[Jewelry making - Article 00448] - Re: [Orchid] Skyrocketing silver price!

[Daniel Ballard]

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    I've been gathering some numbers for an upcoming publication that we
    will be sending to our alloy customers. I'll share some of them with
    Orchid (and others this is forwarded to)  for perspective. Copper has
    nearly doubled in the last year. The dollar is off but by about one
    third against the Euro. One must consider the SA Rand as well. Zinc
    and nickel are up, and so are most of the trace ingredients like
    silicon, boron, indium, iridium, and you name it. Chinas rapid growth
    is a huge factor. 

    BTW, while certain people are blaming the USA for polluting so much,
    could those same people take a objective look at China and see who
    really needs more industrial scrubbers on power plants, factories and
    refineries, pretty please?  (Sorry, I absorbed one harsh comment too
    many from a European "Green"  advocate) 

    In April 2003, gold was $325, silver was $4.50, platinum was $620,
    and palladium was $170 all per Troy ounce. This year we find gold to
    be $422 (a 29% increase), silver $8.16 (a 82% increase), platinum
    $952(a 53% increase), and palladium to be $353(a whopping 107%
    increase!) This amounts to an average "inflation" of 67% on the very
    precious raw materials we depend on. Never mind gasoline, this makes
    that look small potatoes. What this means to you as a jeweler is
    quite impressive. If you bought alloy from us last year you may have
    paid about $2.00 or maybe $2.50 This year the very same alloy will
    cost $2.99 or more. If you bought 14kt casting gold was  $10.34 now
    the cost is $13.42 and that at a mere 8% above the actual spot and
    metal content. Of course we refiners/suppliers  adjust selling prices
    accordingly, so this is fairly "revenue neutral" in terms of pure
    profits. 

    The pressure is on all refiners and suppliers to somehow absorb the
    difference or part of it.  Which we cannot really do anyway!
    Stuller, Rio, Hoover, Fell, feel free to chime in here! 

    Perhaps some of our "store owner" Orchidians  can chime in on the
    effect this has at the various retail price points. Platinum comes to
    mind as the tough one to reach price points this side of five
    figures. 

    I call this "The Jewelers Inflation Index" and the "zero" reference
    point is April of 2003.  It stands at 1.7. 

Daniel Ballard
WWW.Pmwest.us


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