China reports discovery of massive US$83b gold deposit in Hunan province

A number of Chinese media outlets are reporting on a massive gold discovery being made in the country’s central Hunan province.

The giant find was made by the Geological Bureau of Hunan, with more than 40 gold veins identified.

According to the bureau, the gold was found at a depth of 2,000 metres beneath the Wangu gold field in Pingjiang County.

Massive discovery

Official state media outlet Xinhua reported that the gold discovery has estimated reserves of more than 1,000 tonnes.

Chinese officials stated that the discovery – which initial estimates suggest has a value of US$83 billion – was made using new ore prospecting technologies such as 3D geological modelling.

Gold was also discovered in drilling around the site’s peripheral areas, highlighting the area’s exploration upside.

Chinese news outlet CCN noted that, while China is already the world’s largest gold producer with approximately 10% of global output in 2023, it has recently been forced to import gold to meet domestic demand.

Continued strength

The Chinese discovery news comes as gold recorded its biggest weekly gain since March.

According to senior commodity strategist Daniel Hynes, the gold price was pushed higher on the back of escalating geopolitical tensions, climbing back through US$2,700 an ounce after reports of Russia’s recent missile attack.

The market also reacted to commentary from the US Federal Reserve’s Austan Goolsbee that suggested interest rates would head markedly lower over the next year.

Record demand

The World Gold Council’s “Q3 2024 Gold Demand Trends” report revealed that total gold demand increased 5% year-on-year to a record third quarter of 1,313t.

Total demand exceeded US$100b for the first time on record, supported by strong investment in a record-high price environment.

Global investment demand more than doubled year-on-year to 364t, driven by a shift in demand for gold ETFs—which added 95t, marking the first positive quarter since Q1 2022.

Bar and coin demand fell 9%, but the year-to-date total remains strong at 859t compared to the 10-year average of 774t.