Gold is one of the most sought-after commodities in the world, but its value and rate of appreciation have undoubtedly changed over time. Notably, the jewellery sector has observed a sharp increase in the sale of gold for its scrap value over the past 10 years, which has frequently prompted inquiries regarding the rapidly fluctuating gold prices from our consumers.
The most frequently asked question is: Why does a piece of gold jewellery cost X dollars but have a much lower value when it is sold for scrap?
This blog will assist clarify any questions or concerns regarding gold and its worth at the point of sale as well as during a sale for scrap value. It can be a little confusing at first.
SO WHY IS THE PRICE FOR THE SAME ITEM OF JEWELLERY SO DIFFERENT?
In the end, this is due to the fact that differing definitions of how gold value is determined depend on the circumstances surrounding the exchange of gold for cash.
Due to the extensive processes, effort, and skill required to make a piece of gold jewellery window-shop ready, the price at the point of purchase at a jewellery store is significantly higher. Each of these factors raises the final selling price.
The actual weight of the gold and its carat value are the only variables taken into account when selling gold for scrap metal. Gold is only ever sold as scrap with the intention of being melted down and utilized again.
The drastic shift in gold value is brought on by these variations in the number of operations involved and the aim of the sale. This blog will explain down the steps that go into obtaining a piece of gold from the ground to our shops in order to better help you comprehend and appreciate these procedures!
It will also clarify what happens to your gold after you sell it for scrap, giving you an understanding of the time and effort required for this aspect of the process.
GOLD NEW
This is outlined as first-time retail purchases of jewellery items like a pricey gold necklace chain or a stunning wedding band ring.
To better comprehend the time and work required to create jewellery, let's first look at the procedures that allow you to have your ideal piece:
PROSPECTING
Prospectors are scientists whose job it is to locate gold-bearing areas by searching for gold resources in this manner. A deposit is an area that clearly indicates the presence of gold and can be found by gathering scattered flecks of the precious metal throughout the earth's sedimentary layers. The prospectors must precisely identify these gold bits because they might be as little as sand grains.
Prospectors will drill further into the ground once they have gathered sufficient data to confirm the existence of gold. This gives an idea of how much gold is anticipated to be mined in the chosen location, and it frequently leads to the discovery of other metals like silver. Now that the region has been thoroughly examined, it is time to go retrieve the gold!
MINING
Depending on the type of resource found, mining is carried out in various ways.
DEPOSITS IN LODE
These are gold concentrations that have built up in solid rocks as a result of the metal seeping through the ground and filling in any crevices or cracks it might find. This frequently has a vein-like appearance and runs between various rock strata. If these rocks are found near the surface of the ground, miners will drill explosive-filled holes into them. As a result, the rocks will be forced to crumble, exposing the metal veins inside for mining.
A more involved technique is needed if the lode deposits are located farther down in the earth. To give miners access to the subsurface, where they will excavate lengthy vertical tunnels, a mine shaft is built. Explosives are positioned here to pressure the precious gold metal to release. This is a cautious procedure because a mine shaft collapse can result in casualties.
DEPOSITS ON PLACERS
These are discovered among sedimentary sources of sand and other minerals on the bottoms of rivers and streams. Since gold tends to be much denser than many of the other elements in these deposits, gravity separates it from the others, making it loose and accessible. Panning is a method for extracting gold from placer deposits.
EXTRACTION
Here's where a little chemistry kicks in! The gathered rock is broken up into smaller pieces, and the gold is then separated from other elements either chemically or by melting and heating it. The term "smelting" refers to this heat process.
Following extraction, the precious metals are transformed into bars that can weigh up to 25 kg. The pure gold is subsequently separated from any extraneous components by heating these bars in a furnace with borax and soda ash. To verify the gold content, a sample of the metal is obtained and assayed. The content of pure gold is proven to be 99.9%, which serves as the foundation for all of your magnificent jewellery.
REFINING
Here, pure gold can be customized to a specific color or carat weight. Gold comes in a Different of colors and purity levels, and each has unique characteristics and aesthetic aspects.
THE FAVOURITE GOLD COLOURS ARE:
Gold is then combined with other metals to achieve the required color to make the ideal metal mixture! To make white gold, metals like palladium or silver are added, and copper is added to gold to make warm rose tones.
THE JEWELLERY INDUSTRY ALSO USES 4 WELL KNOWN CARATS OF GOLD:
With 9ct being the lowest and 22ct being the greatest, the carat weight (ct) denotes four grades of gold content in the jewellery. In essence, gold is more expensive the larger the carat!
The number included in brackets, which is a hallmark used to verify the carat weight of jewellery, indicates the amount of gold that is present; for example, 9ct gold contains 37.5% gold, whereas 18ct gold has 75% gold. The remaining portion is made up of a combination of other alloys.
GOLDSMITH
Now that the gold is prepared, it's time for the craftsmanship and artistic talent to enter the process and turn it into lovely fine jewellery. To create a finished product, many different operations such as designing, casting, polishing, stone setting, and more take place here.
Additionally, the object is transported to assay for final details and hallmark authentication. You can see how much time and work this process alone adds to the search for gold since it can take anything from two weeks to three or more months!
In essence, all of these operations need a significant amount of time, effort, energy, and resources. This raises the pricey nature of gold when bought from a jeweller.
NEW GOLD
When you bring gold into a jeweller to be sold for scrap, it is said to be "old gold." This gold is sold to jewellers to be melted down and turned into brand-new, exquisite gold jewellery. The value can change depending on the current demand for gold. It is based on the market price of gold on the day of sale.
The price is set by the price per gram of the gold you want to sell, and it does not account for any gems or the calibre of the jewelry's artistry.
Since it is supplied straight from old gold, the industry essentially doesn't have to spend money or effort mining up gold!
WHAT SHOULD I DO IF I WANT TO MAKE OLD GOLD NEW GOLD?
There is an alternative if you now believe you have gold but don't want to sell it. Have you considered going to our goldsmith to have it melted down and transformed into a brand-new item of jewellery for yourself?
We can redesign your current jewellery and create custom pieces for you. This can be the ideal option to reuse gold jewellery, especially if it has sentimental importance.
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