Not allowed to make bullion gold, businesses make gold rings

VietNamNet Bridge – The owners of well-known gold brands, who have been prohibited to make bullion gold, have shifted to make 9999 jewelry gold as a reaction to the new policy which says the state holds the monopoly in making bullion gold.

The Saigon Jewelry Company (SJC) has marketed ring gold bearing SJC brand. The Phu Nhuan Jewelry Company (PNJ), DOJI and many other private gold shops have also developed their own ring gold brands.

Ring gold hit the shelves

The visitors at the wholesale jewelry center located at the SJC’s headquarter would easily find the 0.1, 0.2 and 0.5 tael gold rings.

These are the gold rings, but they have all the characteristics of bullion gold, because they have the stamps of the manufacturers, brands, seals and especially, they are 9999 purified gold.

On its official website, SJC Company has updated the prices of 9999 gold rings. There are also the quoted prices for other kinds of bullion gold. The ring gold price is now 2 million dong per tael cheaper than bullion gold, but there exists a big gap between the sale and the purchase prices.

“We have decided to market ring gold in order to satisfy the market demand after we realized that a lot of buyers demand these products,” said a senior executive of SJC.

PNJ has been advertising its ring gold brand in Mekong Delta provinces. The gap between the PNJ bullion gold and 9999 ring gold prices has been widened from 930,000 dong per tael to 2 million dong per tael.

Nguyen Ngoc Trong, Business Director of PNJ, has admitted that the sales of ring gold have been going very slowly with less than one tael sold a day.

This has been explained by the fact that it’s simple to make ring gold which can be done by any goldsmith. Therefore, gold shops would not buy gold rings from big companies.

He also said that the gold shops have loyal clients in their localities, who like buying ring gold which they can hoard up as their assets and can wear as jewelries as well.

Meanwhile, the demand for ring gold in HCM City is not high, because the people here have the habit of keeping bullion gold instead of jewelries.

Meanwhile, the director of a goldsmith company has noted that the demand for ring gold has increased because of the too big gap between the bullion and ring gold prices which has prompted people to convert bullion into ring gold. They hope to make profit later when the gap is narrowed .

Ring gold can’t replace bullion gold

Goldsmith companies rush to market their ring gold brands because they consider this the best solution for them to continue business after the State Bank of Vietnam prohibited them to make bullion gold.

The companies believe that once the bullion gold brands do not exist anymore, people would buy 9999 ring gold business, i.e. the gold with high purity of gold to hoard up instead.

However, Tran Thanh Hai, General Director of VGB, believes that ring gold would not be the other alternative for people. Firstly, ring gold has rough shape, which makes it inconvenient to carry. Meanwhile, it’s easy to buy bullion gold in big quantities to hoard up, carry and store.

Secondly, the quality of ring gold is worse than bullion gold. Rings have been manipulated manually, while every gold shop has its own brand and sets up its quality standards, while there has been no common national standard.

Vietnam; bullion gold; gold market management; ring