Gold prices hit an all-time high in June, reaching £62,022.60 per kilogram, as geopolitical tensions rise and economic conditions remain uncertain. The news has sparked concerns about what will happen when mines run out of this finite resource.
Experts estimate that we could run out of gold to mine as soon as 2050. With around 240,000 tonnes of gold mined in total and an estimated 50,000 tonnes of reserves left underground, the annual production rate of new gold is around 3,000 tonnes per year – making the 2050 figure seem realistic.
While it’s impossible for us to completely run out of gold due to recycling, there would still be major global consequences. As the supply dwindles, the price of gold is likely to skyrocket, leading investors to turn to other precious metals like silver, platinum, and palladium.
The scarcity of gold may not directly affect global currencies, as most are no longer tied to gold reserves. However, it could impact investor confidence and the stability of economies with significant gold reserves.
Institutions like the Bank of England and Fort Knox hold substantial gold reserves, and if prices rise significantly, they may consider liquidating some holdings. This could lead to changes in ownership but would still require secure storage services.
The jewellery industry would see a substantial increase in the cost of gold items, potentially decreasing demand as consumers seek more affordable alternatives. Gold is also critical for industries like electronics and medical devices, and a shortage could lead to supply chain disruptions and increased costs for manufacturers.
As gold is a crucial commodity, significant price fluctuations could impact the global economy. The industry is taking steps to prepare for potential shortages, including exploring new mining sites, recovering gold from unconventional sources, and improving recycling technologies.
While the prospect of running out of gold may seem daunting, ongoing research and advancements in technology could help ensure a continued supply of this precious metal for years to come.