Good times tor gold retinenes

Press, 17 July 1980, Page 14

Good times tor gold retinenes

By

Liesl Graz

in Geneva. "Here’s a lot from the Gulf. It looks as though someone has sent in the palace plate.” The speaker is my guide around one of the four very specialised Swiss enterprises that between them refine almost half the world’s gold and a good part of the silver. Business has been very, good this year. The three largest refineries belong to the “Big Three” of commercial banking: Metaux Precieux in Neuchate! to the Swiss Bank Corporation, A-rgor in Chiasso to the Union Bank of Switzerland, and Valcambi, also near Chiasso, to Credit Suisse. The fourth, Usine Genevoise de Degrossissage d’Or (U.G.D.0.), recently acquired by the Banque de Paris et des Pays Bas (Suisse), is considered an outsider by the others. The refineries make bars of gold to order for their parent banks — the famous “four nines,” which are 99.99 per cent pure. They also turn out “10 tola” bars, the staple of the age-old trafficking between Dubai, Karachi and Bombay, dormant at the moment because of an Indian Government crackdown.

Jewellers’ gold is made to specifications which vary with regional taste. East of Suez there is a definite preference for a , slightly more reddish hue than that used in Europe; a little more copper in the gold mixture. Some of the factories produce semi-finished watch cases and bracelets, chemical or industrial products, anything from wires to silver nitrate solutions. “As long as a precious metal is involved, we’ll make it,” said one of the directors in Neuchatel. Floor sweepings are carefully preserved; great bins of rags also come in, mostly from chemical plants where gold or silver solutions are used. At current prices, it is worth washing out even the minute amounts caught up when machinery or working areas are wiped clean. Most new gold comes from South Africa; the Soviet Union refines its own. About one-seventh of refinery output is turned into bars for investment or reserves. Of the rest, about 70 per cent goes into jewellery and watches, and the remainder is used in dental work, the electronics or chemical industries, or for medals. The medal market has not been very good in recent years and the 200 “gold” medals handed out in an Olympic

year (gold-plated, anyway) are not going to reverse the trend. . The recent spectacular rise in the price of silver resulted in a rush to sell family heirlooms, sometimes precious relics of the silversmith’s art. By the time the art world raised the alarm, it was already too late for many rare objects. Squashed into bales, they arrived for smelting from all over the world. With tons of precious metal around, the refineries inevitably take precautions. At Valcambi, nestled againts the Italian border, they are quite strict. Executives always refuse to have their pictures taken, and highlevel permission is needed before photographs can be. taken inside the plant. (It always includes the proviso that workers put on dark glasses.). Further from the troubled Italian climate, security is less obvious. In Neuchatel, a visitor is given a badge and accompanied, but there are no body searches for him or for workers. ' The ( cameras for the closed-circuit television are less obtrusive than in a supermarket, and exterior protection is just as discreet. In several generations, there have been only minor attempts at robbery.

As prices go up, sizes come down. This year Credit Suisse asked its refinery to produce a new standard gold

bar weighing one gramme. Owners may need an eyeglass to see it, but the “four nines” mark will be on each

one, just as though it weighed a kilo. Copyright, London Observer Service.