Physical demand for gold in China has skyrocketed this year after prices plunged in April and June. Experts expect upwards of 1,000 metric tons to be bought by ordinary consumers in 2013, an all-time high.

But gold consumption over 1,000 tons may be unsustainable for the long term, as analysts puzzle out what could be a "new normal" for Chinese gold consumption. An expanding Chinese middle class often buys gold for cultural and economic reasons.

“The vast majority is not counting on the same level of appetite as seen this year,” wrote UBS analyst Edel Tully in a research note on Tuesday. “Participants in China generally acknowledge that buying this year was exceptional, and is unlikely to be repeated in 2014.”

Previously, gold industry figures in China described annual consumption above 1,000 tons as unsustainable, even as one top analyst crowned China’s thirst for gold the “single most bullish factor” for the metal’s price, in a year with price declines of more than 20 percent.

Chinese consumers have soaked up about 800 tons of gold for the year to Nov. 15, according to World Gold Council statistics, beating their biggest rivals, the Indians, by just over 100 tons. UBS estimates that China imported roughly 1,500 tons of gold this year, in gross terms. The country is also the world’s top gold producer, and could produce a record 430 tons in 2013.

“As regards Chinese appetite for gold, it’s been absolutely quite exceptional,” this year, HSBC Holdings PLC (LON:HSBA) analyst James Steel told International Business Times. “Even if it moderates from current white-hot levels, it’s still almost surely going to be historically high,” next year, he added.

Usually, analysts track imports into China via Hong Kong, which ships its gold to the mainland through the nearby port metropolis of Shenzen. But some gold has also flowed directly to China through Shanghai this year, according to UBS, indicating that demand has partly overwhelmed typical customs channels.

Total gold held by Chinese households is still less than half what's held by Indian households (about 20,000 tons). So Chinese consumers still have room to increase their holdings, World Gold Council managing director Marcus Grubb told IBTimes in early November.

He said gold consumption in China for 2013 may well exceed 1,100 tons, far outstripping the previous Chinese record of 776 tons in 2012, even in a year with slower economic growth. He said Chinese consumption above 1,000 tons is sustainable and could be maintained in coming years, though much depends on prices.

Consumers in emerging markets often flock to gold when it hits bargain prices, snapping up the metal for the long term. That happened in waves this year.

Still, Chinese investors have been slow to take to gold investment products like gold exchange-traded funds. Two such gold funds that launched earlier in 2013 have met with limited interest, reported MoneyBeat. Experts say immature market infrastructure and a Chinese desire for physical gold accounts for the slow uptake.

A World Gold Council partnership with the state-owned Industrial and Commercial Bank of China, launched in December 2010, has resulted in net collected tonnage of only 63 tons, spread among 8.8 million accounts. Investment demand in India far exceeds that.

If China consistently exceeds 1,000 tons of gold consumption annually, that will beat India’s comparable all-time high of 1,006 tons in 2010. These figures refers to consumer demand, which represent sales of gold coins, bars and jewelry.

Demand for gold among speculative and more sophisticated investors, alongside central bank buying, involve other metrics. It’s unknown how much gold the Chinese central bank has bought in recent years, since it does not regularly disclose data on purchases.

Most recent data indicate Chinese central bank holdings at about 1,050 tons, the sixth-largest in the world. That’s still only 1 percent of their total holdings, partly thanks to the massive $1.2 trillion in U.S. debt the Chinese government holds.

Nick Brooks, head of research and investment for ETF Securities, suspects that the Chinese central bank has bought more gold since its last official disclosures on the topic in 2009, in a bid to diversify asset holdings.

“But it’s really impossible to know, because it’s not reported,” Brooks told IBTimes last week. The figure may land in a broad range, if Chinese total imports and domestic production are combined, with private sector demand subtracted. The government will not verify estimates, so the real figure is still a mystery.

Gold prices have marched downward this year, though traders expect support at a floor of $1,200 per ounce.