Jeweller - May 2021

FEATURE
Casting and Refining
CASTING AND REFINING FEATURE | Reset & Refine
RECENT STATS
Precious Metal
Trends
The process of casting and refining may be
restricted by the laws of physics, but that
doesn’t mean innovation is impossible.
New technologies are opening up new
possibilities, writes CALLUM GLENNEN.
Molten gold is poured. Image: SHUTTERSTOCK
T
he COVID-19 pandemic has disrupted
countless industries, but consumer interest
in jewellery has fared surprisingly well.
Data from Retail Edge Consultants released late
last year revealed November sales figures across
the jewellery industry were as much as 20 per cent
higher than what was seen during the same period
in 2019.
Unable to travel, a significant portion of the public’s
discretionary spending appears to have shifted towards
luxury goods; and with Australia still months – if not a full
year – away from fully resuming international travel, this
increased interest in luxury purchases could be expected
to continue for some time.
To fully capitalise on this, casters and refiners are
developing new services and systems to be even more
responsive to the needs of jewellers.
Chris Botha, operations manager at Palloys – part of the
Pallion Group of companies – says, “Palloys has extensively
increased its casting and refining capacity to handle the
additional volume in the past year, and has also doubled
its CAD and CAM printing capability to better manage the
increased demand and casting capacity.”
Richard Hayes, CEO The Perth Mint – which refines the
majority of the gold produced in Australia – has noted
similar trends, “The vast bulk of Australian gold producers
continue to entrust their refining needs to The Perth Mint.
“Additional refining and casting capacity has been
commissioned over the last 12 months.”
With the increased demand from customers, combined
with unpredictable metal prices, making use of every
resource available will be crucial for making the most
of current opportunities.
The gold standard
A sudden jump in the price of precious metals has
made every piece of scrap, lemel, and sweep all the
more valuable, highlighting the value of efficient casting
and refining.
“The combination of precious metal prices and COVID-
19’s effects on business, particularly within the jewellery
industry, has significantly increased the demand for
Palloys’ refining services,” Botha tells Jeweller.
“Palloys refining jobs and scrap metal buyback numbers
have increased over the past six months. As a result,
Palloys now offers very competitive pricing and faster
turnarounds.”
He adds, “Our sister company, ABC Refinery, completes
all Palloys metals and refining services. In this way, from
our casting alloys to our fabricated metal supply Palloys is
the only jewellery manufacturer that can trace its precious
52%
increase in
consumer demand
for gold in the three
months to 31 March
World Gold Council
17%
forecast increase
in platinum supply
in 2021
World Platinum
Investment Council
184tn
forecast demand
for silver jewellery
in 2021, an
increase of 24%
Metals Focus and The Silver
Institute, ‘World Silver
Survey 2021’
95.6%
increase in
palladium price
per ounce in US
dollars, March
2020 to April 2021
MacroTrends.net
$20.55
average silver
price per ounce
in US dollars,
2020 – a sevenyear
high
Metals Focus and The
Silver Institute, ‘World
Silver Survey 2021’
metals supply directly to its primary source.”
Thanks to commodities being viewed as a safe store
of wealth during uncertain times, the price of gold
skyrocketed in 2020. After a record-breaking peak of over
$US2,000 per ounce in August, its price has since fallen by
approximately 15 per cent.
Hayes explains, “Precious metals have risen in price
over the last 18 months due to a range of global macroeconomic
factors and geopolitical issues.
“These include massive amounts of fiscal stimulus
– especially by the US government – inverted and/or
historically low bond yields and interest rates, Chinese
territorial and economic expansionism, and COVID-19.”
He adds, “The world has become a less certain place and
investors have sought to manage their risk and exposure
to more traditional asset classes, by diverting investment
flows into precious metals.
A sudden jump in the price of
precious metals has made every
piece of scrap, lemel, and sweep all
the more valuable, highlighting the
value of efficient casting and refining
“The rises in precious metals prices over the last 18
months have sparked renewed interest in precious metals
as a store of wealth and a vehicle for wealth management
for investors large and small.”
While still well above pre-pandemic levels, the sudden
changes in direction have had a substantial effect on
gold’s availability, which will impact supply for the
foreseeable future.
“Currently, we are experiencing gold, and other precious
metals, showing extreme highs followed by price
contractions within a relatively short period of time,” Peter
Beck, director Peter W Beck – which includes a Precious
Metal Services division – told Jeweller.
“As a result, refiners are feeling the expected impacts
of the price of gold both rising and falling. This in turn
is having an effect on the supply and demand of
precious metals.”
Hayes observes, “The increase in the gold price has made
marginal gold deposits viable, which has increased refining
volumes globally.”
Likewise, silver has also recorded a remarkable surge;
its price increased 137 per cent during 2020, compared
with gold’s 38 per cent. According to international
industry association The Silver Institute, the precious
metal is expected to hit its highest level of demand in
six years in 2021.
31 | May 2021
May 2021 | 32