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APPMC: Market Updates

By SBMA

Published on June 10, 2021
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The pandemic has mainstreamed the role and relevance of gold, particularly in the Asia Pacific context, but on-the-ground reporting and insights have proven difficult to gather, especially amid lockdowns and border closures.

Sessions on Day 1 of the Virtual Asia Pacific Precious Metals Conference gave participants an in-depth look into how the gold and precious metals industry has fared, and how it is evolving in Asean, the fastest growing regional market in the world, as well as India, the world’s second-largest consumer market for the precious metal.

India

New opportunities abound with the establishment of the International Bullion Exchange, which is located in the International Financial Services Centre in Gujarat International Finance Tec-City and became fully operational in July 2020 (fig. 1 & 2). Manoj Kumar, Executive Director, International Financial Services Centres Authority (IFSCA), noted the country’s world-class regulatory environment and focus on ease of doing business, and the unique opportunity for global bullion banks, refiners and other market participants to participant and grow India bullion market, particularly in terms of establishing standards and benchmarked products. He also highlighted the demand for a refiner and the implementation of a well-developed and renown refining framework/system.

Fig. 1 & Fig. 2

Source: IFSCA

Kumar noted that Indian households have stocked up to 25,000 tonnes of gold, the largest in the world, and that the country is the world’s second-largest importer of gold, with a demand of nearly 1,000 tonnes. In 2020, about 5,093 tonnes of gold were traded in the futures exchanges in India. As such, the time has come for India to think of how to liberate its passion for gold towards better standards around the International Bullion Exchange, he said.

Indonesia

Indonesia, Asean’s largest domestic market, is embarking on a journey to streamline its gold sector, and it expects to have a full-fledged bullion bank by 2024, Dr Adi Budiarso, Head of the Center for Financial Sector Policy at the Fiscal Policy Agency of the Ministry of Finance, Government of Indonesia, said. The country has potential gold ore resources of 14.95 billion tonnes, and it can develop a bigger bullion market share for both the domestic and global market. The initiative is still in its early days – the bullion bank implementation will start with a pilot project at a commercial bank, while a revision of the Banking Law and the Financial Service Authority (OJK) law are needed, along with a more streamlined tax exemption structure (fig. 3).

Most of Indonesia’s domestic gold production is for export, and the country still imports gold bullion to meet the needs of its jewellery industry. At the same time, gold futures trading in Indonesia has started to develop. In terms of business prospects, gold investment in Indonesia is dominated by baby boomers, though there is large potential to grow its interest among the millennial generation, which is increasingly receptive to gold consumption and investment, Dr Budiarso said.

Malaysia

Gold consumption in Malaysia was hit by the movement control order, implemented to control the coronavirus outbreak in the country. Jewllery shops and manufacturers had to remain closed during this time, but despite the poor economic conditions and high gold prices, there was little panic selling, Ermin Siow, Advisor, Federation of Goldsmiths and Jewellers Association Malaysia (FGJAM), said. He noted brisk sales among gold retailers due to government subsidies and aids, which brought a lot of liquidity to the market. In fact, listed companies Poh Kong and Tomei – the two largest in the gold jewellery sector – announced strong earnings. There has been no significant sellback of scrap gold, and local scrap is estimated 15 tonnes per year, from the country’s 4,000+ retail outlets, 1,000 sharia-compliant Al-Rahnu pawnshops, and 800 traditional Chinese pawnshops.

Fig. 3

  • In the first five years, the focus is on the Universal Bank concept by determining one or two commercial banks to act as bullion banks.
  • Then, adopting the concept of commodity trading with the regulators (FSA and Bappebti)
  • Next, preparing bullion bank as an expansion of the commercial bank business which requires industry preparation and its supervisory mechanism by the OJK (regulated in PP/POJK).
  • Finally, preparing for the potential expansion of the derivatives business which requires the strengthening the role of the capital market and derivatives market supervisor, especially in paper gold and other derivative transactions (regulated in P-OJK/P-Bappebti).
Source: Center for Financial Sector Policy, Indonesia

However, unlike retail sales, gold exports were badly hit. Gold exports in 2020 fell by about 70% to 13.5 tonnes from the year before (32 tonnes), due to border controls and a boom in domestic sales, which saw manufacturers and exporters focusing on the domestic market. At the same time, online sales of gold jewellery have been growing, so sales have not been too badly affected by the MCO. To overcome the lockdown, many retailers have switched to online sales, including live sales on social media platforms, Siow said, noting his optimism that things will turn around by the end of the year.

Vietnam

The past year has been a tough one for Vietnam’s gold industry, Le Tri Thong, CEO, Vice Chairman of the BOD PNJ Jewellery Group, reported. Even media outlets and the public have been asking if the industry is reaching its sunset days, Le said. Hit by Covid-19, total retail consumption in the country is shrinking and the jewellery market shrinking even faster as many jewellery companies have closed or suspended their operations, which has had a knock-on effect as many workers have left the jobs or the industry as a whole (fig. 4). The retail market started off 2020 well, but experienced a sharp decline of about 60% due to a lockdown in March and April, according to market data from PNJ and official statistics in Vietnam. The industry only saw a return to growth in the fourth quarter of 2020.

Fig. 4

  • The total retail consumption is shrinking
  • The “3 set of the Covid Match”
    • Market get worse in the 2nd set
    • Restart the match? – anytime?
  • Jewelry market – shrinking even faster
    • Many jewelry companies closed or suspended
    • Many workers left jobs / industry
Source: PNJ Jewellery Group
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Singapore Bullion Market Association Secretariat-Lee-Jia-Yi

Lee Jia Yi

OPERATIONS & ADMIN EXECUTIVE
Before joining SBMA, Jia Yi worked as an Admin & Reporting Officer in her previous role. She holds a Diploma in Business & Social Enterprise from Ngee Ann Polytechnic. Jia Yi is responsible for managing and maintaining physical and digital files in SBMA, supporting invoicing processes, reconciling receivables and payables, coordinating meetings and conferences. Additionally, she will provide support to the team and assist the Business Director in managing the Association’s office operations and general administrative activities.

SECRETARIAT SBMA-Emily-Oh

Emily Oh

OPERATIONS & ADMIN EXECUTIVE
Emily Oh is the Operations & Admin Executive, a seasoned professional who values teamwork and effective communication. She is skilled at adapting to new challenges and takes a proactive and resourceful approach to every task. Before joining SBMA, Emily had experience coordinating international travel arrangements and spearheading community initiatives. Her role at SBMA will be providing operational and administrative support for projects and other matters to the team.

SECRETARIAT SBMA Clara-Chang

Clara Chang

MARKETING & COMMUNICATIONS EXECUTIVE
Clara Chang joins SBMA as the Marketing & Communications Executive, enriching the team with her extensive experience in content creation, social media management, and digital marketing. Prior to joining SBMA, Clara held the position of Marketing Executive at her previous job. She holds two bachelor’s degrees from the University at Buffalo, one in International Trade and another in Geographical Information Science. Her core duties will include maintaining the SBMA website, managing the quarterly Crucible newsletter, among other responsibilities.

SBMA Committee-Photo-john-levin

Mr John Levin

Global Metals
TD Securities
John Levin is the Head of Metal Sales & Trading – APAC at the Toronto Dominion Bank’s Singapore office. Prior to this role, he devoted seven years to leading precious metal sales for the ANZ banking group in his home country, Australia. Notably, from 2009 to 2011, John played a significant role on the management committee of the London Bullion Market Association while serving as the Head of Precious Metals Sales for HSBC Global Banking and Markets in the UK.

SBMA Secretariat-Fabian-Lew

Fabian Lew

MARKETING & COMMUNICATIONS OFFICER

Fabian was a Business Development and Marketing Associate before joining SBMA. He graduated from Singapore Management University with a Bachelor’s degree in Economics.

He has joined SBMA since February, 2022.

SBMA-margare-secretariat

Margaret Wong

BUSINESS DIRECTOR

Margaret Wong, Business Director at SBMA (Singapore Bullion Market Association), brought valuable experience from her previous role at the World Gold Council (WGC). Her tenure at WGC provided her with extensive exposure to the gold community in Singapore and the broader region. This background has been instrumental in establishing strong working relationships within the industry.

Margaret’s role at SBMA encompasses a diverse range of responsibilities. She oversees office management, business support processes, finance, and administrative functions essential for the smooth operation of the team and management committee. Additionally, Margaret handles membership matters, member communications, and addresses public inquiries related to SBMA.

One of Margaret’s key responsibilities is coordinating with the Event Management Company for SBMA’s prestigious annual event, the Asia Pacific Precious Metals Conference. This flagship conference plays a crucial role in the industry, making her involvement pivotal in its success.

Described as resourceful and self-motivated, Margaret Wong brings a wealth of skills and experience to her role at SBMA, ensuring efficient operations and effective engagement within the precious metals community in Singapore and beyond.

SBMA-Albert-secretariat

Albert Cheng

Chief Executive Officer

Albert Cheng joined the World Gold Council in March 1993 as a Regional Manager, becoming Managing Director, Far East in 2003. He retired at the end of March 2015 and was subsequently named its Advisor. He has also been an International Advisor to the Shanghai Gold Exchange since 2002.

His marketing career began with Dentsu Young & Rubicam, Hong Kong in the early 80’s. He began gold marketing in July 1985 when he joined the Royal Canadian Mint as a Regional Manager for Southeast Asia.

He was appointed honorary CEO of SBMA in November 2015. He is responsible for the success and strategic development of SBMA, represents the interests of the Association, and is responsible for all the legal and regulatory aspects of the work of the Association. He is the primary contact for regulators and government bodies on bullion market development.

Ms Pawan Nawawattanasub

Ms Pawan Nawawattanasub

CEO
YLG Bullion Singapore Pte Ltd

Pawan is the CEO of YLG Bullion Singapore and founder of YLG Bullion International. She has almost 40 years of experience in the jewellery industry and established YLG in Thailand in 2003. In 2012, she brought YLG to Singapore. She sits on the Board of Directors of the Thailand Gold Traders Association, the Thailand Futures Exchange’s Arbitration Committee, and the Rotary Bangkok committee. She holds a master’s degree in Political Science.

SBMA-Shaokai-Fan

Mr Shaokai Fan

Head of Asia-Pacific (ex China) and Global Head of Central Banks
World Gold Council
Shaokai Fan is the Global Head of Central Banks at the World Gold Council, responsible for advising governments on gold matters, and enhancing the gold market through engagement, dialogue, and thought leadership. He works directly with central banks and sovereign wealth funds on investment considerations. Prior to this position, Shaokai held multiple roles at Standard Chartered Bank, including Director for Asia Strategic Initiatives and Associate-Director for Public Sector coverage. Shaokai holds a Masters of Public Administration from Columbia University and the London School of Economics, and an undergraduate degree in finance and economics from New York University.

SBMA-Committee-Alan-Liew

Mr Alan Liew

Head of Bullion & Commodities Trading
United Overseas Bank Limited
Alan is Head of Bullion and Commodities Trading for Group Trading in Global Markets, United Overseas Bank (UOB). Alan joined UOB and started the bank’s commodities trading business in 2014, previously he spent eight years in Standard Chartered Bank (SCB) trading both precious and base metals. During his tenure at SCB, he obtained the SGE gold trader licence and was part of the pioneering team for the SGE business and the FX quantitative trading team. Prior to trading, he worked for Monetary Authority of Singapore in the Financial Risk Management Division. He holds a BSc (Hon) in Computer Science at National University of Singapore and a MSc in Financial Engineering at Nanyang Technological University.

SBMA-Committee-Nikos

Mr Nikos Kavalis

Managing Director
Metals Focus Singapore Pte Ltd
Nikos Kavalis is a founding partner of Metals Focus. He has over 20 years of experience in precious metals, having previously worked for the Royal Bank of Scotland and GFMS. Since September 2019, Nikos has been based in Singapore, where he also runs the local subsidiary of Metals Focus.

SBMA-Committee-khun nuttapong

Mr Nuttapong Hirunyasiri

CEO
MTS Gold Global Trading Pte Ltd
Nuttapong Hirunyasiri is the CEO of MTS Gold Group, one of Thailand’s top 10 companies and top 3 bullion companies. He started MTS Gold Group’s first overseas office in Singapore and has been expanding the group business internationally. He focuses on product development and innovation for gold investment, with the aim of being a leader in providing the full suite of gold investment services in the ASEAN region.

SBMA Committee-Photo-Raman-Walia

Mr Raman Walia

Executive Director, Head of Commodities Sales – APAC
JP Morgan Chase Bank N.A.

Raman is Executive Director and Head of Commodities Sales, APAC, for J.P. Morgan. He joined JPMorgan in 2008 in New York, moved to Singapore in 2011, and helped expand the precious metals business in the region. Raman has an MBA from Cornell University, and likes to travel in his spare time.

SBMA Committee-Photo-Andrew-Clarke

Mr Andrew Clarke

Head of Brink’s Global Services
Brink’s Global Services Pte Ltd

Andrew Clarke is the Head of BGS (Brink’s Global Services) for Singapore, Indonesia, Malaysia and Brunei. He has held various leadership positions throughout his career in secure logistics and risk management with Brink’s, which started in Hong Kong in 2010. Andrew relocated to Singapore in 2018 to expand the precious metals line of business along with Brink’s portfolio of services and industries.

SBMA Committee-Photo-Kazuya-Naoki

Mr Kazuya Naoki

Head of Metals, Asia
ICBC Standard Bank Plc, Singapore Branch

Kazuya (Kaz) Naoki is the Head of Metals, Asia of ICBC Standard Bank in Singapore and is responsible for the precious & base metals sales and trading in the region. He joined Standard Bank Plc Tokyo Branch in 2008 and was relocated to its Singapore Branch in 2013 whose controlling stake was acquired by the Industrial and Commercial Bank of China in 2015. Prior to joining Standard Bank, Kaz spent 11 years focusing on commodity trading and risk management with Mitsui & Co in Tokyo, Sydney and London. Kaz has been serving on the SBMA Management Committee since 2016.

SBMA Committee-Photo-Vinh-Nguyen

Mr Vinh Nguyen

Head of Precious Metals, Asia
StoneX APAC Pte Ltd

Vinh Nguyen joined StoneX Group in Singapore at the beginning of 2008 and responsible for its APAC precious metals activities since 2019 until now.

SBMA Committee-KL-Yap

Mr KL Yap

General Manager, Singapore Refining Business Unit
Metalor Technologies (Singapore) Pte Ltd
KL YAP is the General Manager of Metalor Technologies (Singapore) Pte Ltd’s Singapore Refining Business Unit. He joined Metalor in 2013, initially in Refining Sales. In 2014, he became Refining Business Unit Manager, leading the development of a new precious metal refinery. KL was Vice Chairman of SBMA from 2017 to 2021, now serving as Chairman. With a degree in business commerce, finance, and marketing, he brings prior experience from refinery and heavy industries.