There’s a gold rush in China. 

But unlike the past where middle-aged Chinese were purchasing the gold metal, it’s the young who are now showing a growing appetite for this precious, yellow metal — albeit in bean form.

Smaller than a fingertip and often shaped like lucky symbols like ingots or koi fish, gold beans are quickly gaining popularity among China’s Gen Z. Weighing roughly one gram and priced between 400 and 600 yuan, they offer an affordable entry point for buyers. Many purchase one or two pieces monthly, likening the cost to their regular milk tea expenses. 

To many young people, these little glittering nuggets signify more than mere savings — they’re a viable long-term investment. Traditionally, China’s middle-aged and elderly were the primary consumers of gold, but now Gen Z is gravitating towards these diminutive gold products. 

On social media platforms, young Chinese are even chronicling their journey of slowly filling small glass bottles with gold beans. While some bottles have just a few beans at the bottom, others are almost full, with enthusiasts frequently sharing their experiences. The hashtag “gold beans” on Sina Weibo has garnered over one million views and over 20,000 notes with topics ranging from collection strategy to store recommendations and vouchers, and how to turn their collected beans into decorative accessories being the hottest searches.

Buying gold beans isn’t without its own perils. Experts have noted that many of those buying gold beans are being duped with fakes. Nikos Kavalis, managing director at the London-based consultancy Metals Focus Ltd. has also warned people from buying gold beans. Kavalis said that it made no sense to invest in gold beans because their price is often 10 to 30 percent higher than the commodity’s spot price. Investors would be better served by parking money in gold exchange-traded funds(ETFs). 

At the same time, the rally in gold continues with prices hitting an all-time high on Thursday — and there’s room for it to rise more as central banks continue to purchase bullion in record amounts. 

Spot gold is currently trading at above US$2,200 per ounce, which analysts said could rise to US$2,300 per ounce in the second half of 2024, especially against the backdrop of expectations that the U.S. Federal Reserve could cut rates in the second half.

Gold back in favor with Gen Z

In the not-too-distant past, gold symbolized the taste of the older generations, but it is now a statement of Gen Z's identity that represents both personal style and cultural loyalty.

In a 2023 report on the jewelry and accessories industry, China’s leading e-commerce platforms Tmall and Taobao revealed that the primary consumers of gold jewelry are those born after the 1990s. And in 2022, an insight report by consultancy firm Mob Data found that Gen Z’s inclination to purchase gold surged from 16 percent in 2016 to 59 percent in 2021 — marking the highest spending potential among all age groups.

The rise of the “guochao” or “China chic” trend, which celebrates Chinese identity, coupled with the increasing value of gold, has created significant market opportunities in the gold jewelry market in China, which was valued at 410 billion yuan (US$57 billion) in 2022, according to the Gems and Jewelry Trade Association of China. The market has grown about 12 percent compared with the pre-pandemic level in 2019 and 66 percent compared with 2012. 

Domestic jewelry brands have begun collaborating with popular franchises in order to tap younger customer interest. In 2020, Luk Fook Jewelry collaborated with Chinese video game Nezha, and Chow Sang Sang Jewelry launched a joint series with the Forbidden City.

Shandong Gold Group said it has been actively engaged in exchanges and cooperation with universities, inheritors of intangible cultural heritages, and cultural and art institutions, to better explore the integration of traditional culture with innovation in gold jewelry designs and techniques, in order to inject vitality into the gold industry.

Launching sub-lines or sub-brands is also a smart way to get in front of younger customers. In 2016, Chow Tai Fook launched the trendy jewelry brand Monologue, and in 2017 launched the brand So In Love, which targets the luxury wedding market; and, in 2019, Chow Sang Sang launched the fashion concept brand Minty Green.

Chow Tai Fook has also leveraged social media to adapt to this new interest, managing director Kent Wong said. A recent survey of 5,000 Chinese consumers aged between 18 and 40 showed that more than 90 percent prefer to buy jewelry with symbolic meaning related to Chinese culture. According to the survey, carried out by market research company Ipsos for Chow Tai Fook, around two thirds of respondents were interested in buying gold jewelry.

“Unlike traditional consumers who focus on gold purity and price, young people are increasingly prioritizing the overall purchasing experience, along with the craftsmanship of the jewelry and the narratives behind it,” Wong said.

Fashionable and lightweight gold jewelry has gained significant favor among consumers, contributing to the overall increase in gold jewelry consumption, said the China Gold Association.

Young Chinese aged between 25 and 34 have become the main force of gold consumption, with their proportion at 59 percent in 2023. In the future, consumers under the age of 25 will become new major gold buyers, the association predicted.

What’s driving the gold rush?

With the dramatic rise in international gold prices, many Chinese investors are looking with interest at the yellow metal, an investment where risks and opportunities coexist.

Consumption of gold, whose appeal had once waned as Chinese consumers favored diamonds and other gems, has remained robust during the Spring Festival holiday despite elevated prices.

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