Asian gold producers hoard domestic supplies amid dollar concerns

Countries across Asia are intensifying efforts to retain more value from the recent surge in gold prices. This involves boosting domestic refining of gold produced from their own mines and implementing measures such as taxes or central bank purchases to discourage exports. These actions are partly fueled by declining confidence in the U.S. dollar as the global reserve currency and apprehension regarding international sanctions.

According to the World Gold Council (WGC), global mined gold production reached a record high of 3,672 tons in 2025, with a modest year-on-year increase of 1%. The WGC anticipates a mild increase in mined gold production for 2026 as operations resume at two major mines. However, the WGC also notes that most major gold mining companies forecast production declines in 2026 compared to 2025, citing natural depletion of current reserves, which could accelerate if gold prices continue to rise.

The WGC addresses investor concerns about a potential structural shortage of mineable gold, the timing of a supply response, and the possibility of price manipulation. They assert that a significant shortage of overall gold supply is unlikely because mined gold is not the sole source; recycled gold from above-ground stocks, estimated at 219,891 tons, is highly responsive to price increases. Furthermore, estimates for gold reserves range from 54,770 tons (Metals Focus) to 64,000 tons (USGS), with total resources estimated at 132,110 tons. The WGC explains that estimates of below-ground reserves have remained stable for decades due to factors like lower-grade deposits becoming economically viable at higher prices, ongoing exploration, and the discovery of smaller, supplementary deposits near existing mines.