3. Gold

Before we begin, here is a snapshot of Gold prices

The first chart hypothesizes that there are 31 year cycles in gold prices. The second chart shows price rise since 1960s. 

And the third chart shows the price rise over the last year(!) - From USD 2000 to USD 3101 (as on April 1, 2025) for per troy ounce. (1 troy ounce is 

The above prices are for 1 troy ounce of Gold. As for a little further context on troy ounce:

Precious metals are measured in troy ounces due to historical and practical considerations that have endured for centuries. The troy ounce system has its roots in the medieval trading practices of the 19th-century gold and silver merchants in Troyes, France, which became a prominent trading center. The system eventually spread throughout Europe and gained acceptance in international trade.

Unlike the avoirdupois ounce, which is commonly used in everyday commodities like food and is based on a pound of 16 ounces, the troy ounce system is distinct. One troy pound comprises 12 troy ounces, emphasizing a division based on the duodecimal system rather than the more common decimal system. This distinction is crucial in the context of precious metals because it provides consistency in measuring their weight across different commodities.

The troy ounce system's enduring use in the precious metals market is also attributed to its application in coinage. Throughout history, coins were often minted with a specific weight of precious metal, and the troy ounce provided a standardized unit for this purpose. The system is particularly prevalent in the gold and silver markets, where precise measurements are essential for determining the value of these precious metals.

Moreover, the troy ounce has become a standard in the commodities and financial markets. Precious metals, such as gold, silver, platinum, and palladium, are globally traded commodities, and the uniformity provided by the troy ounce simplifies transactions and ensures consistency in pricing.

1 US troy ounce = 31.103 grams.

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Gold Production - per annum

The world consumes ~5000 tonnes (4974, a high in 2024, driven by central bank purchases and investments) of Gold per annum. Of this, ~3300 metric tonnes was freshly minted is freshly produced, rest is recycled.

The global mine production of gold has steadily increased following the 2008 economic crisis. In 2010, gold mine production worldwide totaled 2,560 metric tons, and it has surpassed 3,000 metric tons in each year since 2015. China is currently leading the global gold mining countries, with an estimated 380 metric tons produced in 2024, while Russia came in a close second, producing about 310 metric tons in the same year. 

Here is a visual understanding of all the gold mined in last 200 years - which accounts for 85% of gold ever mined. (this fact is astounding. The high consumption, industrialisation, this big big growth and change in the world. Gold has been one of the traditional spaces - mined for a long long long time in history. But just consider this to see the world as it has mined itself out over the last 200 years).

At the moment, China is the largest producer of Gold, with around 10% of world's gold production per annum from China.

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Total Stock of Gold

Gold mining dates back to ancient civilisations. Our best estimates suggest that around 216,265 tonnes of gold have been mined throughout history. Interestingly, about two-thirds of this gold has been extracted since 1950. This massive increase in production has been due to advancements in mining technology and the discovery of new gold deposits.

To put the total amount of mined gold into perspective, if we were to gather all of this gold into a single cube, it would measure approximately 22 metres on each side. That's a surprisingly small volume for such a valuable and historically significant metal. And since gold is virtually indestructible, meaning almost all the gold ever mined still exists in some form.

Total above-ground stock (end-2024): 216,265 tonnes

• Jewellery ~97,149t, 45%
• Bars and coins (including gold backed ETFs) ~48,634t, 22%
• Central banks ~37,755t, 17%
• Other ~32,727t, 15%
• Reserves ~54,770t*Reserves are the portion of an ore deposit that can be economically extracted.
• Resources ~ 132,110t*Resources are the portion of a deposit in which companies have less geological knowledge and confidence in– it’s a broad category ranging from inferred, indicated to measured.

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Central Bank Reserves

In terms of Gold holdings by different central banks, US holds the highest at 8,133 tonnes, followed by Germany at 3,351 tonnes and Italy at 2,451 tonnes, France at 2,437 tonnes and China at 2,279 tonnes.

Although, just for context, China holds the highest reserves in the world, to the tune of $3.4 trillion, followed by Japan at $1.2 trillion and US at $0.9 trillion. This includes FX reserves and Gold reserves.

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Consumption:

Some of the largest consumer countries are:

• China ~984 tonnes of gold annually. For industry, investing and jewlery
• India ~849 tonnes annual. Major use is jewllery and storehouse of value.
• United States - 193 tonnes annual. Industrial, Investment and Jewlwery
• Germany 124 mteric tonnes. Mainly industrial
• Thailand 90 metric tonnes - jelwery mainly.

"The jewelry industry has the largest overall demand for gold of any sector worldwide that uses it by far, with a demand of some 2,168 metric tons of gold in 2023"

Some estimates put it at 78% of new and recycled gold for jewlery purposes.

Industrial uses of Gold - Conductor of electricity, malleability,  Electronic devices, dentistry, glass making, aerospace, medical uses.

A small amount of gold is used in almost every sophisticated electronic device.