Third market for refined gold

[Anonymous]

I currently have been in the secondary market of scrap gold (i.e. buying from jewelry stores and pawn shops), taking it to have a assay scan done by a florospectrometer, and given a check based on it's assay at 98%. I typically work at a 5% margin and do daily runs picking up gold and furnishing cash flow. I am not comfortable with the accuracy of this method and I am ready to go into the next arena of gold processing, doing the spectrometer test and paying out to the dealers (jewelry store and pawn shops), based on the results. By doing this I would be able to pay out to my customers a higher percentage, and eliminate an inefficient step of my process where I have no control. I have researched methods of refining and am comfortable with a couple of systems, but have one lingering question. What to do with the refined gold? It would be in pure(ish) form .995, in quantities of 50oz (yes, ounce) per day. Are there hedge funds, third world countries for coinage, the US government, etc who would give me 100% of spot to be refined further and resold/reused at a premium? There seems to be a void in information on the internet and the refiners I do business with are pretty tight lipped. They are pretty fat and happy during this period and are not looking for any competition. I could handle a 99% of spot as well. Your help and knowledge would be appreciated

 

[Noxx]

Banks generally buy gold from refineries at spot (or slighly above).

If you have the time and money, you could mint your own bars and sell them at spot to investors. The thing is, you need to have a lot of clients in order to sell for 50oz each day...

My opinion is (and it's worth 2 cents), that you shouldn't ''waste'' your money on refining the gold yourself and sell it to 98%-98.5% to some refiners.

But be sure to get paid to the real value of your gold:

-Melt all the jewelry
-Cast into a bar
-Drill the bar in various places
-Assay the fillings

Accurate methods are fire assays, ICP and Atomic Absorption.

 

[Anonymous]

Thank you for your input, but I am assuming the position of refiner. I need to find out where to sell to those whole can handle high volume as mentioned. Although, 50 oz a day is not that high, it is our initial objective. I have heard there are some refiners that will pay 99% and there is another percent in ancillary metal reclaimation, volume is the key to making my plan work. If we could, I would like to hear from those who represent the refiners and or are high volume producers. Thanks

 

[nickvc]

my opinion is that you could end up chasing pennies when the real money is in trading the gold in assayed bar form. I ran a refinery but the demise of manufacturing in the uk left me with no end users of the gold at a price that left any profit.Times have changed and the demand for bullion is high, but for how long.Melt your gold get an assay and trade it, GSP offers an assaying service,there are large refiners on this site who im sure would be glad to buy your bars at close to spot. By all means try refining but start with small amounts, and work out if it really is worth the time and effort, and dont forget things do go wrong, and even if they dont, your turnround time is i reckon 3 to 5 days which means having maybe 250 ozs in stock and if the fix is falling

 

[4metals]

With the falling off of the jewelry market most refiners are having a difficult time getting rid of their metal, forget about spot. Check into large refiners who produce 9999 fine gold. They all use a 2 step process be it chlorination and gold cells or twice refined in aqua regia. If you are selling a product which is as pure or purer than their first refine it can fit easily into their production stream and they should offer you better rates.

I'm sure you can get it under 1/2% (99.5% accountability) and possibly better. The problem is quantity. Going in with 50 fine ounces a day is a hiccup for these guys, consider shipping once a week with 250 ounces fine. Another advantage is they will set up pool accounts so your metal can be used to hedge your buys on the day you settle. It means holding on to an inventory but it eliminates your risk.

Check out Metalor in North Attleborough, Massachusetts 508-699-8800 They do a chlorination preliminary process (shssshhhh it's a secret) followed by gold cells to get 9999 fine gold. They give better rates for high purity gold. As I said your volume, while nothing to sneeze at, may be an issue.

 

[Anonymous]

Thank you for the information. That is exactly what I was looking for!

 

[Platdigger]

4metals, sorry to bump an old thread...but...you mentioned:

"They do a chlorination preliminary process (shssshhhh it's a secret)"

Care to elaborate?

Is this a pressurized process?

 

[4metals]

Chlorine gas is pressurized, delivered from cylinders and bubbled into molten alloy. As in the classic Miller process.