Gold is selling like hot cakes in South Korea. What do the locals keep the small 1 gram ingots in?

Considered a safe-haven asset, gold is selling like hot cakes in South Korean stores, with the metal as popular as the famous ramen soup.

“Besides ramen and sausage, the stores from South Korea have a popular new item on the menu – gold bars“, writes CNBC.

The country’s largest convenience store chain, CU, has partnered with Korea Minting and Security Printing Corporation (KOMSCO) to offer customers mini gold bars – and they’re selling like hotcakes.

A variety of fingernail-sized gold bars ranging in weight from 0.1 grams to 1.87 grams have been on sale at CU outlets since April. A 1.87 gram stick sells for 225,000 won ($165.76), and a 0.5 gram stick sells for 77,000 won.

Priced at 113,000 won each, the 1 gram bars sold out in two days, according to local news. They are sold along with greeting messages, birthday wishes and even models for personality types.

People in their 30s have been the most active in purchasing these gold bars, accounting for more than 41 percent of total sales since their launch, according to CU’s Pocket CU business phone app. Those in their 40s account for 35.2% of sales, followed by those in their 50s with 15.6%. People in their 20s accounted for 6.8% of all sales.

Demand of 5 tons in the first quarter

Demand for bullion and coins from South Korea rose 27% year-on-year to 5 tonnes in the first quarter of this year amid rising prices for the yellow metal, the World Gold Council said in a recent report. This was the strongest quarterly increase in South Korea’s gold purchases in two years, the WGC noted.

Other convenience stores are also riding the bullion demand wave.

At the GS25 convenience store chain in South Korea, customers can buy small gold bars from vending machines.

“Typically, in times of economic uncertainty, when the local currency depreciates, demand for physical gold jewelry increases as domestic investors look for safe haven asset investments”, said Heng Koon How, Head of Markets Strategy, Global Economy and Market Research at UOB.

Gold prices rose to a record 456,000 won ($335.3) per 3.75 grams, or 0.13 ounces, according to the Korea Gold Exchange. In contrast, the Korean won has depreciated by more than 5% against the US dollar this year, currently trading at 1,358.7 units to 1 dollar.

Small 1 gram ingots, kept in glass jars

The WGC has noted a recent trend of increased investment interest among a younger cohort in Asia, even as gold prices exceed record levels.

Consumers in Asia’s largest economy, China, have also bought gold, with collecting small, 1-gram bars in glass jars becoming a trend among the country’s youth.

China also leads consumer demand for bullion, with the country overtaking India in 2023 to become the world’s largest buyer of gold jewellery.

Separately, last year in the US, giant Costco became a popular place to buy one-ounce gold bars, at prices close to $1,900.