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Demand for gold temporarily affected by lower commodity prices in Malaysia

--Datuk Ng Yih Pyng, Tomei Consolidated Bhd

Datuk Ng Yih Pyng shared his view on Malaysian Gold Market during APPMC 2019 with Bullion Bulletin. Excerpts of the interview are given below.

Share some insights on Malaysia Gold jewelry market? What is the customer preference, is it 9k, 14k, 18k, 22k or 24k?

Malaysia traditionally is a 22k market. Our market also sells 9k, 14k, 18k and 24k, but the main market is of 22K.

How is the demand for gold jewelry in rural vs urban regions? Is the demand specific to some regions?

According to me, the demand is balanced across, whether its rural or urban. For the urban customer, the preference is gem and jewelry, but the rural market prefers to keep Gold in form of bars.

Are the millennials attracted to Gold and Gold Jewelry in Malaysia?

Yes, they are attracted to gold jewelry because of the designs available in all ranges. Millennials in Malaysia prefer lower carat Gold, mostly 9, 14 or18k.

In Malaysia there is no GST and no customs duty on Gold jewelry. Has it increased the foreign jeweler’s presence in the market and increased the competition?

The competition has increased over time, with the presence of more overseas jewelers. In fact, some of the local jewelers are not making much profit, in spite of demolishing of GST. It is mainly because of the slowing economic growth in Malaysia due to drop in prices of main produce such as palm oil and rubber.

Malaysian economy depends on commodity price. There are more than 300,000 palm oil plantation owners in Malaysia. With lower palm oil or rubber price, it has effected the purchasing power. So even after abolishing of GST, the market has not been very interesting. 

 

Disclaimer: Views are personal and not the views of the publisher.