China's gold output and demand could be far greater than ‘official' data suggest

Comment from Jeff Nichols suggests that Chinese gold production and consumption may be considerably higher than the statistics released by the country would indicate.

Author: Lawrence Williams
Posted:  Thursday , 02 Feb 2012

LONDON - 
Following the recent Mineweb article on Chinese gold production and consumption (see China enhances position as world No. 1 gold producer - but where's it all going?) we have received the following comment s from specialist precious metals analyst, Jeff Nichols of American Precious Metals Advisors and Rosland Capital, which suggests that both Chinese gold production and consumption may be considerably higher than that suggested by official and semi-official statistics coming out of the Asian giant.
Nichols avers that China's domestic gold mine output is, without a doubt, much higher than reported. Actual gold mine output could easily be close to 400 tons and possibly more for the following reasons:

• The China Gold Association (CGA) numbers reflect production by their members only -- but omit gold mined by non-members.  These include many small, unofficial mining operations some of which are illegal existing in the "underground economy".  The CGA data also excludes production from mines owned and operated by the military, which is significant according to sources.  Not to be overlooked is by-product output from copper, silver, and other metal mining activity.  Again, this is significant though hard to know just how significant.