Industry and Tech Demand for Gold Charted Healthy Increase in 2024

Fundamentally, gold is money, but it is also an extremely useful metal, especially in tech applications.

Demand for gold in industry and tech was up 7 percent in 2024, driven by growth in the electronics and computing sectors.  

Industry and technology used 326 tons of gold last year, propelled by the strongest fourth quarter since 2021.

Gold is an important input in the electronics sector. The metal is an excellent conductor, efficiently dissipates heat, and, unlike copper or silver, doesn’t oxidize or corrode over time. Gold is also extremely malleable and can easily be formed into very thin wires and sheets.

The electronics industry used 270.6 tons of gold in 2024, a 9 percent year-on-year increase.

The growth of artificial intelligence (AI) helped push overall industrial demand for gold higher. AI processors and High-performance Computing Chips (HPCs) use gold-plated receptors and bonding wires to ensure reliable connections. Gold is also used in massive AI data centers in server motherboards, connectors, and fiber-optic transceivers to maintain efficiency, reduce data transmission losses, and prevent corrosion.

After a weak 2023, the consumer electronics sector showed signs of recovery last year.

Market analysts estimate that smartphone shipments grew by 6 percent in 2024, driven by “super aggressive” growth among Chinese vendors focusing on sales of low-end devices within China and to other emerging markets. However, sales for higher-end phones that tend to contain more gold fell last year, and Apple and Samsung both reported declining market share.

On the positive side, increasing penetration of WiFi 7 into the marketplace will likely drive gold demand in the wireless sector higher in the coming quarters. WiFi 7 infrastructure requires considerably more power amplifiers than WiFi 6, and that requires more gold.

The aerospace sector also uses gold. The proliferation of satellites for communications and internet service may represent a potential long-term source of demand for gold from both printed circuit boards and wireless components.

According to the World Gold Council, further growth in demand for low-Earth-orbit satellites (LEOS), along with the corresponding upgrades needed in many ground stations, will continue to support tech demand for gold.

Global demand for gold in other industrial and decorative applications fell by 4 percent in Q4. This was chiefly driven by losses in Italy and East Asia due to slow sales of branded accessories and de-stocking by retailers.

Offsetting this decline, demand in India grew by 5 percent as high gold prices impacted the affordability of fine gold items and prompted greater demand for gold-plated articles and jewelry.

The use of gold in the dental sector continued to decline, with a 6 percent year-over-year drop in Q4.

Gold Is Far From “Useless”

Warren Buffett once said, “Gold gets dug out of the ground in Africa or someplace. Then we melt it down, dig another hole, bury it again, and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.”

You’ll sometimes hear this notion that gold is “useless” from commentators on mainstream financial networks. 

As you can see by the growing demand for gold in technology and electronics, this is just silly.

In fact, gold is one of the most useful metals in the world. Due to its utility, coupled with its scarcity, gold is also one of the most valuable metals in the world.

In the first place, gold is beautiful. That’s why people all over the world love to wear gold. About three-quarters of gold demand is for jewelry production. About 1,877 tons of gold were used in jewelry fabrication last year.

But gold isn’t just pretty. As already mentioned, the metal’s inherent physical and chemical properties make it useful in many industrial and technological applications.

This is why we see gold increasingly used in the tech sector. In fact, gold would probably be used even more if it weren’t so rare and expensive. 

Gold is also important in the medical field. Its inherent stability and unique optical properties make it perfect for use in diagnostic testing. The World Gold Council said that gold is “at the heart of the hundreds of millions of Rapid Diagnostic Tests (RDTs) that are used globally every year.

“This well-established and critically important technology has changed the face of disease diagnosis in the developing world over the last decade.”

Gold nanoparticles are used in testing for malaria, HIV, hepatitis, and other illnesses.

Gold has even been used in some exotic applications. In 2018, a team of Chinese researchers partially restored the sight of blind mice by replacing their deteriorated photoreceptors – sensory structures inside the eye that respond to light – with nano-wires made of gold and titanium.

The point is that gold is far from useless. 

But fundamentally, gold is money. And everybody wants to have money - especially real money.

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