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Turd Ferguson Interviews Koos Jansen

Turd Ferguson interviewed me last Thursday (October 9, 2014), a conversation worth sharing because we talked about a lot of subjects, like Chinese gold demand (government demand and non-government demand), the Shanghai Gold Exchange, the PBOC, the SDR, the IMF, the Turkish gold market, the Chinese silver market, etc. There were of course a thousand things I forgot to mention, but I guess that’s inherent to an interview. 
 
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SGE Chairman: 2013 Chinese Gold Demand Was 2000t

This is the final blow for the ones who still couldn’t comprehend, after all evidence presented, the amount of Chinese non-government gold demand in 2013. At the LBMA forum in Singapore June 25, 2014, one of the keynote speakers was chairman of the Shanghai Gold Exchange (SGE) Xu Luode. In his speech he made a few very candid statements about Chinese consumer gold demand, that according to Xu reached 2,000 tonnes in 2013. In contrast to the Word Gold Council (WGC) that states Chinese gold demand was 1,066 tonnes in 2013.

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China Buys 45t Of Gold Ahead Of Golden Week

The National Day Golden Week, a one week holiday in China mainland, yes, the Chinese name their holidays golden, began on October 1 this year, so that’s when trading stopped on the Shanghai Gold Exchange (SGE) and Shanghai Futures Exchange (SHFE). This means I only have half a story for you today.
The latest withdrawal data from the SGE always lags one week and is thus from week 39 (September 22- 26), other data from the SGE and SHFE covers week 40, which in this case covers only 2 days (September 29 – 30).

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Confirmation PBOC Doesn’t Purchase Gold Through SGE

Last week I wrote Scotiabank had released an unveiling report  on Chinese gold demand, written by Na Liu of CNC Asset Management Ltd.. In the report Na stated what I’ve been publishing for over a year: the amount of gold withdrawn from the vaults of the Shanghai Gold Exchange equals Chinese wholesale gold demand. This report put a little smile on my face as it was another confirmation of my research (SGE chairman Xu Luode previously confirmed the relationship between withdrawals and demand, at the LBMA forum in Singapore).

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New York Fed Gold Stock Tumbles 15 Tonnes In August

Every month the Federal Reserve bank of New York (FRBNY) publishes the amount of gold it holds in custody for 36 foreign central banks and the IMF. After a significant drop in July of 24 tonnes, 15 tonnes were withdrawn from the vaults in August. Germany is the only country, that I’m aware of, currently repatriating gold from New York. This suggest all withdrawals year to date have been shipped to Frankfurt. 
 
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China Aims For Official Gold Reserves At 8500t

China should accumulate 8,500 tonnes in official gold reserves, more than the US, according to Song Xin, President of the China Gold Association, General Manager of the China National Gold Group Corporation and Party Secretary. He wrote this in an opinion editorial published on Sina Finance July 30, 2014. Gold is money par excellence in all circumstances and will help support the renminbi to become an international currency as “gold forms the very material basis for modern fiat currencies”, Song notes.

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Chinese Gold Demand Explosive

Whilst western media are still under the assumption Chinese gold demand is declining, based on data from the World Gold Council and net gold export from Hong Kong to China mainland, in reality demand is extremely strong. As I’vepreviously written, the lower the price of gold will go the more physical gold will be purchased by the Chinese people, and the price of gold has been dropping since mid August. 
 
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The Workings Of The Shanghai International Gold Exchange, Part One

As most of you have probably have noticed last week the Shanghai Gold Exchange (SGE) launched it’s subsidiary the Shanghai International Gold Exchange (SGEI) located in the Shanghai Free Trade Zone. Much has been written in recent days about SGEI, but how does the new gold exchange actually operate? How can you and I participate in the Chinese gold market and how does this affect the global gold market? Well, you and I can trade physical gold in renminbi through an exchange in China from now on, how this will affect price discovery (of gold) we’ll see in the coming months and years. 

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Chinese Gold Demand 41t in week 37, 1331t YTD

Where to begin. Much has happened this week in the Chinese gold market; on wednesday the Shanghai Gold Exchange (SGE) released multiple rule books written in English describing every detail on the workings of the SGE and its brand new subsidiary the Shanghai International Gold Exchange (SGEI). Finally the world can read everything about the Chinese exchange that is the strongest force in the physical gold market, but was widely misunderstood because of the language barrier. Though having channeled unprecedented amounts of physical gold into China mainland the SGE has been enjoying little coverage in the mainstream media. 

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Chinese Gold Demand 39t In Week 36, YTD 1290t

Robust Chinese gold demand is keeping up its pace. Chinese wholesale demand, measured by withdrawals from the Shanghai Gold Exchange vaults, was 39 tonnes in week 36 (September 1 – 5). Year to to date 1290 tonnes has been withdrawn from the SGE vaults.  
 
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India’s June Gold Import Highest in 12 Months

Despite the fact the new Indian government, led by Narandra Modi since May, hasn’t lowered the import duties on both gold and silver, Indians keep on buying precious metals. Despite the fact we already knew this, there was less gold being smuggled into the country and more imported through official channels last June; 77 tonnes were gross imported, which is up 48 % from a month earlier, and up 75 % from June last year. This was accompanied by falling premiums.

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German Gold Repatriation Accelerating

Headlines are easy to write, a bit of sensation in it and they will surely persuade people to read the accompanying article. Though I’m often disappointed to read articles that contain remarkably little of what the headline promises. On the other hand, I personally have written many articles that were read by few because my headline wasn’t catchy enough in a stream of apocalyptic headers readers a daily thronged upon. I call this the headline problem; no catchy headline, no readers.

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Another Week Of Strong Gold Demand In China

After a very strong week from August 18 to 22, in which SGE withdrawals accounted for 46 tonnes, the sequential week was nearly as strong; in between August 25 and 29 withdrawals from the SGE vaults accounted for 42 tonnes. Year to date 1251 tonnes has left the vaults, this is 17 % less compared to 2013. 
 
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Does The WGC Understand The Chinese Gold Market?

As I’m mostly occupied researching the Chinese gold market I feel obliged, again, to respond to the latest World Gold Council (WGC) report on China; Understanding China’s Gold Market, published July 2014. For readers ofChina specials it may appear the WGC is exposing in-depth information on the Chinese gold market, while partially true, all publications contain inaccuracies and inconsistencies and do not disclose the most crucial data that indicates Chinese gold demand is significantly higher than widely assumed. The WGC consciously withholds this data from the mainstream audience - their motives are left for speculation.

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Chinese Weekly Gold Demand Highest Since February

Withdrawals from the Shanghai Gold Exchange vaults, which equals Chinese wholesale demand, in week 34 (August 18 to 22) accounted for 46 metric tonnes, the highest weekly amount withdrawn since late February (25 weeks ago). Year to date wholesale demand stands at 1209 tonnes. It’s worth stressing that this number includes gold that is recycled through the SGE.
 
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Precious Metals Markets: China vs US

In anticipation to the launch of the Shanghai Gold Exchange international board, that presumably will start shifting gold pricing power from West to East, in this post we’ll examine the historical trading volumes of the Shanghai Gold Exchange (SGE), the Shanghai Futures Exchange (SHFE) and the COMEX. By charting the weekly volumes we get a clear view of the size of these exchanges. (In the London Bullion Market most likely the largest volumes are traded, but because this is an OTC market that doesn’t disclose much data we can’t use it in our West – East comparison.)
 
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India Imports 2559 MT Silver In 5 Months

While silver has been widely used as money in history, at the beginning of the 19th century gold became the dominant metal in trade. At the end of the 19th century central banks erupted around the world and began holding gold in reserve to back their currencies, the international monetary system in this period is known as the classic gold standard. When the last remnants of the gold standard were officially left behind n 1974, and the world was on a fiat standard, central banks held on to their gold. 

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East Asia Geared Up For RMB Gold Trading

Weekly withdrawals from the Shanghai Gold Exchange (SGE), which equals Chinese wholesale demand, have been nearly flat for four weeks in a row. 33 metric tonnes have been withdrawn in week 32 (August 4 – 8), up a modest 4.2 % w/w. Year to date 1,127 tonnes have been withdrawn, annualized 1,831 tonnes.
 
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Global Gold Trade Declines In H1 2014

After having seen unprecedented amounts of physical gold moving across the globe in the aftermath of the goldprice collapse in April 2013, trade has been less robust in the past few months. In 2013 the UK net exported 1424 metric tonnes, Switzerland gross imported 3061 tonnes and gross exported 2777 tonnes, Hong Kong gross imported 2239 tonnes and gross exported 1642 tonnes, and China net imported 1540 tonnes. Gold trade in the first half of 2014 is down form these extreme levels, mainly in the second quarter.

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Chinese Gold Demand 1094 MT YTD, Silver Premium At Record High

First let’s go through the Chinese SGE report published on August 8, which covers week 31 (July 28 – August 1). The total volume of gold traded on the Shanghai Gold Exchange (SGE) was 258 tonnes, of which 147 tonnes were traded as the spot deferred contracts Au(T+D) and mAu(T+D), the open interest closed at 141 tonnes. Total deliveries of the spot deferred contracts accounted for 55 tonnes in this week, gold withdrawn from the SGE vaults, which equals Chinese wholesale gold demand, accounted for 32 tonnes.

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HMRC And Eurostat Alter Historic UK Gold Trade Data

It was in August 2013 when I started digging into UK gold trade data. While at the time China was importing unprecedented amounts of gold, through customs data I was able to track the source all the way back to the UK, home of the London Bullion Market. In 2013 the only available database for UK gold trade was Eurostat. When downloading the numbers from 2013 and all the years before something quite remarkable appeared to me. According to Eurostat the UK imported 614 tonnes of gold in August 2008 and 1,352 tonnes in September 2008, just from one country; Germany.

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