Burma Gold Prices Draw Back After Volatile Month
By San Yamin Aung 2 September 2013
RANGOON — Gold prices were volatile in Burma last month, fluctuating more than in any other month so far this year, local gold dealers and shop owners say.
The lowest local gold price in August was 688,000 kyats per tical (0.576 ounces), or about US $1194 per ounce, while the highest was 730,000 kyats per tical (about $1,267 per ounce).
“Last month was the most volatile month of this year, as the price rose to its highest since late April,” Kyaw Win, the senior vice president of Myanmar Gold Development Public Co. and owner of U Htone Goldsmith Shop in Rangoon, told The Irrawaddy on Monday.
The price of gold began rising in the middle of August in Burma, with the spike to about $1,267 per ounce occurring last week on Wednesday. That mirrored a spike in the global price of gold, to $1,434 per ounce. Analysts attributed the rise to investors buying into safe-haven assets such as gold last week after the United States threatened military intervention in Syria.
The domestic gold price in Burma fell again on Monday, to 719,000 kyats per tical ($1,248 per ounce), while the global price stood at $1,390 per ounce.
Zaw Aung from Tate Sein Gold Shop in Rangoon said the local gold price was fluctuating with international prices, and added that sharp drops locally this year twice hit last year’s floor point—in late April and again in June.
Still, Kyaw Win said that despite the slight decrease early this week, the local gold price remained higher than in past months, leading to an approximate 30 percent decrease in sales rates compared with early last month.
He said there was also a drop in gold production during Burma’s rainy season—from mid-May to late October—partly because of collapse of gold mines due to heavy rains. That fall in production was balanced by lower demand for gold in the country, he added, with people more interested in selling gold products back to dealers rather than buying new ones.
He called for local control over retail gold shops.
“Businessmen from Thailand, Hong Kong, Vietnam and Japan are interested in opening gold shops in Myanmar [Burma,]” he said. “But we prefer foreign investment in gold manufacturing. Allowing foreign retail gold shops into the domestic gold market can harm individual gold shop owners.”
In Burma, gold is produced commercially in Pegu, Sagaing, Mandalay, Magway and Taninthayi divisions, as well as Kachin, Karen and Mon states.