Gold traders post high profit on jewelry export

Despite the quiet local gold market in the first months of the year, gold companies still reported high profit due to surging jewelry exports.

Despite the quiet local gold market in the first months of the year, gold companies still reported high profit due to surging jewelry exports.

Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewelry Co. (PNJ), said that the company did not expect a good business result in the first half this year due to the gloomy global outlook while goldsmiths from Thailand and China had much more advantages than Vietnam’s.

However, Cuc said jewelry export revenue of PNJ in the first half this year attained US$19 million, making up 30% of the company’s turnover and increasing 64% from the same period last year. The high revenue was because the local gold price was lower than the global gold price in May and June.

Nguyen Ngoc Que Chi, general director of Sacombank Jewelry Co. (SBJ), said that due to the difference between global and local gold prices in May and June, SBJ boosted jewelry export and posted high profit in the second quarter this year. Export revenue and profit of the company in the second quarter were three times higher than the same period last year, Chi added.

She also said that if the State Bank of Vietnam permitted the company to import gold at that time, its profit would have been much better now.

Besides export, the local sale of gold companies was also better in the first half this year. PNJ’s jewelry sale in the first six months this year grew by 37% from the same period last year, Cuc from PNJ said. Meanwhile, Sacombank Jewelry Co. obtained a high revenue from jewelry items with precious stones.

However, gold companies do not pin high hope in jewelry export in rest of the year.

Chi from Sacombank Jewelry Co. said that the company could only boost exports if local gold prices remain lower than global prices. Otherwise, jewelry companies will face difficulties.

Sharing Chi’s view, Cuc from PNJ said that it was hard to expect a good export revenue in the coming months as gold prices had changed unfavorably. At this time, PNJ and others are facing difficulties as the local gold price is higher than the global price, Cuc said.

Tran Thi Ngoc Suong, head of jewelry sale division of Saigon Jewelry Holding Co., expected that local buying demand on jewelry would increase only slightly in the rest of the year as the gold price is expected to continue the uptrend. – Saigon Times

Tags: vietnam gold, Vietnam gold market