From July 27 to July 28, over 2,000 delegates attended the 2024 China Gold Congress & Expo in Shanghai, hosted by the China Gold Association and the World Gold Council (WGC). The event, themed “Innovation-driven, Green Development, Shared Future,” focused on three key areas: gold mining, gold investment, and gold consumption. Additionally, the WGC emphasized the sustainable development of the global gold industry.
2024 China Gold Congress & Expo held after 6 years
Since the inaugural China Gold Congress & Expo took place in Beijing in 2014, this international industry event has been hosted in Beijing three times. The 4th edition occurred in Shanghai after a six-year hiatus.
As one of the organizers, the China Gold Association has consistently provided robust informational support for the gold industry’s healthy and rapid growth in China. This Congress also unveiled significant industry data, with the China Gold Association releasing the “China Gold Yearbook 2024” and the “Global Gold Yearbook 2024 (Chinese version),” among others.
Meanwhile, the WGC as the other organizer, engaged with experts, scholars, industry leaders, and policymakers worldwide to discuss innovation paths, sustainable development strategies, and future market trends in the gold industry.
The 2024 China Gold Congress & Expo emphasizes not only green development and technological innovation but also the necessity of synergistic growth within the gold industry. By organizing various themed forums and activities, the conference creates a platform for international exchange and cooperation among “gold people” worldwide, fostering stronger collaboration among gold enterprises in areas such as technological R&D, market expansion, and brand building. Amid rising global economic uncertainty, geopolitical risks, and other challenges, international cooperation in the gold industry is crucial.
Innovation drives the high-quality development of the industry
David Tait, CEO of the World Gold Council, said in his speech, “In an environment of challenges and opportunities, we are confident in the bright future of the gold market. Led by cooperation and innovation, the World Gold Council and our partners will be able to confidently respond to the changing dynamics of the gold market, and work together to drive innovation and breakthroughs in the gold market, contributing to the sustainable growth of the global economy.” The continuous cooperation with member companies and partners through programmes such as “Gold 247” promotes the digital transformation and sustainable development of the global gold industry.
2024 H1 global gold markets perform strongly
The gold market has shown robust performance in the first half of 2024, ranking among the top-performing asset categories of the year. According to the latest data from the WGC, gold price has increased by 15 percent in US dollar terms and has also seen double-digit growth in other currencies, with the CNY gold price climbing by 17%. This impressive performance is driven by strong demand for gold from central banks and investors globally.
In this context, Juan Carlos Artigas, the Global Head of Research at the WGC, stated, “Gold is a global market, and its current price reflects shared market expectations. Asian investors remain highly enthusiastic about gold and act swiftly. If Western investors match the pace of their Asian counterparts, gold prices are likely to continue rising and receive additional support.”
John Reade, Market Strategist for Europe and Asia at the WGC, stated, “In the past decade, 19% of gold demand has originated from central bank purchases. Our research with central banks worldwide indicates that most respondents believe gold will continue to increase among global official reserve assets over the next five years, driven by factors such as interest rates, inflation, geopolitical uncertainty, and ESG considerations.”
Win-win co-operation boosts global development
During the “Gold Industry Summit Forum” roundtable, Roland Wang, Regional CEO of WGC China, highlighted that confidence, perseverance, and patience are essential pillars for the gold industry’s journey. He also stressed that an open mindset, along with full communication and cooperation, can offer breakthrough ideas and opportunities to tackle current challenges.
The two-day event showcased the dynamic growth of China’s gold industry and provided valuable insights and strategies for the sustainable development of the global gold industry. The WGC believes that as the global economic landscape shifts and the international trade environment becomes increasingly complex, the significance of gold will become even more pronounced.
China market
On July 30, the WGC published the “Gold Demand Trends for Q2 2024.” As the world’s largest gold jewellery market, China’s demand for gold jewellery totalled 86 tonnes in Q2, marking a 35% year-on-year decline and a 53% drop from Q1. Demand fell 46% below the ten-year average, making it the weakest Q2 since 2009, as high gold prices and slowing economic growth rate adversely affected consumer sentiment. In the first half of the year, total demand of gold jewellery reached 271 tonnes, 17% lower year-on-year and the lowest since H1 2020. The rising gold price, which increased by 10% in March and continued to set records in Q2, led to affordability constraints, especially during peak buying periods like the May Labour Day holiday.
Meanwhile, the demand for gold coins and gold bars in Q2 2024 reached 80 tonnes, a 27% drop from Q1 but 62% increase year-on-year, and was at the highest after the record level of 2013.
Economic factors such as housing market issues, weak local equity market performance, and an uncertain economic outlook led to a cautious consumer environment and high savings rates. This led to decreased recreational and discretionary spending, as noted in McKinsey’s 2024 Chinese consumption research.
Looking forward, limited prospects for an uptick in gold jewellery demand exist in H2 in China. While Q4’s seasonal strength may offer support, fragile consumer sentiment and potential further gold price increases are likely to keep demand subdued.
Roland Wang, Regional CEO of the WGC China commented on the performance of the Chinese market, “The sharp decline in gold jewellery consumption demand in the second quarter of this year is not a ‘Chinese specialty.’ Major global gold jewellery consumption markets such as India, the Middle East, the Americas, and Europe have all seen declines to varying degrees due to historically high gold prices. In addition, China’s economy, after decades of rapid development, is facing a key point in the further comprehensive reforms, and the gold jewellery industry may be entering a new phase of development, namely market maturity. Recognising this, the entire gold industry (in China) needs to base itself on the new situation and formulate strategic development plans.”
He further noted that at the same time, facing the impact of a new round of scientific and technological revolution and industrial transformation, consumer habits are also undergoing rapid changes. Therefore, the gold jewellery retail industry needs to embrace new production capabilities, innovate and adjust existing business models and development methods, and steadily move from simple scale expansion to high-quality development that focuses on segmented markets and differentiated needs.
Looking ahead to the second half of the year, the WGC maintains a cautiously optimistic outlook on the demand for gold jewellery retail and gold investment in the Chinese market. On one hand, with nurturing economic development, the opportunity cost of holding gold is expected to decline further. Additionally, the structural weakness in the real estate market is unlikely to reverse in the short term, limiting investment channels for Chinese residents’ savings and thus supporting safe-haven assets like gold. On the other hand, if gold prices remain stable, investors may lack motivation to enter the market. The demand for gold jewellery in China might improve in the second half, but the extent will depend on the future economic development trajectory.
Promoting Hard Pure Gold
Regional market visits by the WGC confirmed that lightweight, affordable products are gaining traction. Sales of 24K hard pure products outperformed other categories, with consumers favouring lighter, lower-cost items. Following recent retail network expansions, the industry is facing consolidation, with jewelers promoting higher-margin, intricate designs to sustain profits.
At a promotional event hosted by the WGC together with 11 retail partners in Shanghai on August 2, Roland Wang highlighted that the concept of Hard Pure Gold was formulated by the WGC last August. The market conditions have made this category increasingly popular due to its “hard, light, and bright” attributes, especially amid conservative spending and high gold prices. Many Hard Pure Gold products have achieved the intricate design and surface luster of 18-karat gold while maintaining light weight, durability, and purity.
