Koos Jansen
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Koos Jansen
Posted on 27 Dec 2014 by

SGE Withdrawals A Whopping 61t In Week 51, YTD 2016t

Withdrawals from the Shanghai Gold Exchange (SGE) came in very strong in week 51 at 61 tonnes, year to date the counter has reached 2016 tonnes.

Screen Shot 2014-12-27 at 12.18.55 PM
Blue (本周交割量) is weekly gold withdrawn from the vaults in Kg, green (累计交割量) is the total YTD.

Some SGE data lags one week, some not; in this post all data is up to week 51 (December 19).

Withdrawals from the vaults of the SGE captures Chinese wholesale demand, however, to get a more precise view on demand we have to add SGEI volume to the equation (read this post for a comprehensive explanation on the relationship between SGE withdrawals and volume on the Shanghai International Gold Exchange – SGEI). If we subtract SGEI volume from SGE withdrawals, at least 51 tonnes was withdrawn in week 51, at most 61 tonnes; year to date, at least 1,963 tonnes was withdrawn, at most 2,016 tonnes.

I could speculate on why Chinese wholesale gold demand is likely to be more in the area of the upper limit or bottom limit, fact is I have little evidence to back it up; all I know at this stage is that it’s somewhere in between.

Shanghai Gold Exchange SGE withdrawals delivery 2014 week 51, dips

Last week I wrote I expected withdrawals to be strong in the coming weeks, as December and January are seasonally the strongest months, but the Chinese are often aiming to buy their physical on the dips. In week 49 and 50 withdrawals were a bit held back because of the rising price of gold in renminbi. In week 51 the price was declining, so withdrawals were up.

Shanghai Gold Exchange SGE withdrawals delivery only 2014 week 51, dips

Year to date SGE withdrawals – 1963 tonnes, the bottom limit – were supplied by (my best estimates):

  • 442 tonnes mine production
  • 1,172 tonnes import
  • 349 tonnes recycled gold

If we use the upper limit – 2016 tonnes, import and/or recycled gold had to be more.

SGE premiums have been hovering in between 0.51 and 0.76 % above London spot throughout week 51.

Total SGE (gold) trading volume was down 14 % from the previous week at 410 tonnes. The uptrend is still intact as we can clearly see from the next chart.

Shanghai Gold Exchange SGE weekly gold volume

On the Shanghai Futures Exchange (SHFE) volume traded in Au futures accounted for 786 tonnes in week 51 (1,196 tonnes SGE + SHFE volume), on the COMEX 2,527 tonnes changed hands.

COMEX vs SGE + SHFE gold volume

Koos Jansen
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  • NM

    Just a matter of time before Gold goes parabolic !!!!!

  • Dave K

    Koos, Great job as always. Have you done a recent update on UK gold exports (or any other reported sources of existing stock movements) to see where all this physical might be coming from beyond production? I saw your UK numbers through 3-2014. Am I correct in assuming “reported” GLD stock mostly stabilized for 2014 while Comex is still bleeding a small bit; yes/no?? Just curious on your latest thoughts. Thanks!

  • Sabre Sbr

    All that matters is gold breaking free of the dollar trade. In time all bets will be off when the first sovereign blows sky high.

  • DameEdnasPossum

    Koos,
    You are in a class of your own. You seem to consistently provide some of the most interesting analysis on gold available…and for that you have my personal thanks.

    You da’ man!

    Just as an interesting little diversion:

    So…the equivalent of 1,220% of the quantity of bullion the Bundesbank received back from NYFRB in 2013 is withdrawn from the SGE…in 1 week.

    On an annualised basis this is approx. 635 times what Germany received back from the U.S. last year.

    Or put another way…almost twice the amount of German gold repatriated from the trusted partners at the Fed. in 2013 was withdrawn from the SGE…in a single day!

    Clearly logistics has nothing to do with the return…sorry, non-return…of Germany’s gold.

    It will be interesting to see the published figures on what Germany receives in 2014.

    To be fair, they have towed Washington’s party line on events such as MH17 being shot-down by a Ukrainian Su-25 and heavy sanctions against Russia…so they should be rewarded somehow for this subservient obedience.

    This game of smoke and mirrors is clearly not sustainable. It has a final end-point and an obvious conclusion. I simply hope that this outcome is not another hot war in Europe or Asia. As a species we should have evolved beyond such stupidity by now…however the hubris of some would suggest otherwise.

  • Ronald West

    It has to be coming from Fort Knox, and they don’t seem the least bit concerned whose gold they use to manipulate the price with, even though they hold the gold in trust for other beneficial owners, perhaps Germany?

    • brutlstrudl

      I doubt that Fort Knox has “Good for Delivery” Bars. Photo’s of the vault’s back in the 70’s show a copper burnish to the bars. Probably coin melt.

      • Ronald West

        Good point but back then (remember it’s been 60 years since anybody not involved in the scam has seen the gold), that was where most of the gold for the entire world was stored, and periodically, gold would be moved from one country’s vault to another country’s vault, to settle their balance of payments accounts. My point was that the gold that is coming out of the SGE vaults and heading eastward, was likely stored in Fort Knox at one time in the long ago past before the US egregiously squandered their fortune to manipulate gold prices with, and I am convinced that Fort Knox is now empty. For a truly mind-numbing credible revelation on this, click on:

        http://pro.sovereignsociety.com/SVS911/WSVSQ704/?h=true

        It will scare the shit out of you, I guarantee it! At one time about 85 years ago, the US had 21,500 tons of gold in Fort Knox, which, at that time, was half of the gold ever mined in all history. It is tragic that the US has squandered their entire capital in a mere 85 years. Back then, a dollar really was as good as gold. Now it’s just a piece of well used shit tickets. If this doesn’t make you want to cry, I don’t know what will.

        • brutlstrudl

          Keep stacking, dude.

          • Ronald West

            Absitively!

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