German gold retailers are reporting a rising number of customers selling their gold. Gold comes back from weak hands. A bullish sign?
“Since about six months we have been noticing higher metal back flow from consumers and retail shops. Occasionally our purchases are higher than our sales”, Andreas Heubach, managing director of Nuremberg-based merchant Heubach Edelmetalle, told Goldreporter. “Many gold investors have the jitters. Politicians have done a good job”, he says.
Confirmation comes from two of Germanys biggest precious metal retailers, Pro Aurum und Degussa Goldhandel GmbH. “Earlier we accounted nine buyers out of ten costumers. Within the last six month this ratio has changed. Now 30 percent of our customers are sellers”, Pro Aurum spokesman Benjamin Summa is tellingGoldreporter.
Wolfgang Wrzesniok-Roßbach, managing director at Degussa Goldhandel is experiencing similar customer behaviour: “During the top months last year we had a ratio of 1:10, currently it is more like 1:3 to 1.5″. He is refering to sellers versus buyers. But he stresses, this does not ultimately have to represent a fading interest by gold investors. “Obviously there is a rising number of customers selling scrap gold. On the other hand, we might also grab more market share.” Degussa Goldhandel reported revenue of 1,2 Billion Euro for 2013. This includes sales of UK-based trading house Sharps Pixley, Degussa took over in November 2013.
German gold demand peaked in Q4 2008 with 71 tonnes and in Q3 2011 with 59,3 tonnes worth $ 3,24 Billion according to figures by Thomson Reuters GFMS / World Gold Council. At that time (Q3 2011) Germany ranked number 3 worldwide after India (203,3 t) and China (200,7 t) in terms of gold bar and gold coin investment demand. In Q4 2013 germany gold demand went down to 27,4 tonnes worth $ 1,12 Billion.