Higher gold jewellery price likely

GEORGE TOWN: Labour charges for gold jewellery items in the country are expected to rise by 15% to 30% at end-June, depending on the design.Penang Goldsmith Association (PGA) adviser Joeson Khor said the recent implementation of minimum wages had caused labour charges to rise.

Source from (The Star Online): http://biz.thestar.com.my/news/story.asp?file=/2013/6/17/business/13213904&sec=business
Published: Jun 17, 2013

This is following increase in labour charges by 15% to 30% to be implemented soon

Khor: The value of Malaysia’s jewellery product exports for 2013 is likely to increase by 10% to 20%.

“Gold jewellery items are likely to be priced 2% to 3% higher following the increase in labour charges,” he said.

The present labour charge for a 10-gram gold pendant was about RM200, he added.

There is a shortage of skilled workers in the manufacturing of gold jewellery items at present, said Khor further.

“As the investment for the manufacturing of gold jewellery is high, there are fewer local skilled workers from the new generation trained for the trade.

“As a result, foreigners are being trained instead,” Khor said.

On gold prices, he said the price of gold per ounce was now hovering around US$1,400 (RM4,330).

“We expect the price to fall below US$1,300 per ounce in the next couple of months before climbing back at the end of the year, which would spur more buying from overseas.

“The price won't go back to the US$1,800 level in the next 12 months. The value of Malaysia's jewellery product exports for 2013 is likely to increase by 10% to 20% over the RM4.63bil achieved in 2012,” he said.

According to the Malaysia External Trade Development Corp, the value of Malaysia's jewellery product exports for January to April 2013 was RM1.66bil, compared with RM1.60bil in the same period in 2012.

The top buyers were the United Arab Emirates (UAE), Hong Kong, the United States, India and Japan.

From January to April 2013, the UAE bought RM1.56bil worth of gold jewellery from Malaysia, compared with RM1.49bil purchased in the previous corresponding period.

In the same period, Hong Kong bought RM51mil, while the United States, India and Japan imported RM12mil, RM9.9mil and RM7.7mil worth of jewellery products, respectively.

“In the local market, there is expectation that the local retail gold jewellery business would double this year, as the gold price has softened,” noted Khor.

“There is now a higher demand for gold jewellery with higher gold purity content such as 22-karat gold jewellery items.

“Overseas, there is still strong demand for nine-karat gold jewellery,” he added.

The PGA has about 600 members, of which about 10% are gold jewellery manufacturers, exporting some 90% of the country's gold jewellery.