South Korea’s state-run mint is grappling with a gold bar shortage amid robust demand for the precious metal.
The Korea Minting and Security Printing Corporation (KOMSCO), which is responsible for the production and distribution of various security products, suspended sales of gold bars last month.
KOMSCO attributed the suspension to issues with procuring supply of raw materials, according to a Google translation of the notice on its website. The mint typically supplies bullion bars to Korea’s commercial banks, stores and online shopping malls.
Vending machines in the capital of Seoul reportedly sold out of fingernail-sized gold bars, according to local media outlets, as consumers scrambled to purchase the safe-haven asset.
“The sudden spike in gold demand in South Korea has led to Korean banks to temporarily suspend gold bar sales at the request of KOMSCO as there are not enough gold bars in the country to fulfil local demand,” said Robin Tsui, APAC gold strategist at State Street Global Advisors.
Demand is largely being driven by retail investors, industry watchers told, with many piling into the asset as a hedge against domestic political turmoil and concerns of economic and geopolitical uncertainty sparked by U.S. President Donald Trump’s tariffs.
South Korean President Yoon Suk Yeol is currently awaiting an impeachment verdict after his short-lived declaration of martial law on Dec. 3.
Lawmakers also voted to impeach acting president Han Duck-soo late last year, plunging the country into renewed political turbulence. South Korea’s second acting president after Han, Choi Sang-mok, has faced some opposition from the public over what they see as actions to hinder efforts to apprehend Yoon.
South Korea’s domestic turmoil has corresponded with Trump’s return to the White House and, along with it, the prospect of an escalating trade war.