China Gold Imports From Hong Kong Fall 53 Percent as Price Drops

China Gold Imports From Hong Kong Fall 53 Percent as Price Drops

Gold shipments to China from Hong Kong declined by more than 50 percent in November as demand from investors weakened after prices slid for a third month. Net imports, after deducting flows from China into Hong Kong, were 60.9 metric tons in November, from 129.9 tons in October, according to data from the Hong Kong Census and Statistics Department. Still, the amount in the first 11 months of the year has more than doubled to 1,017 tons, the data show.Bullion fell 28 percent this year, set for the worst slump in three decades, as the Federal Reserve said it would taper stimulus. The price is set for the first annual drop in 13 years as some investors lose faith in the precious metal as a store of value amid a record rally in U.S. equities. Gold holdings in exchange-traded products slumped 33 percent this year.

“As bets on higher prices diminish, Chinese investors’ appetite for bullion seemed to be waning,” said Jiang Shu, a senior analyst at Industrial Bank Co. in Shanghai. “Anecdotal evidence from retailers here also presented the same picture that sales in the second half of this year weren’t as brisk as in the first half.”

The metal for immediate delivery in London traded at $1,198.76 an ounce at 11:48 a.m. Shanghai time, down 4.4 percent this month after a 5.3 percent drop in November. The price tumbled to a 34-month low of $1,180.50 on June 28. Bullion of 99.99 percent purity on the Shanghai Gold Exchange fell 6.7 percent last month, declining for a third month.

Gold, iron ore, soybeans and copper may drop at least 15 percent next year, Goldman Sachs Group Inc. said last month. Bullion has fallen 38 percent from a record $1,921.15 in 2011.

Overtaking India

Still, China is on course to overtake India as the world’s biggest bullion consumer as demand reaches 1,000 tons this year, according to the World Gold Council.

China’s demand for jewelry, bars and coins rose 30 percent to 996.3 tons in the 12 months through September, while usage in India gained 24 percent to 977.6 tons, according to the London-based WGC. While analysts in a Bloomberg News survey see consumption easing 2.4 percent in 2014 from a record 1,000 tons in 2013, purchases will still exceed those of any other nation and the U.S., Europe and the Middle East combined.

The mainland bought 107.4 tons last month, including scrap, compared with 147.9 tons a month earlier, such figures from the Hong Kong government showed. China’s purchases in November were 18 percent higher than the 90.8 tons a year earlier, according to the Hong Kong data. Mainland China doesn’t publish such data.

Exports to Hong Kong from China were 46.4 tons in November, according to a separate statement from the Statistics Department. That compares with 18 tons in October and 29 tons in November 2012.

To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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