Caledonia Mining Corporation (CMCL)

[NYBob]

Chinese gold imports – a big driver of the gold price

Source: Reuters
In the Market for Gold Mines?



China will need to step up its gold purchases, and secure future supply at a good price, is to buy gold mines around the world.



This has started happening.
ex.
Late last year, China Gold International Resources Corporation, one of China’s largest gold producers, acquired a mine in Central Asia, and now might pick up more in Canada and Mongolia.

A Shanghai-based group has since picked up a controlling interest in an Eritrean gold project, Zara Mining.
Keep An Eye on Gold Buying by India

There is another reason Indian gold imports should increase from here.
India has already come back into the physical market in size. Even if Indian demand doesn’t recover straight away, this is an opportunity for China to pick up what India can’t afford.

In the Market for Gold Mines?

China will need to do to step up its gold purchases, and secure future supply at a good price, is buy gold mines around the world.

This has started happening.

Late last year, China Gold International Resources Corporation, one of China’s largest gold producers, acquired a mine in Central Asia, and now might pick up more in Canada and Mongolia.

A Shanghai-based group has since picked up a controlling interest in an Eritrean gold project, Zara Mining.

Zijin Mining Group made a bid for an Aussie gold stock, Norton Goldfields (ASX:NGF).
This is a 150,000-ounce-a-year producer with plans to increase production to 220,000 ounces over the next four years.
You can expect to see a lot more of this, if China wants to seriously ramp up its gold reserves.

A serious move by China to increase gold reserves by acquiring projects is great for gold investors. Firstly, speculation over takeovers can often give share prices a nudge.

More importantly, because these mines have a long mine life, it tells investors China’s plans to buy gold take a long-term view.

China Gold Imports Up 782% First 4 Months Of 2012 From Data Out Of Hong Kong ...

Chinese govt advise gold buying - why?

China Builds its Gold Reserves

China has been busy, but its official gold reserves are only worth US$55 billion.
The core Euro countries of Germany, Italy and France have around US$430 billion of gold, and the US claims to have US$424 billion of gold.

But it’s been three long years since the People’s Bank of China last updated us on its gold holdings in 2009, when the count was 1054 tonnes.
This was almost double the gold it had when it reported before that in 2003.
We can safely assume China has been adding to its official reserves in the last three years.
It’s anyone’s guess how much by.

If the amount of gold the Euro nations and the US government have on their books is any guide, you can see that China needs eight times more gold than it last reported to confidently back its currency for internationalisation.
That would take the world’s entire annual mine output for at least three years.

This makes Chinese gold demand the most important of all the gold price drivers, and a very good reason to be bullish on gold long term.

That’s why I read yesterday’s news – that China has made another important step towards internationalising its currency – as being a very bullish result for the long-term gold price outlook.

China’s gold demand should support higher gold prices, but it’s not all good news for gold bugs.
China’s growth also means a growing military power.
And this may pose a threat to some of the gold producing countries close to its borders that Aussie gold producers are operating in.

Over the next four years, China’s military budget will grow to almost half that of America’s.
There is growing geopolitical chess game playing out between the two.

Gold to Rally Above $1,900 by End 2012: HSBC
Sunday, August 5, 2012 At 11:09PM

Gold could be one of the few assets to profit from the political and economic turbulence in the United States as the “fiscal cliff” approaches, potentially creating a rally in the precious metal later in 2012 for it to reach $1,900 per ounce by the end of the year, analysts at HSBC said.

“Economic uncertainty, geopolitical tensions and the uncertainty of the U.S. November elections are theoretically gold-bullish,” and gold should perform better later in the year “when U.S. growth is poor and the dollar is weak,” a new HSBC report said.
“We expect prices to rally to above $1,900/oz by the end of the year.
Patience is the most important commodity.”

HSBC recommends holding onto gold as an asset that will gain in value as investors fear the future of the euro and dollar with governments and central banks expected to intervene to shore up their currencies’ strength.

Sinclair— Gold could hit $3000 - American Advisor Precious Metals Market Update

With central banks continuing to buy significant amounts of gold,
China agreeing to settle commerce with Iran in gold, and a
possible conflict between Israel and Iran looming,
legendary investor Jim Sinclair says gold prices could rise to $3000.

Chart 2: US Federal Budget (Surplus or Deficit As A % of GDP,
12 Month Moving Average) and Gold London P.M. Fixed


Caledonia Mining's major shareholder Pinetree Capital Ltd.
and # 2.
Sheldon Inwentash keep buying more and
more for himself privatately after the NAMA N/R must be very happy about
all good CALVF news -



http://investorshub.advfn.com/boards/read_msg.aspx?message_id=78687314

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=78683901