Who Are the World's Gold Buyers?

In the past couple of years not only has the price of gold risen substantially but the actual demographic of who the world's gold buyers are has also shifted rather substantially. Government and banking institutions are historically the gold buyers of the world. However, they have always been joined by private individuals from countries such as the US and the UK. During times of war and upheaval gold is easy to transport and takes up less space than paper money of the equivalent value. Therefore, people with money have often invested heavily in stocks of gold, both in coins and the bar form.

As the global economy has shifted seismically with the Global Financial Crisis so has the make-up of gold buyers. In 2011 China took over from India as the world's number one gold buyer. Together, China and India account for 50% of the world's purchase of gold. In the first quarter of 2011 Chinese gold buyers purchased 93.5 tons of gold. Bear in mind that China only produced a fraction of what they consumed in gold in 2010 and therefore it is easy to understand the shortfall within the country to cater for this growing demand.

Yet, only small fractions of the population within China are gold buyers at this moment in time. The number of private individuals who are millionaires is growing rapidly in China and with this growth so too it is estimated that the number of gold buyers will increase. Not only are millionaires becoming investment savvy in regards to gold but so too are the growing middle class within China.

China is a nation that values savings and gold is considered a safe form of investment over the stock market. This means an increased demand for gold which will mean a continuous increase in price. At present it is very close to the $2000 per ounce mark. To break this would mark a watershed for the price of gold. However, it was not that long ago that people spoke about whether or not the gold price would break through the $1000 per ounce mark. Not only did it do so but it has almost doubled since then.

For China, buying gold is a new phenomenon. Between 1950 and 2003 the Chinese were banned from owning gold as part of Mao Tse Tung's government. Regulations have now been lifted and the effect that this will have on the demand for gold and the emergence of a group of gold buyers is only beginning to become obvious.

China is not the only country that has been associated with gold buyers in more recent times. The Middle East has also had an insatiable appetite for gold and places such as Dubai and Abu Dhabi are home to massive souks and markets that are full of gold jewelry. Such is the demand for gold in the Middle East that there are now daily flights between many African gold mining countries and Dubai to get the gold dust straight to the refinery to quench the insatiable thirst for gold.

The face of gold buyers in countries such as the UK and the USA has also changed. Nowadays when you think of gold buyers in these countries you think of the new breed of company which has sprung up to buy old gold jewelry to be melted down and to subsequently feed demand for gold elsewhere in the world. These new gold buyers are on every high street corner and also online trying to take advantage of the current high price of gold.

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