30 January, 2020

Technology demand weakened again in 2019, but the outlook is more optimistic; 2020 should herald strong demand growth in the electronics wireless sector

  • Full-year gold demand in the technology sector fell 2% y-o-y to 326.6t 
  • 2019 was a weak year for the whole electronics industry, and this contributed to a 2% fall in demand for gold in the sector
  • However, Q4 demand showed signs of recovery, posting a 1% y-o-y increase to 68.2t. This was driven by strong growth in wireless applications as 5G installations gained traction. 
Tonnes 2018 2019 YoY
Technology 334.8 326.6 -2%
Electronics 268.4 262.6 -2%
Other Industrial 51.2 50.1 -2%
Dentistry 15.3 13.9 -9%

While electronics demand showed signs of recovery, gold used in the dental sector continued its steady decline with a 9% y-o-y fall to 14t in 2019. Other industrial applications experienced a minor fall of 2% y-o-y to 50t.


Gold used in electronics fell 2% to 262.6t in 2019. This is perhaps not a huge surprise considering the overall weakness of the sector during the year. Forecasts for the semiconductor market – a traditional bellwether of the industry – are down by almost 13% compared with 2018, with falls across all major sectors.1 However, a recovery does appear to be in progress, with the World Semiconductor Trade Statistics group predicting a return to growth of 5.9% in 2020. Our data supports this forecast, with demand for the final quarter posting a 1% y-o-y increase to 68.2t.

The strong Q3 growth in the wireless sector continued in Q4, with a 30-40% increase in gold demand y-o-y. This was driven by the rapid acceleration in 5G infrastructure deployment around the world. Major chip manufacturers, such as Taiwan’s WIN Semiconductor Corp, are reportedly planning expanded production capacity in 2020 due to 100% utilisation rates at their current facilities. We believe this sector will be positive for gold demand for some time to come; 5G infrastructure demand is just beginning to ramp up, and new applications such as vertical cavity surface emitting lasers (VCSELs) and power amplifiers will add further demand for the technology. 

Traditionally a low season for LEDs, Q4 2019 was down 6-8% y-o-y. The market remained sluggish with new mini- and micro-LED technology threatening traditional LEDs, which have higher gold utilisation rates. Additionally, while a preliminary deal has been signed by both China and the USA, the trade war remains a concern and continues to weigh on many industries that are heavy users of LED technologies. 

The memory sector rebounded into growth during Q4, albeit at relatively low levels of 1-3% y-o-y. As we reported last quarter, major manufacturers such as Samsung and Micron appear to have successfully normalised their inventories after two years of rapid growth and expansion. There are a handful of technological threats to gold demand in the sector, such as the miniaturisation of memory devices in some mainstream products potentially pressuring gold bonding wire usage. However, 5G related applications and data housing construction are expected to drive growth in the memory sector during 2020.

Finally, the Printed Circuit Board (PCB) sector registered a healthy rise of 7-10% y-o-y during the quarter. This was driven by the ramping up of 5G infrastructure deployment, alongside recoveries in consumer electronics and Artificial Intelligence demand. While there is an ongoing threat from miniaturisation in some sectors, demand remains strong in key sectors such as the automotive industry where PCBs are critical components of the electronic devices present in modern vehicles. Indeed, we believe we will see continued growth throughout 2020 in the PCB sector.

Of the four key electronics fabrication hubs around the world, only Japan registered a fall of 1.9% y-o-y. Mainland China and Hong Kong, South Korea and the US all saw small increases in gold volumes during the quarter of 2.8%, 3.9% and 1.1% respectively.

Other industrial and dentistry

Dental demand continued its inexorable decline, falling 10% y-o-y in Q4 to 3.2t. Demand for gold used in other industrial applications was down 4% to 12.4t; subsequently, annual demand was down 2% to 50.1t. This was in part due to the US-China trade dispute, which hit end use in the luxury accessories sector.

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