized run rate of approximately 2,500 tonnes.

Shanghai Gold Exchange Withdrawals During the Two Week Period Ended 7/31/2015 vs. Comex 2014 Deliveries

chart showing shanghai gold exchange withdrawals during a two week period vs Comex annual gold deliveries

Withdrawals on the Shanghai Gold Exchange were 126 tonnes during the two week period ended July 31, 2015 vs. 85 tonnes delivered on COMEX during calendar year 2014.

Volume of Gold Withdrawals on the Shanghai Gold Exchange

Shanghai Gold Exchange chart showing cumulative gold withdrawals 2009-July 2015.

Withdrawals of gold on the Shanghai Gold Exchange for the week ended July 31, 2015, were over 53 tonnes.

The volume of withdrawals of gold on the Shanghai Gold Exchange as of July 31, 2015, are running 34% higher than 2014 during the same period and 8.6% higher than 2013’s record pace.

Shanghai gold exchange gold withdrawal chart 2009-2015 july 31 2015

Withdrawals of gold as of July 31, 2015 on the Shanghai Gold Exchange are heading towards eclipsing the record set in 2013.

China is becoming the center of the Asian gold world. A $16 billion China Gold Fund was announced in May and the Shanghai Gold Exchange continues to establish itself as viable competitor to the gold trading centers in London and Chicago. China’s gold imports, trading and mining production are one of the cornerstones of China’s de-dollarization/Yuan strengthening initiatives that focuses no so much on selling U.S. Treasuries but creating alternative financial systems like the Asian Infrastrucure Investment Bank.

silk road gold char

Russia, India, Turkey and China are consuming a bulk of the world’s gold as gold heads west to east.

China is widely believed to be making a play for inclusion in the International Monetary Fund’s (IMF) Special Drawing Rights (SDRs) Program later this year. If China fails to gain inclusion in the SDR, its recent initiatives to strengthen its currency and gain greater acceptance of the Yuan may provide a strong alternative to the IMF regime.

China Updates its Gold Holdings

China recently announced their first update to their official gold holdings since 2009. The People’s Bank of China announced that their gold holdings had climbed from 1054 tons to 1658 tons, making China the fifth largest gold holding nation in the world.

Top 20 largest gold holding nations in the world

China’s recent update to its gold holdings put it in fifth place among gold holding nations.

The Bank of China also recently joined the auction process at the London Bullion Market Association where the price of gold is determined.

The volume of gold withdrawn from the Shanghai Gold Exchange dwarves the volume of gold delivered on the COMEX futures gold exchange where most gold futures contracts are not settled by physical delivery of gold.

In 2014, COMEX delivered under 85 tons of gold; more than twenty tons less than the amount that was withdrawn from the Shanghai Gold Exchange during the past two most recently reported weeks!

The volume of gold withdrawn on the SGE (126.63 tons) in two weeks ended July 31, 2015, is also greater than the amount of gold that Germany has managed to repatriate from the New York Fed since January 2013 through March 2015 (90 tons).

In addition, the new Chicago Merchatile Exchange futures contract for Hong Kong Kilobars has experienced withdrawls of nearly five tons of gold a day since it began in mid March earlier this year. As of August 6, 2015, 407 tons of gold have been withdrawn pursuant to this program for an annualized run rate over 1,200 tons of gold a year.

COMEX Hong Kong Gold Kilobar Withdrawals Through August 6, 2015

chart showing COMEX hong kong gold kilobar withdrawals august 2015

Comex Hong Kong gold kilo bar withdrawals have been averaging over five tons of gold a day.

Along with India, China consumes much of the world’s gold. Depending on any given month, either China or India is the number one gold consumer in the world. Together they account for approximately 3,000 tons a year in gold demand.

China and India Gold Demand

Chinese and Indian gold demand chart as of May 2015

China and India make up a good portion of global gold demand.

Russia has also been adding to its gold reserves at a rapid pace. Here is a chart that adds Russian and Turkish gold demand to Chinese and Indian demand.

russia india china and turkey gold demand 2008-2015 chart

The Bank of China also recently joined the auction process at the London Bullion Market Association where the price of gold is determined.

China is the world’s largest gold producer:

Chinese mining production chart

China is the world’s largest gold producer with mining production over 2,000 tons the past five years.

In addition to the vibrant Shanghai Gold Exchange and increasing world leading gold mining production, China is also the world’s largest gold importer. Here is a chart showing the volumes of gold traded on the Shanghai Gold Exchange vs. gold imported through Hong Kong as of April 2015.

Chinese gold imports through Hong Kong

China imports large amounts of gold through Hong Kong.

All charts, other than the Chinese gold mining production chart, courtesy of Nick Laird.

Shanghai Gold Exchange Volume: Gold Miner Pulse

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Further Reading:

Shanghai Gold Exchange Withdrawals (weekly archive)

Comex Gold Deliveries vs the Shanghai Gold Exchange

Gold Continues its Journey From West To East

Shanghai Gold Exchange vs Comex Gold Deliveries

Gold ETF Holdings vs the Shanghai Gold Exchange

China and Gold

India and Gold

Russia and Gold

Gold and Silver Price Manipulation – Suspected

Gold and Silver Price Manipulation – Actual

Gold Reserves by Country – Top Twenty

Gold Moves West to East Part 1

Gold Moves West to East Part 2

Gold ETF Holdings on the Rise

Chinese vs. United States Gold Demand

Chinese Gold Production

China Hoards its Gold Production

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