With gold supply falling rapidly in 2014 at the rate of 2%, gold recycling levels have fallen to their lowest levels in the past 7 years. In 2013, a fall of 11% was noticed in gold recycling.
What does this imply?
According to World Gold Council, Gold Demand Trend Report 2014, gold recycling is supposed to remain low and will continue to fall as a result of recent surges in gold prices in China and India. In other words, as gold recycling contributes greatly towards the significant percentage of gold supply, the increase in demand flushing out gold supply will be channeled towards gold tightening and recycling. In other words, gold recycling contributes a significant section of gold supply, as with an increase in demand, channels of gold supply are getting tightened.
Gold recycling continues to be an important source of the overall supply of gold. Out of the 4278.2 tons of gold supplied in 2014, recycling of gold made up 26% at about 1172.7 tons. Recycling helps balance the gold market by taking the bite off the gold mining industry to supply gold demand to which the demand was 3923.7 tons in 2014. Additionally, with gold recycling a person also has to consider that the environmental costs fall way lower than gold mining.
In fact, an article by leading environmental protagonists’ recently stated, that an 18k ring gold mining leaves behind 20 tons of ore and rock waste.
Here are the top 4 Gold recycling countries of the world
India: Demand vs Recycle: 864.2 tons vs 113 tons
China: Demand vs Recycle: 817.5 tons vs 120 tons
United States: Demand vs Recycle: 161.8 tons vs 129 tons
Italy: Demand vs Recycle: 23.5 tons vs 123 tons
The figures clearly indicate the demand supply gap, which has to be met by a positive gold mining situation. Even though the heavy downsides to gold mining the world supply of gold still relies heavily on recycling. Considering a situation where 90% of the world’s gold is recycled, the undeniable fact is that gold owners might really not want to part off with their gold, thus, leaving absolutely no gold to be recycled. Recycling forces thus come to a sudden halt, with only incentive to drive owners being the gold prices, which once again are very much dependant on the market situations.
Nevertheless, there are opportunities that can be derived from recycle of old electronics. 10% of recycled gold supply comes from busted electronics. This is low when compared to high value gold, but has definitely grown in the last 10 years. It is subject to further growth if enough strength is put in it by gold recyclers. The world is extorting more and more simple ways to extracting and recycling gold from electric circuitry. 2015 saw 500,000 tons of industrial waste being recycled. This number is expected to touch 2,000,000 by 2025.
Overall, for gold recycling companies, whether it is high value or industrial gold, the pressures as well as opportunities is driven by time and market. The right steps taken at the right time can be the only help to the industry at this point.
What we can positively look at are avenues for industrial waste to make a positive impact in the extraction methods and thereby stem in the years to come.