New Australian gold rush returns to historic mining towns and city streets
As record-high gold prices deliver windfall for Australia's mining sector, small investors and prospectors are also hitting pay dirt.
People queue up outside a bullion store in Sydney as gold prices hit record highs.
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AUSTRALIA: Along a winding creek in eastern Australia’s Great Dividing Range, Jhob Drinkwater bends over his pan, digging patiently into the earth.
He scoops up soil and gravel, shovelling them into his pan while sifting out the heavier rocks and pebbles.
Then, crouching by the water’s edge, he swirls the pan in gentle circles until the muddy water spills away and only a thin layer of sediment remains – and with it, hopefully, the faint glint of gold.
“As you can see, I've found a pretty nice bit of colour there. Just a good dozen little specks,” Drinkwater said, showing CNA a tiny yellow cluster – no larger than a few grains of sand pressed together at the bottom of his pan.
“I could set up camp here all day, bring the dog and a barbecue down. Maybe at the end of the day, I will have a fair bit of good gold to have in the pan and in my pocket as well.”
A GOLD REVIVAL IN HISTORIC TOWN
Drinkwater grew up with gold mining in his blood.
He hails from Hill End, a former gold mining town in New South Wales that has seen a recent surge of visitors chasing a modern-day version of the gold rush.
The great Australian gold rush began in the mid-1800s, drawing fortune seekers from around the world to hotspots across the state, including Hill End.
Nearby, the town’s cemetery still bears witness to that era – tombstones marking the thousands who once lived and died there chasing the promise of riches.
Those weathered graves tell a sobering story: of families who risked everything to find a golden nugget. Sadly, many of those dreams ended in failure.
Today, little remains of the old boomtown.
But rising gold prices have brought hopeful prospectors back, convinced there is still treasure hidden beneath its soil.
Local general store owner Jim Rutherford said the real winners are not necessarily the miners.
“The only way to guarantee success in a gold rush is to sell shovels. And the modern version of shovels is water, pans and coffee,” he told CNA.
With the latest gold fever, Rutherford’s shelves have been cleared of prospecting pans. For now, he is selling coffee and food supplies to the steady stream of newcomers.
GOLD FEVER HITS THE STREETS
Hundreds of kilometres away in Sydney’s central business district, the gold rush has taken a different form.
Outside bullion shops, queues snake down the street as investors wait hours to buy – or sell – their share of the glittering commodity.
Some dealers have extended their trading hours and brought in extra staff to cope with the surging demand.
Jewellery stores, too, are seeing a steady flow of customers eager to pick out gold pieces, despite skyrocketing prices.
“Gold never loses its prestige. People love gold because they feel safer with gold, much more than any other metal,” said Nic Cerrone, managing director of Cerrone Jewellers.
STRIKING GOLD AGAIN
Gold has climbed more than 50 per cent in value over the past year, peaking at a record above US$4,300 per ounce in October.
Economists say gold’s rally may not be over.
“The structural drivers for gold are there. Central banks are buying gold, retail investors are buying gold,” said Vasu Menon, OCBC bank’s managing director of investment strategy.
“Gold has had a huge run this year. It's taking a breather, but we don't think it's game over. After the breather, there's potential for gold to head even higher.”
He added that with United States Federal Reserve Chairman Jerome Powell stepping down next year, uncertainty could spur more investors towards the safe-haven asset.
“The markets are going to worry about Fed independence once again. That could prove to be a tailwind for gold,” he told CNA’s Asia First programme.
In Hill End, Drinkwater remains confident that plenty of gold still lies hidden beneath Australia’s soil.
When he is not prospecting, he runs gold panning tours teaching newcomers the craft of uncovering the precious metal.
"Down here is a really good spot to perfect your skill,” he said. “Because if you're washing up tiny specks … then when you are out in the field on a good patch you're going to wash up some really good gold.”
