China Becomes World's Biggest Gold Producer

China Becomes World's Biggest Gold Producer
(Industry Week – Agence France-Presse)

Overtaking South Africa which held top spot for 100 years, China became the world's biggest producer of gold last year, the independent precious metals consultancy GFMS said on April 9. China posted a 33 ton increase in gold output.

GFMS chairman Philip Klapwijk said China was expected to consolidate its lead in 2008, "primarily as a result of further declines expected in South Africa due to its ongoing power supply issues."

"Africa saw the heaviest regional drop at 29 tons – chiefly due to South Africa – while output in North America and Latin America also fell ... In contrast, Asia saw gains, centered on Indonesia and China, with the latter becoming the world's leading gold producer in 2007," it added.

Meanwhile the price of gold was on course to reach a record high of $1,100 an ounce in 2008 amid global financial turbulence, GFMS added in its latest annual Gold Survey.

Gold struck an all-time peak of $1,032.70 an ounce on March 17, four days after the yellow metal breached $1,000 for the first time.

Gold prices have won strong support this year from supply problems in South Africa. Stoppages by miners protesting unsafe working conditions and ongoing power cuts in South Africa have hampered supplies.

"Global mine production fell by a slight 0.4% in 2007 to an eleven year low," GFMS said.