Gold Production – Did you know?
Now, I would have said that South Africa’s mines produced the largest amount of gold. A few years ago, I would have been correct but not anymore.
Which country do you think produces the largest amount of gold? Do you think the US surpassed Africa? Well, the US produces more than Africa, but the US slipped to the third place looking at the production in the first half of 2009.
Australia surpassed the US taking second place, but who’s in first?
Gold production for the first half of 2009:
4th place – South Africa at 103 tons
3rd place – US at 105 tons
2nd place – Australia at 112 tons
1st place – China at 147 tons
Interesting….
Now, let’s take a look at the order by land mass. The US is the largest in square kilometers followed by China, Australia and South Africa.
If you look at gold production per square kilometer, the results provide a different order.
Using the first half 2009 yields, South Africa produced 2.7 troy ounces per square kilometer, China mined .49 troy ounces per sq km, Australia obtained .46 troy ounces per sq km and the US returned .35 troy ounces per sq km.
For pure volume, China is the number one producer. But when you add in land mass, South Africa still has the richest mines.
And, why is this interesting? Well, gold is in high demand and the rates per troy ounce continue to climb.
Over the holiday week, gold had a high of $1192 per ounce. Today, the price currently hovers over $1170. Yes, that’s a decrease from the high of $1192, but the gold pundits expect the rate to continue upward. Perhaps they are right. As an indicator, the coin and gold dealers see an ongoing stream of buyers for gold.
Demand = high and supply = low produces an increase in prices.
Resources:
Australia ousts US as second-biggest gold producer, SA slips to fourth
World Statistics [sorted by Area]
Metric Tons (or Tonnes) to Troy Ounces Conversion
UK Mint Increases Gold Production
Both interest in and demand for gold increases around the world.
Take a look at these highlights from a Bloomberg article by Thomas Biesheuvel and Nicholas Larkin:
>> UK’s Royal Mint more than quadrupled production of gold in the 3rd quarter
>> Gold is set for a ninth annual gain which would be the longest winning streak since 1948
>> Gold has gained about 29% this year while the dollar has decreased by 7.3%
>> Sales of American Gold Eagles more than doubled in the first 3 quarters to 954,000 ounces
>> Global gold demand climbed 10% in the 3rd quarter to 800.3 metric tons
>> The Austrian mint, the world’s largest marketer of pure gold coins, sold 1.9 million ounces so far in 2009 which is 23% more than all of 2008
>> Harrods, the London department store, began selling gold bars and coins for the first time in October
>> India bought 200 metric tons of gold last month followed by a smaller purchase by Maritius
>> Bank of America Merrill Lynch, Societe Generale SA and Barclays Capital forecast further purchases by central banks.
>> The UK mint’s use of silver increased 56% over the previous year
>> Bullion holdings in some exchange-traded funds have risen to records in recent months
>> David Russell, a director at Dublin-based brokerage and bullion dealer GoldCore Ltd., said in an interview, “There’s still a total lack of confidence in the financial system . Investors are seeing the benefits of diversifying into gold. Smaller investors are clued into the fact that inflation possibilities are a worry for the future. It’s a tangible asset, and its value can be quickly and easily realized. We’re seeing very good demand in the coin market. Many investors are aware that they’ve been poorly diversified over the past few years.”
To view the Bloomberg article, click on this link U.K. Royal Mint Quadruples Production of Gold Coins
Perhaps a key point in this article is “gold is a tangible asset.”
Corporations struggle and their stocks and bonds decrease in value. Those stocks and bonds – at least some of them – become worth only slightly more than the paper or digital memory they are printed on.
But, gold, the heavy metal with a deep yellow gleam, can be held. To many, that touch provides comfort and reassurance that they have a worthwhile asset instead of near worthless shares of stock.
By the way, on a side note, that 200 tons of gold purchased by India for $6.7 billion dollars would cost over $7.3 billion dollars this week.
Oh, and remember, while this global demand for gold is increasing, the gold production from raw ore is decreasing on a per ton basis.
The saga continues….just how high will the price of gold go with increased demand and dwindling supplies?
Gold Continues Upward Climb
Just take a look at this latest chart from Kitco:
Isn’t that interesting? Over $200 climb in that six month period.
But what about proof gold? Did you know that it is over $2000 now?
Of course, the better proof gold, such as MS-70, has a premium price as well.
Individually, the prices vary based on the specific type of coin and its corresponding grade.
One dealer speculates that proof gold will be trading over $2200 an ounce by the end of the year. That’s a $200 spread in less than two months.
As one of our dealers commented at the Sunday show, “It’s much easier to sell gold right now than it is to buy it.”
The demand for physical gold continues strong. That adds to the age old supply and demand problem. The supply gets tougher to find as the demand increases causing the prices to increase as well.
For those of you who invest in the stock market and who invest in gold “paper,” you may consider it time to become a little paranoid. If physical gold is difficult to find, are you sure that gold “paper” has any physical gold behind it? In other words, is your investment safe? Does it have real value?
With the various and sundry dirty deeds by investment types increasing, are you confident that your gold investment on paper really exists?
Sometimes, when the economy gets tough, gold that you can touch, hold and keep safe yourself is better than an unseen and perhaps imaginary investment.
UK’s Telegraph Articles on Gold
Gold exists today in gold coins, gold bullion (bars of gold), gold jewelry and other refined gold uses including edible gold. Gold also continues to be mined in various parts of the world.
Currently, the market price per ounce of gold increases almost daily.
One of Britain’s news outlets, the Telegraph, included articles about the source of gold ore and the price of gold. Both of these articles provide additional insights into the rise of the gold prices.
In the first article, Aaron Regent, president of the largest gold production company – Barrick Gold, stated, “”Production peaked around 2000 and it has been in decline ever since, and we forecast that decline to continue. It is increasingly difficult to find ore.”
The article went on to discuss how the ore quality has decreased significantly in grams per ton since 1950. In other words, it takes a lot more tonnage of ore to obtain the same amount of refined gold.
Click here: Barrick shuts hedge book as world gold supply runs out to find the article on the telegraph.co.uk web site.
In a companion article, the Telegraph interviews several analysts from various investment and economic backgrounds. Some think gold has almost reached its peak price. Others think it will continue to rise.
Click here: Gold: how high can the price go? to view the various opinions. And, that’s what they are – opinions.
Rather than separate, the two articles should be read together. It seems the opinions are based more on the economy rather than including the diminishing supply issue.
When the supply gets scarce, the price will go up. When will the supply get that scarce and when will the demand push the rate up? That remains to be seen.
But, alchemists of old learned they could not create gold from other substances. Even with today’s technology, we can’t either. The best we can do, perhaps, is use technology to help us find the sources of gold ore.
Another Reminder – Two shows this Sunday, November 15
The Greater Atlanta Coin Show and the North Atlanta Sports Collectibles Show occur together this Sunday, November 15 at the Holiday Inn Select hotel. This is the last month the two shows coincide this year.
In one trip to one location, you will find collectible and investment grade coins and bullion along with sports memorabilia and collectibles. Plus, you can buy, sell and trade at either show.
Don’t miss this last opportunity of the year to find two shows at one location.
Sunday, November 15, 2009
9:00 a.m. until 5:00 p.m. – Coin Show
10:00 a.m. until 5:00 p.m. – Sports Show
Holiday Inn Select-Atlanta/Dunwoody
4386 Chamblee-Dunwoody Rd.
(I-285 @ Exit 30 – Chamblee-Dunwoody Rd.)
FREE ADMISSION
Sports Collectibles Show info:
Frank Moiger – 678.644.6057 / utvol69@aol.com
Coin Show info:
Bob O’Brien – 770.772.4359 / www.atlcoin.com
Dahlonega Gold
In 1840, how many $5 gold pieces (half eagles) were minted by the Dahlonega Mint?
Per the population resources, just under 23,000 coins were minted that year in Dahlonega. Additionally, the resource states that scarce varieties exist.
This past weekend, a friend showed us three – count ‘em, three – different 1840D $5 gold pieces that he has collected.
Today, we take for granted computers, imaging programs and computerized machines that can quickly transfer artists’ obverse and reverse renderings into dies for the minting process.
In 1840, the dies were made by hand. And, in 1840 at least three different dies were made for the $5 gold piece minted in Dahlonega.
Today, the Dahlonega mint is partially remembered at Price Memorial Hall at North Georgia College and State University. Were these dies made at the Dahlonega Mint, now Price Memorial, or were they made at some metal worker’s shop? Was the metal worker local or from somewhere else?
There are Dahlonega gold collectors, and of those, there are a few who have studied in great detail the history and workings of the Dahlonega Mint.
Numismatists, in general, learn history. Some learn the numismatic history where others additionally learn about the era when the coins were used and how they came about.
Wouldn’t it be interesting to learn more about the Dahlonega Mint?
An author, Douglas Winter, wrote about the Dahlonega Mint from a numismatic viewpoint. In addition to his knowledge and research, Mr. Winter tapped into expert collectors of Dahlonega Gold and Dahlonega Mint history.
Mr. Winter’s books can be found on Amazon.com:
In the meantime, it was interesting to see all three varieties of the 1840D $5 gold coins side by side. Interestingly, Dahlonega gold continues to hold collectible value over and above the rising cost of an ounce of gold – whether in low or high grade condition.
Have fun researching and learning about Dahlonega gold. Start your own collection of coins that are both investment and collectible quality.
TSNS Coin Show
For any of you interested in a coin show this weekend, the Tennessee State Numismatic Society coin show is being held at the Camp Jordan Arena. The show dates include Friday, November 6 through Sunday, November 8. (Click on www.tsns.org for more details about their coin show and convention.)
Many of the GACS dealers attend the Tennessee State Convention. Of course, the Greater Atlanta Coin Show will be next weekend on Sunday, November 15.
For those of you who like the efficiency and variety of two shows at the same location, the November 15 Sunday has both the Greater Atlanta Coin Show and the North Atlanta Sports Collectibles Show at the Holiday Inn Select.
The Greater Atlanta Coin Show opens at 9 am for guests and the North Atlanta Sports Collectibles Show opens at 10 am. Both shows close at 5 pm.
Free admission!
See our main web site (www.atlcoin.com) for more information about the coin show and the dealers. For more Sports Collectibles Show info, contact Frank Moiger: 678.644.6057 / utvol69@aol.com
Gold just keeps on a-climbing…
Are you watching the gold prices climb?
Kitco's 10 Year Gold Chart
The price almost kissed $1100 per ounce this week. That’s amazing. Look at the upper corner of Kitco’s 10 year chart. The low in the last 10 years was $255.30 in 2000/2001. Now, in 2009, it will likely surpass $1100.
Some pundits claim that the market has been artificially held back and that the rate should already be much higher. Others claim the price will soon be over $2000 per ounce.
Are either of these viewpoints correct? Many variables determine the markets.
In the meantime, India recently bought 200 tons (yes, TONS) of gold at $1045 per ounce. Their purchase definitely impacted the gold market. Interestingly, they bought the gold with US dollars weakening the dollar’s position in the world markets while building their gold reserves.
What does this mean to our day-to-day lives?
Historically, when the economy declines, gold prices increase dramatically. Well, just look at the number of people losing their jobs, the foreclosures in the housing markets and the decrease in spending. The economy certainly declined.
The question remains how far will gold go up?
Certainly, people propose many opinions on the price of gold and on the economy, but the future variables remain unknown.
Next Show – November 15
This is just a reminder that the next show is November 15.
If you have a flyer with a different date or have seen a different date on other web sites, the show is Sunday, November 15.
Early in the year, we realized we had a conflict with another show in the area on the previously chosen date. The hotel allowed us to move the date to November 15 to miss the conflict.
We hope to see you there!
