What You Need to Know About Gold Refining

January 26, 2020

What You Need to Know About Gold Refining

Gold traders rely on refiners to produce high-quality, high-purity bars. Whether you’re buying bullion or you’re a trader that needs to refine recycled precious metals into saleable bars, you should know how the refining process works and what makes a quality bar.

When you go to your local bullion dealer to invest in new bars, you want to know that what you’re buying meets international standards. While precious metal will always be valuable no matter what state it’s in, bars that meet international LBMA refining standards are easier to sell quickly and with a better return. A superior bar improves the liquidity of your investment.

 

The Refining Process

 

Refiners start with one of two types of gold: a doré bar or scrap. Doré bars are produced by miners and are about 80 percent pure. Refiners increase the purity by separating the other precious metals and less precious metals that are mined with it.

 

  • Using induction heating, doré bars and scrap are turned into molten metal.
  • Borax and soda ash are added to the molten metal to separate other precious metals and less precious metals.
  • The metal is then tested, also called an assay, to judge purity.
  • The molten metal is then cast into bars.

 

For jewellery and industrial applications, the metal is often formed into an alloy as gold is too soft in its pure form for practical applications. 

 

Refiners usually do not buy the bullion, but refine it while it is owned by the mining company. After the bullion has been refined, ownership then transfers to the bullion bank.

 

Silver Refining

 

The process for refining silver bullion is similar. Silver is brought out of the ground in ore: rock and sediment in which precious metals, often mixed, can be found. The ore is first crushed into pieces. Lime is then added to create an alkaline environment. A cyanide solution is then added and the mixture is cured for 24 to 48 hours.

 

A fine dust of zinc is then added to precipitate the silver from the resulting solution, recovering the precious metal from other materials contained in the ore. The silver precipitate can be filtered and then melted into bars.

 

Recycled Gold

 

Mining is not the only source of precious metals in the world. Recycling has also become a major source of new bullion supply, and the sources of recycled gold are varied. Today, about one third of global supply comes from the recycling supply chain.

 

Major sources of recycled precious metals include e-waste, jewellery, and junk silver. Computer companies like Dell have entered the recycled gold business, turning metal sourced from old computers and other e-waste into jewellery as the price of recycled gold has surpassed newly mined bullion. An estimated $60 million in precious metals are thrown away annually as part of e-waste.

 

By sourcing from the recycled gold supply chain, refiners know that their metals have been ethically sourced, or at least that no new conflict was involved in its acquisition. The conflict-free gold standard developed by the World Gold Council recognizes responsible mining and can ensure refiners are ethically sourcing their metals, but recycling is another way to acquire responsibly sourced gold.

 

Ethical sourcing is a key element of LBMA refining for silver and gold and important to both jewelry and bullion markets.

Global Bullion Refines Gold

 

In addition to buying and selling gold, Global Bullion Suppliers is also a refiner. We use a five-step process to ensure your precious metals are turned into high-quality bars, so that you get paid more for your precious metals.

 

Step #1: Weighing Your Metals

 

We weigh each lot separately and accurately on State-sealed scales. These scales are certified every 90 days, and the weighing process is all done on camera. Our refinery is located in Hollywood Florida, where you are always free to visit the on-site viewing room. You can watch both the weigh-in and the melt to be sure of the integrity of the process. We also have a live video feed from our storefront in Toronto to view the refining process.

 

Step #2: Melt

 

We recommend that each karat should be melted separately when applicable, which means separating 10k, 14k, and 18k and 22k lots, as well as separating coins from scrap jewellery. This makes it easier to achieve maximum homogenization. At Global Bullion Suppliers, we use solid state induction heating equipment to minimize melt loss, under the guidance of industry experts.

 

Step #3: Sampling

 

We take a pin sample and provide it to each customer so that they can have it independently analyzed. There is nothing more important than ensuring the integrity of your gold bars. The bar is poured immediately after sampling, both to minimize melt loss and achieve the correct assay.

 

Step #4: Assay

 

The next step is to conduct a metallurgical assay using state of the art XRF (X-Ray Fluorescence) technology showing gold, silver, platinum, and palladium content. The report is sent for you to review.

 

Step #5: Payment

 

Select your payment method per lot and lock-in your price at your request. You can select wire, bank draft, cheque, or bullion trade.

 

If you are a precious metals trader, gold, silver, platinum, and palladium are all accepted metals for refining into bars.

 

What Do Gold Buyers Do with Jewellery?

 

When you sell gold jewellery to most types of buyers, whether it’s an exchange, a cash-for-gold business, or a bullion dealer, they typically do not pay for the value of the design or artisanship. That’s because they intend on melting the piece down as scrap and refining it into a bullion bar. They are aiming to pay for the value of the bullion contents, not the craftsmanship of the jewelry.

 

Why Buy LBMA Refined Bars

 

When you purchase gold bars refined to London Good Delivery standards, you know you are buying a bullion product made to standards trusted the world over. The LBMA proactively monitors all of the refiners on its Good Delivery List, which includes national mints like the RCM. Since 2012, the LBMA has also kept a Good Delivery List for silver refiners. You need to know that the bullion products you’re buying are accurate and high-quality.



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