Gold Shipments from Singapore to US Surge to Three-Year High

Singapore's gold exports to the United States have reached their highest level in nearly three years in January, reflecting disruptions in the global bullion market due to price disparities.

Increased Shipments to the US

Data from Enterprise Singapore reveals that around 11 tons of gold were shipped from Singapore to the US in January, a 27% increase from December and the highest volume since March 2022. Traditionally, Singapore's gold exports primarily flow to Asian destinations.

Market Upheaval

The global gold market has recently faced significant volatility, with prices hovering near record highs. Concerns over potential tariffs from the Biden administration on precious metals have contributed to a wide premium for bullion futures in New York compared to international benchmarks in London. This price discrepancy has spurred imports into the US.

Refineries and Flows

Nikos Kavalis, managing director at Metals Focus, explained that gold shipments are being sourced from locations with refineries. Singapore hosts one of Metalor Technology SA's gold refineries, which is certified by the London Metal Bullion Association.

Regional Demand and Asia's Role

Under normal circumstances, Singapore exports gold bars primarily to Asian destinations based on demand. When regional demand is insufficient, gold bars are typically shipped to London, the central gold trading hub.

Price Premium and Futures

As of Tuesday, futures on the Comex were trading at approximately $2,925 per ounce, while spot gold in London was trading around $2,912 per ounce, resulting in a difference of approximately $13. In January, the premium was significantly wider, reaching over $50 towards the end of the month.

Pandemic Surge and Border Restrictions

The last major spike in gold flows from Singapore to the US occurred during the COVID-19 pandemic, when border and trade restrictions raised concerns about the ability to settle futures contracts. In July 2020, shipments from Singapore reached approximately 26 tons.