Gold, the world's most precious metal
Gold has been regarded as a precious metal through all recorded history. At the end of 2017, the World Gold Council estimated that there were 187,200 tonnes of above ground gold stock, with a staggering value of $8.9 trillion!
Gold was used for coins up until the 1930s, but since then it has predominantly been used for jewellery, investments and industrial usage. While the jewellery and investment use of gold tends be well documented, its industrial uses are less well-known.
Its most common industrial use is its fabrication to produce corrosion-free electrical connectors and cables for computers and other devices. For example, did you know the average mobile phone contains 50 mg of such gold and that there are over 1 billion mobile phones produced globally each year?
Gold alloys are also used in dental work, especially for restoring teeth via crowns and bridges.
The world’s biggest gold producers
China, Australia and Russia are the three largest gold producers in the world, followed by the United States. Australia’s largest producing gold mining company is Newcrest Mining. It has mines in the Cadia Valley in New South Wales and in Telfer in the Pilbara region of Western Australia, as well as operations in Papua New Guinea, Indonesia and the Ivory Coast.
Gold is Australia’s third-largest export earner. It is mined in all Australian States and Territories, but almost 69% of all Australian gold comes from Western Australia. The Minerals Council of Australia’s latest report estimates that at current production rates, Australia’s known gold reserves could be mined for the next 36 years. That timeframe will increase with any new discoveries. Mining companies continue to invest heavily in exploration projects across the country.
The largest nugget of gold that’s ever been found in Australia was discovered in 1858 in Victoria. It weighed 70 kilograms and today would have a street value of US$3.5 million. It was found at the base of a tree, just a few centimeters below the surface!
The world’s biggest holders of gold
Central banks around the world buy and store gold as an investment. The United States has by far the biggest gold holdings. Most of it is held at the famous Fort Knox in Kentucky. Other countries with significant gold reserves include Germany, Italy, France and China.
Fort Knox in Kentucky
Significantly, since 2010, central banks around the world have changed from being net sellers of gold to net buyers. Many analysts believe that this is a security measure after the currency devaluations that occurred during the global financial crisis.