Sunday, March 31, 2013

Making a Melt: Selling Gold Straight to a Refinery

When you sell gold on 47th Street, there are two ways to go.  You can sell at any one of the small gold dealers (or the larger ones), or you can go straight to a refinery that melts it for you.  Prices are often in the same neighborhood, but when you have scrap that’s not identifiable, or that you suspect is thickly plated over silver, or lots of individual pieces that would have to be tested individually, going to a refinery and “making a melt” is best. 

This means that your gold scrap is melted into a little blob, or bullion, and then analyzed electronically for gold content.  You then get paid out the exact value of your melt in cash, and you are given a copy of the elemental analysis for proof.  You should bring a few grams at least (I’m sure there’s a minimum but I think so), otherwise it’s not worth doing.
Gold Bullion
 During the process, you actually stay with your gold the entire time.  First, your scrap is weighed on a karat scale to the last 1/100th of a pennyweight and the weight displayed on a screen that you can verify, and you get a little receipt with the weight printed on it.  You bring the gold, in the aluminum bowl it was weighed in, together with the receipt, into the room where it is melted and give it to the person doing the melt.  You hold on to your receipt.  The melt takes about 5-7 minutes and you can watch the process.  The gold is heated to about 2000 degrees F, liquefied and melts into a blob shape.  So this is nothing you can do at home!  The guy doing the melt uses huge tongs and wears a special non-flammable glove.  For privacy reasons, I’m not disclosing any names or identifiable pictures of persons, but I was chatting with the guy, and he showed me he got badly burned a day earlier on his finger.

Making the "Melt"
When the melt is done, you bring the bullion to the next room for analysis.  The weight is checked again.  Then a tiny scraping is taken out and analyzed electronically.   The analysis shows the exact % content of every metal, including silver, copper, nickel, and zinc.  This particular melt was 40.57% gold, so it averaged out to 10 karats.  I got paid $131.61 for 4.1 dwt (6.38 grams), so that’s very close to the daily gold price (within a few %).

The analysis is then printed out for you and you take to the cash register to get paid.  You also get a receipt, and now it’s done, there’s no return, no coming back if you changed your mind.  The place I go to is for businesses only, you have to provide your business name, address, and bring ID, which is photocopied.  The melt is invoiced, and I believe it is kept for 24 hrs before it gets shipped out.  All this helps reduce the chances that the gold is stolen, but of course it doesn’t completely eradicate it.

1 comment:

  1. I may be getting some gold soon that I'll want to melt down. This sounds like about the funnest way to go about doing it!