Sell gold and realize it! Demand for gold recovery is warming up

Huang Yulin

Affected by the uncertainty of US tariff policy, safe-haven assets continue to flow into the gold market. On February 20th, the price of gold surged again, with COMEX gold reaching a maximum of $2,957 per ounce, with an intraday increase of nearly 0.3%.

As the price of gold rose, many investors seized the opportunity to realize it. A reporter from China, a brokerage firm, visited and found that after the year, the passenger flow of gold recycling channels such as commercial banks and gold stalls increased, and some banks took the opportunity to attract customers and launched non-bank gold recycling services.

"Not all outlets support gold recycling." It is understood that under normal circumstances, only the outlets with higher specifications in the region will open the gold recycling business, and the recycling price is linked to the international gold price and gold purchase channels.

Commercial banks actively attract customers.

"There are people who consult gold bars and gold investments almost every day." The manager of a lobby of a state-owned bank in Guangdong told China, a brokerage firm, that since the year, the price of gold has continued to rise, and customers’ demand for gold investment transactions has increased significantly. The reporter saw in the mobile online shopping malls of several banks that the investment gold bars sold showed "out of stock" status.

There is also the gold recycling business, but it is worth noting that not all commercial bank outlets provide gold recycling services.

Take ICBC as an example. According to the "ICBC Gold Repurchase Raiders" issued by the bank, the bank has more than 500 repurchase outlets. China, a brokerage, found that the bank has nearly 30 outlets in Beijing to support this business. The gold repurchase strategy issued by the Agricultural Bank of China Retail Bank shows that the bank has opened nearly 3,000 gold repurchase outlets nationwide to provide customers with convenient gold trading channels and services.

It is understood that most commercial banks have strict requirements on the "brand name" in the gold recycling business they invest in, and most commercial banks can only recycle the gold bars they sell. "Gold bars need to be sold by the Bank, and relevant bills such as packaging and proof of purchase must be kept." The staff of the Agricultural Bank said.

As the demand heats up, some banks also take the opportunity to carry out gold recovery business that is not sold by the bank. ICBC recently launched the repurchase service of "non-ICBC brand gold bars received by ICBC". In addition to the gold products sold by ICBC, it can also repurchase Au99.99 brand gold bars from 14 commercial banks and 2 gold enterprises (China Gold and Shandong Zhaojin).

Regarding the repurchase price, ICBC’s customer service responded: "The basic price of gold repurchase is set with reference to the price of Shanghai Gold Exchange. Generally, a certain repurchase spread is deducted from the basic price of gold repurchase, in which the repurchase spread of brand gold of the Bank is 4 yuan/gram, and the repurchase spread of other gold products is 10 yuan/gram."

Dong Ximiao, the chief researcher of Zhaolian, said that the bank’s gold repurchase business can first meet the needs of customers to realize gold bars to obtain liquidity after the gold price rises. Secondly, banks can also obtain fee income through repurchase price difference. "

"The transformation after the customer’s gold is recovered and realized is also very important." Dong Ximiao said that after the customer’s physical gold is realized, the funds are likely to be used to purchase wealth management and fund needs, which is also an opportunity for commercial banks to acquire customers and increase customer stickiness.

Demand is hot! Brand stores adjust the "trade-in" rule

In addition to commercial banks, branded gold shops and pawn shops are also the main channels for gold recovery. "From the beginning of 2024, the passenger flow recovered every month has increased." Wife of shop-owner Liu, who runs stalls in Shenzhen Shuibei Market, the largest gold and jewelry trading market in China, told China, a brokerage firm.

Many operators said that the recovery price in the shellfish market also fluctuates with the international gold price, and the general recovery price difference is around 7-15 yuan. In contrast, the gold recycling service of brand gold shops has a big difference. Take Chow Tai Fook as an example. On February 20th, the full gold price was 892 yuan/gram, and the gold recycling service price was 666 yuan/gram.

Some operators said that because the price of gold is too high, many consumers choose to buy physical gold in the form of "exchanging old gold for new ones, and the price difference is more refunded and less replenished": "In addition to realizing cash, the guests who come to the Shuibei market want to exchange old gold for new ones, and deduct the total price of new ornaments with old gold ornaments to get physical gold with newer styles or heavier weight."

Data show that on February 21st, the price of gold jewelry of Chow Tai Fook, Leofoo, Luk Fook Jewelry and other brands has reached 892 yuan/gram, while that of Zhou Shengsheng has risen to 895 yuan/gram. Online gold brand stores are still crowded.

During the visit, some merchants reported that due to the recent surge in demand for "trade-in" and "gold recycling", the brand of gold ornaments has begun to adjust the relevant rules of gold recycling business.

"If you recycle it today, you can also’ get grams by grams’ (meaning that 1g of old gold can be deducted and exchanged for 1g of new jewelry), and you only need to make up the work fee. In a couple of days, we will adjust the rules, which may need to be increased by 20% to 30%. For example, if you want to buy 10g new jewelry, you need to recycle 12g and 13g old gold. " On February 19th, a salesperson of a Zhou Dasheng store in Beijing told China, a brokerage firm.

Lou Feipeng, a researcher at the Postal Savings Bank, told reporters that the price of gold has hit record highs recently, and the market expects that the price of gold may fluctuate next. For investors who invested in gold at a low point in the early stage, it is an effective way to increase investment income by choosing to leave their bags for safety.

"For gold recycling, different channels have different risks." Wang Pengbo, a senior analyst in Broadcom Consulting’s financial industry, pointed out that the conditions for bank repurchase are relatively strict, and there are requirements for the appearance and certificate of gold; Moreover, due to profit and risk considerations, the price given by pawnshops is usually low, and customers have to bear the redemption risk; Gold stores may have irregular operations and are greatly affected by their own business strategies.

Wang Pengbo said that investors need to understand the recycling policies of different channels, and then make a decision after comparison according to their actual situation. They should also understand the market conditions and have a rough judgment on the value of gold to avoid being acquired at an unreasonable low price. In addition, if you don’t choose commercial banks, investors are advised to choose big stores or banks with good reputation for trading.

Editor: Luo Xiaoxia

Proofreading: Su Huanwen