Despite shutdowns, there’s enough gold refining to meet demand — LBMA
The London Bullion Market Association (LBMA) said on Friday there was more than enough gold refining capacity in the world to meet demand and that refiners, shippers and banks were working to make sure metal could be transported.
The shutdown of several major refineries and most global air travel due to the coronavirus outbreak has disrupted the gold supply chain just as demand for the metal rises. Gold is often viewed as a safe investment in times of turmoil.
Fears that gold couldn’t be flown from London to New York to settle contract obligations on Tuesday pushed prices in the two cities further apart than they have been in decades, causing chaos in trading.
“While a few refiners have suspended production as a result of covid-19, the other good delivery refiners are ready and able to accommodate the industry’s needs,” the LBMA said in a statement.
Good delivery refiners are those accredited by the LBMA and supply the vast majority of the world’s gold. There are good delivery refineries in 31 countries.
“Refiners and other market participants are actively engaged with logistics companies to overcome travel constraints and ensure the physical movement of metal via, for example, chartered or cargo flights,” the LBMA said.
(By Peter Hobson; Editing by Mark Potter)