South Koreans stock up on gold and ready meals as fear economy booms

A relief goods storage is seen inside a subway station which is used as a shelter for emergency situations. Koreans are stocking up on ready to eat meals and buying gold amid a tense political standoff. (Reuters)
Updated 13 August 2017
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South Koreans stock up on gold and ready meals as fear economy booms

SEOUL: South Koreans are buying more gold and ready-to-eat meals as rhetoric between North Korea and the US ramps up tension.
Long used to living within the range of North Korea’s artillery, people in the South have generally ignored its aggressiveness and series of nuclear and long-range missile tests. But this week, as Pyongyang exchanged increasingly angry words with the US, there are worries of a clash erupting along the heavily militarized frontier which divides the two Koreas.
Combat Ration Inc., which makes 2 billion won ($1.75 million) of annual revenue selling ready-to-eat meals, said sales had surged as much as 50 percent in the past week compared to the average.
“Since 2006, when North Korea first conducted its nuclear test, there wasn’t this much response as people became immune to frequent missile launches and nuclear tests,” said Yoon Hee-yeul, the chief executive of Combat Ration, based in the southeastern city of Daegu.
“I feel it’s different this time,” said Yoon, who has been in the business since 2004.
Ready-to-eat meals maker Babmart, based in eastern Seoul, and another Seoul-based online seller, jun2food.com, also said sales have increased. Officials at both companies attributed the surge to the heightened tension.
“Koreans used to be numb to North Korea’s threats, however, it seems different this time, and people are taking it seriously,” said Song Jong-gil, an official of Korea Gold Exchange 3M, where sales of mini gold bars have surged five-fold since Aug. 9.
After Trump’s “fire and fury” threat heightened tension, average daily sales volume has been 250 bars, ranging in weight between 10 grams (0.35 oz) and 100 grams (3.5 oz), versus about 50 earlier, Song said, adding the trend would continue through August.
Investors widely consider gold a safe-haven asset at times of growing geopolitical risk or economic uncertainty. South Koreans, who are still technically at war with their combative neighbours, are no exception.
Few bomb shelters have long-term supplies of food, water, medical kits or gas masks, because the mostly private owners of the shelters get no public funding.


OPEC oil ministers gather to discuss production increase

Updated 19 June 2018
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OPEC oil ministers gather to discuss production increase

  • Analysts expect the group to discuss an increase in production of about 1 million barrels a day
  • The officials were arriving in Vienna ahead of the official meeting Friday

VIENNA: The oil ministers of the OPEC cartel were gathering Tuesday to discuss this week whether to increase production of crude and help limit a rise in global energy prices.
The officials were arriving in Vienna ahead of the official meeting Friday, when they will also confer with Russia, a non-OPEC country that since late 2016 has cooperated with the cartel to limit production.
Analysts expect the group to discuss an increase in production of about 1 million barrels a day, ending the output cut agreed on in 2016.
The cut has since then pushed up the price of crude oil by about 50 percent. The US benchmark in May hit its highest level in three and half years, at $72.35 a barrel.
Upon arriving, the energy minister of the United Arab Emirates, Suhail Al Mazrouei, said: “It’s going to be hopefully a good meeting. We look forward to having this gathering with OPEC and non-OPEC.”
The 14 countries in the Organization of the Petroleum Exporting Countries make more money with higher prices, but are mindful of the fact that more expensive crude can encourage a shift to renewable resources and hurt demand.
“Consumers as well as businesses will be hoping that this week’s OPEC meeting succeeds in keeping a lid on prices, and in so doing calling a halt to a period which has seen a steady rise in fuel costs,” said Michael Hewson, chief market analyst at CMC Markets UK
The rise in the cost of oil has been a key factor in driving up consumer price inflation in major economies like the US and Europe in recent months.
Already US President Donald Trump has called on OPEC to cut production, tweeting in April and again this month that “OPEC is at it again” by allowing oil prices to rise.
Within OPEC, an increase in output will not affect all countries equally. While Saudi Arabia, the cartel’s biggest producer, is seen to be open to a rise in production, other countries cannot afford to do so. Those include Iran and Venezuela, whose industries are stymied either by international sanctions or domestic turmoil. Iran is a fierce regional rival to Saudi Arabia, meaning the OPEC deal could also influence the geopolitics in the Middle East.