How Much Gold is out There?

It has been estimated that the total amount of gold that has ever been mined is about 160,000 tonnes which would correspond to a tennis court-sized cube of gold valued at about $1.8 trillion. Almost all of this gold has been mined since the California gold rush of 1848 and about 2,500 tonnes of gold continues to be mined each year. So theoretically, all of this gold can be made available for sale tomorrow–that’s the entire supply.

About 30,000 tonnes, or about a quarter of all the gold out there, is held by the world’s central banks of which the largest holding is that of the USA with a reserve of about 8,130 tonnes. The International Monetary Fund and the central bank of Germany each hold less than half of this amount, followed by the central banks of France, Switzerland and Italy. The rest is held by private individuals in the form of jewelry, coins and bars, with the largest private gold holding being in India with about 25,000 tonnes–about double that of the total USA holdings.

Gold ‘consumption’, or how gold is used, includes production of jewelry, dental use (for crowns), medical uses, industrial uses, investment uses (as a hedge) and even actual physical consumption, ie. edible gold.

The price of gold, as of all commodities, follows a simple formula–if the demand for that commodity is greater than the supply, the price goes up and if the demand is lower than the supply, the price goes down. Several things can affect the supply and demand but obviously, a major determinant is the amount of gold that exists.

Jayan writes about yoga, nutrition and weight loss. If you liked this article, please visit Gold Mutual Funds and Gold Price Fix.