Editor’s Note
This article highlights a severe downturn in Mexico’s gold market, where a sharp rise in consumer prices has led to dramatically reduced sales. The economic impact is substantial, with annual revenue in the state of Puebla falling by billions of pesos over a five-year period.
Individuals dedicated to gold distribution report that the decline is due to a price increase for the public of up to 60 percent. The low demand for this product has caused the economic spillover generated by this activity for the state of Puebla to also experience a significant drop.
The General Mining Service (SGM) details that in 2016, gold sales generated 28,299,218,000 pesos per year, and by 2021, the figure fell to 4,299,920,000 pesos, meaning a loss of 23,999,298,000 pesos.
After the price of gold rose, jewelers have detected that silver has increased its demand in the state of Puebla, as it is a cheaper metal, with its current average cost being 12 pesos per gram. Following this situation, the economic spillover from silver saw a 249 percent increase, rising from 796,185,000 pesos annually to 2,786,368,000 pesos.
declared Hermilio Osorio, owner of the Rubí Jewelry Center located in the capital of Puebla, in an interview. He stated that 26 years ago, when he started in the business, he sold up to 10 kilograms of gold per day, however, currently he only sells grams.
The man mentions that in complicated years like the current ones, the sale of silver, gold-plated items, steel, or costume jewelry is what has helped him move forward. He even comments that business owners who have not managed to diversify the material of the products they sell are the ones who have had to close permanently, as has happened on several occasions within his jewelry center.
Despite this situation, Hermilio declares that the sale and purchase of gold will be an activity that will never cease to exist, as it is a business that moves a large flow of money, benefiting the state and the population.
According to Agustín Aguirre Espíndola, owner of Aguirre Jewelry, the small amount of gold currently sold in Puebla is acquired only by retail clients, that is, those who buy by the piece and sporadically. This shows that wholesalers who bought large quantities of gold to later resell it have left the business due to its high investment cost and low profit.
Álvaro Azpeitia points out that the jewelry market in Puebla did not experience a more severe drop because it was able to adapt to the new forms of digital sales demanded by the pandemic. On this, he said that entrepreneurs in the sector implemented digital sales platforms such as applications, online stores or web pages, as well as social networks.
he concludes.
The three interviewees agreed that having gold pieces at home, such as chains, rings, bracelets, or earrings, is equal to having money saved for any emergency. Therefore, they shared a series of tips for those people who need to sell their products to do so correctly.
The first step is to identify the amount of gold the piece has, which is stamped somewhere on the product under the following numbers: 8K, 10K, 14K, and 24K. The average price per gram of 8-karat gold is 473 pesos; 10-karat, 662 pesos; 14-karat, 851 pesos; and 24-karat, 1,135 pesos.
Once you know the amount of gold the piece has and the cost, the next step is to weigh the product and multiply the result by one of the aforementioned amounts. It is relevant to mention that costs change constantly, so it will be essential to look for the current price on the day they intend to sell the article, which they can do through the website Kitco.com.
With these simple tips, you will have an estimated price of the current value of the piece. However, it will also be important to go to a certified jewelry store where they buy pieces at their real value. The most efficient method is called cupellation, in which the piece is completely melted and the materials inside are separated, achieving 100 percent effectiveness.