CHINA’S gold demand is expected to rise and help push the price of bullion back to about US$1,200 an ounce next year, the chairman of Zijin Mining Group, the world’s biggest gold producer by market value, said yesterday.

    “China’s government is expected to further increase gold reserves as it takes a very small portion of foreign exchange reserves, and demand from jewelry buying and manufacturing will also pick up,” Chen Jinghe said.

    However, the economic slowdown in the world’s top consumer of the metal will continue over the next two to three years that will keep the price of commodities such as gold and copper under pressure, Chen said.

    The World Gold Council expects China’s gold demand to at least hold steady this year from a year ago, at just under 1,000 tons. China consumed 973.6 tons of gold in 2014, it said.

    After a 12-year bull run, global prices of the safe haven metal, which peaked in 2011, have struggled to gain traction. It sank to US$1,077 per ounce July 24, its lowest in 5-1/2 years, and has gradually risen to about US$1,130 over the past few weeks.

    China’s gold reserves rose by nearly 610,000 troy ounces, or 19 tons, to 53.93 million troy ounces in July from June.

    Zijin Mining posted a 20.9 percent rise in its first-half net profit at 1.3 billion yuan (US$203.88 million) despite a sharp fall in gold and copper prices over the period.

    Other major gold producers posted a big fall in first-half net profit. Zhongjin Gold and Shandong Gold Mining saw their net profit drop more than 80 percent, according to their exchange filings.

    Zijin, which unveiled three acquisitions of foreign mining assets between May and June, will push ahead with mine acquisitions to expand its portfolio outside of China.

    “We are very active and we do not restrict our targets in any specific regions or assets, though we mainly look into gold and copper,” Chen said. (SD-Agencies)