Gold market is on edge.

An employee at an SJC gold trading establishment processes a transaction with a customer. Photo: VL

SJC gold is scarce.

For the past two weeks, Mr. Nguyen Van Phuoc (Vinh Dien ward, Dien Ban district) has traveled to Da Nang five times to buy gold but has returned empty-handed. It is known that last year, Mr. Phuoc borrowed 5 taels of SJC gold from a relative to renovate his house, and now that the repayment deadline has arrived, he needs to find and buy the exact same type of gold bars. At every SJC store he visited, they shook their heads and informed him that they were out of gold.

“The first time they said they only had plain rings and gold jewelry left, and asked me to leave my phone number so they could contact me when they had gold bars,” Mr. Phuoc recounted. After waiting a few days without receiving a call, he returned to the store but still couldn't find any, even gold rings were sold out. At all the SJC stores in Da Nang that Mr. Phuoc visited, they were all informed that they had run out of gold bars.

SJC gold is a type of gold produced by Saigon Jewelry Holding Company. SJC gold stands out from many other gold brands because it is cast in a single rectangular piece.

The surface of an SJC gold bar is imprinted with a dragon image and four nines, indicating 99.99% pure gold. The advantages of SJC gold include a diverse product range and a nationwide network of stores and dealers. Importantly, product quality is guaranteed because SJC gold bars have been selected as the State-owned gold brand.

v(1).jpg — SJC gold is a state-owned gold brand and is produced in limited quantities. Photo: VL

Since the beginning of the year, gold prices have continuously increased, but the number of people trading remains quite high. Notably, for more than a month now, SJC gold bars have suddenly become scarce, especially the 1-tael, 2-tael, and 5-tael denominations.

Mr. Nguyen Van Hung (a gold shop owner in Dien Ban) commented that the shortage of SJC gold bars is due to many reasons. Besides some investors, the factor of businesses "hoarding" goods and delaying their release to the market cannot be ignored.

"People generally think that SJC gold is more reliable in terms of quality and has a strong brand, making it easier to buy and sell, so they prefer to hold SJC gold," Mr. Hung analyzed.

Due to regulations prohibiting SJC Company from manufacturing gold bars and only allowing it to conduct trading activities, the quantity of SJC gold bars on the market is limited.

Since the end of 2023, gold prices have continuously reached record highs. While the selling price of SJC gold bars was around 76 million VND per tael during the period leading up to the Lunar New Year of the Year of the Dragon, it reached 85 million VND by April, even hitting a record high of over 92 million VND in May, and currently fluctuates around 90 million VND.

To stabilize the gold market, the State Bank of Vietnam began auctioning SJC gold bars on April 22nd. After 9 auction sessions (6 successful), more than 48,000 taels of gold bars were released into the market by the central bank.

However, the more gold was auctioned, the higher the price rose. Some argue that the high floor price in the auctions resulted in less effective price stabilization. This is also why the State Bank of Vietnam halted gold bullion auctions on May 27th.

The business of selling gold rings is difficult.

While SJC gold is scarce, other types of gold (96%, 98%, 9999 purity, collectively known as plain gold rings and jewelry) are selling quite slowly. According to inquiries at several gold shops in the province, most reported that business is not as good as last year.

Business in selling plain gold rings is slow. Photo: VL

According to Mr. Le Van Ngoc, the owner of a gold shop in Hoi An City, he sells an average of 1-1.5 taels of gold per day these days. Besides a small number of people withdrawing money from banks to buy gold for investment, most people buy gold primarily for parties, weddings, and other celebrations.

"Due to the difficult economic situation and reduced real estate transactions, people don't have the money or the need to buy or sell gold. Only in months with many weddings and engagements do sales move a little faster," Mr. Ngoc said.

In addition, the crackdown by relevant agencies on the origin of gold has also affected the gold ring business, especially with the amount of gold previously purchased from the public.

According to Mr. Nguyen Van Hung, the central government's regulations on the origin of gold have been inadequate in recent times, because not all people selling gold carry invoices and related documents, not to mention that many pieces of jewelry, gold, and silver are acquired through inheritance, gifts, or purchased decades ago...

"Of course, most of the gold we import comes from companies with clear invoices proving its origin, but there are exceptions where we buy from individuals, and not everyone has documents proving the origin. Trading was already difficult, and now it's even harder," Mr. Hung explained.

According to Mr. Luong Viet Tinh, Director of the Quang Nam Market Management Department, inspecting and verifying the origin of gold is necessary because, in reality, most gold bought and sold has markings on the product, making it possible to determine its origin.

From May 20th to 25th, the Quang Nam Market Management Department sent officials to participate in an inter-agency inspection of gold trading establishments in the province, alongside a delegation from the State Bank of Vietnam. The department is currently awaiting the report on the results.

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