China to maintain gold focus

The China Money Report

 

April 10, 2012 / D.Collins 

 

IT was just the tip of the iceberg. We’re talking about last week’s

move by Zijin Mining Group to launch a $299 million bid for Norton
Gold Fields (NGF), which operates the Paddington goldmine near
Kalgoorlie.

There was some surprise expressed at this: while Chinese companies
have been snapping up bulk and base metals projects around the world,
it was generally thought they had little interest in picking up gold projects.


Think again. A very reliable source close to several gold companies tells
us Chinese interests are not only taking stakes in explorers and miners,
they are also buying gold directly from producers and shipping it home.

There is much talk in gold bug circles in the US that the recent purchase
by the Bank of International Settlements of more than 4 tonnes of gold
may have been wholly or in part on behalf of the People’s Bank of China.

Our source is quite clear on one thing: the move on NGF is just the beginning.
China wants more gold and it doesn’t want to pay full market price for it (as
it doesn’t for any mineral) so it will be looking to pick up more Australian gold
producers and add the yellow metal to its existing central bank gold pile.

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