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Demand and supply statistics

Gold Demand and Supply – First quarter 2012

At 1,097.6 tonnes, first quarter global gold demand was 5% below the outstanding levels seen in Q1 2011. With average prices materially higher than the same quarter in 2011 this equated to a value of US$59.7bn, 16% higher year-on-year. Demand for gold in the jewellery and technology sectors declined in response to US$ prices that were, on average over the quarter, 22% above year-earlier levels. Growth in the investment sector was led by an improvement in demand for ETFs and similar products, although demand for gold bars and coins moderated in comparison with the exceptionally strong first quarter of 2011. Central banks made a solid contribution to demand, albeit lower than the very strong net inflows seen in Q1 2011.

  • Investment demand was the only sector of the gold market to register year-on-year growth in the first quarter, which was led by solid demand for ETFs and similar products. Inflows into the sector of 51.4 tonnes almost cancelled out the 62.1 tonnes of net outflows in Q1 2011. Demand for medals and imitation coins, a category of demand dominated by India, grew by 7% although remained very modest at 26.6 tonnes.
  • The other areas of investment demand (physical bar demand and official coins) were unable to sustain the lofty levels seen in Q1 2011, a time when bar and coin investment surged on increasing inflation concerns in a number of countries, Europe’s sovereign debt crisis and the unfolding of events in the Middle East which quickly snowballed into the ‘Arab Spring’. Demand for gold bars and coins, at 260.0 tonnes and 51.3 tonnes respectively, was nevertheless very robust in a longer-term context.
  • Demand in the jewellery sector of 519.8 tonnes was down 6% year-on-year, largely in response to higher price levels. However, the fact that the quarterly average price was 22% higher suggests that demand for jewellery remains relatively inelastic. In US$ terms, the value of jewellery demand grew by 14% to a record US$28.3bn. Weakness was concentrated in India, a number of Middle Eastern markets and Europe, while a number of markets, primarily China, Russia and Egypt, generated growth.
  • Consumer demand in India was relatively weak in the first quarter compared with the year earlier period. At a time of high and volatile local gold prices, consumers struggled to digest a rise in import taxes on gold and the introduction of an excise duty on gold jewellery, which prompted jewellers country-wide to strike. After the end of the quarter, and in response to the strike, the government announced that the excise duty would be withdrawn. Investment demand saw the largest decline – down 46% to 55.6 tonnes – while jewellery demand fell by 19% to 152.0 tonnes.
  • The official sector remained a net purchaser of gold; demand totalled 80.8 tonnes in Q1 2011. Purchases by central banks in the first quarter were geographically widespread, with a number of banks making significant purchases.
  • At 107.7 tonnes, demand for gold used in technology, dentistry and other industrial applications was down by 7% compared with year-earlier levels. This segment of the market was affected by higher gold prices, fragile consumer demand in many key markets, swollen inventories and substitution losses.
  • In terms of the supply of gold to the market, total supply increased by 5% year-on-year to 1,070.3 tonnes. The first quarter saw modest growth in mine production to 673.8 tonnes, which was slightly offset by a halving of (already minimal) levels of producer hedging, to just 5.0 tonnes. The supply of gold from recycling activity was up 11% year-on-year to 391.5 tonnes.

Read more about Gold Demand Trends in our detailed report, which also includes commentary on supply.

Press release: Gold Demand Trends Q1 2012 press release

Data on the supply and demand for gold are compiled by Thomson Reuters GFMS. The company provides a number of tables exclusively for the World Gold Council. The following table shows a summary of gold demand. Links to more detailed tables, and to notes and copyright information, are given below. Please note the restrictions on disseminating these data.

Demand and supply statistics files

End-use demand (tonnes) This provides details of jewellery demand, technology fabrication, official sector purchases and all categories of investment which are statistically identifiable.
End-use demand ($m) Similar information in US dollars.
Supply and demand (tonnes) In addition to a summary of demand information this also shows the categories of supply: mine output, net hedging or de-hedging by mining companies and recycled gold.

Gold Demand 

Demand table

Demand table - click to enlarge

1 Provisional.
2 Percentage change, 12 months ended March 2012 vs 12 months ended March 2011.
3 Exchange Traded Funds and similar products including: Gold Bullion Securities (London), Gold Bullion Securities (Australia), SPDR® Gold Shares (formerly streetTRACKS Gold Shares), NewGold Gold Debentures, iShares Comex Gold Trust, ZKB Gold ETF, GOLDIST, ETF Securities Physical Gold, ETF Securities (Tokyo), ETF Securities (NYSE), XETRA-GOLD, Julius Baer Physical Gold, Central Fund of Canada and Central Gold Trust, Swiss Gold, Claymore Gold Bullion ETF, Sprott Physical Gold Trust, ETF Securities Glitter, Mitsubishi Physical Gold ETF, Credit Suisse Xmtch, Dubai Gold Securities, ETF Securities Physical Asian Gold Shares, Claymore Gold Bullion ETF (Non-hedged), DB Physical Gold and iShares Physical Gold.

Source: Thomson Reuters GFMS, LBMA, World Gold Council

© Copyright 2012 World Gold Council and Thomson Reuters GFMS. All rights reserved.

Data on the supply and demand for gold is compiled by Thomson Reuters GFMS. The company provides a number of tables exclusively for the World Gold Council. Please refer to the notes and copyright information for details regarding the restrictions on disseminating these data. Thomson Reuters GFMS should be contacted for further information or for historical data. In addition, certain data is available on Bloomberg

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