Metalor Technologies SA, based in
Switzerland, expects to complete its gold refinery in Singapore
by the end of this year as the country seeks to expand its share
of global bullion trading.
The precious-metals processor cast its first one-kilogram
gold bar in Singapore this week, Chairman Scott Morrison said.
The $15 million refinery will have a capacity of about 150
metric tons a year, he said on Bloomberg Television’s “First
Up” With Susan Li.
Gold slumped 17 percent this year, entering a bear market
in April, as an improving U.S. economy spurred a rally in
equities and undermined some investors’ faith in the metal as a
store of value. Singapore removed a 7 percent sales tax from
investment-grade precious metals last year in a bid to boost
trading, while Deutsche Bank AG and JPMorgan Chase Co. have
opened vaults in the city. The plunge in April stoked a buying
frenzy for bars, coins and jewelry from China to India.
“Right now, we can’t keep up with the demand in terms of
investors in Asia purchasing gold,” said Morrison. “The amount
of physical gold that is being sold to the investment community
is quite substantial.”
Premiums in Singapore over London prices touched a record
$7 an ounce last month because of shortages in supply, according
to Brian Lan, managing director at bullion dealer GoldSilver
Central Ltd. in the city. The London price fell 14 percent in
two sessions through April 15, the most since 1983.
Growth Plan
Cash bullion was little changed at $1,387.55 an ounce by
5:29 p.m. in Singapore today. While prices are up about 5
percent from a two-year low of $1,321.95 on April 16, they’re
still 28 percent below the record $1,921.15 in September 2011.
“We already have a well-established refinery in Hong Kong
and a smaller one in mainland china,” said Morrison.
“Singapore is really our expansion plan in the Asia-Pacific
area.” The company also has refining operations in the U.S. and
Switzerland, according to its website.
Banks are adding to storage in Singapore. Deutsche Bank
started a vault with the capacity to hold as much as 200 metric
tons, its largest outside London, it said this week. JPMorgan
opened a vault at the FreePort in 2010.
Gold trade in the city reached 74.6 tons in the seven
months through April from October, when Singapore removed the
precious-metals tax, according to International Enterprise
Singapore, the external trade agency. That was little changed
from 72 tons a year earlier, its data show.
The country is targeting 10 percent to 15 percent of world
demand flow in the next five to 10 years, according to Kathy Lai, assistant chief executive officer at IE Singapore, in March
2012. Total demand worldwide was 4,405.5 tons in 2012, according
to the World Gold Council.
Scrapping the tax was a first step toward developing trade
in Singapore and the Metalor refinery is another, IE Singapore
said in an e-mail June 11. It will take time to create the
infrastructure and build the sector, it said.
To contact the reporter on this story:
Glenys Sim in Singapore at
gsim4@bloomberg.net
To contact the editor responsible for this story:
James Poole at
jpoole4@bloomberg.net
Metalor Set to Complete Singapore Gold Refinery by Year-End
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