How Jewelry Companies are Coping with Record-Breaking Gold Prices

Over the past year and a half, the jewelry industry has had to contend with skyrocketing gold prices. In January of 2024, gold value circled $2,000 per ounce. Considering the previous five years, that number was certainly high, but not outlandish. 

At the start of April 2025, that value has ballooned to $3,100 per ounce, a milestone not previously reached. It is an extraordinary increase that has forced jewelry designers to make quick, sometimes drastic, changes to existing inventory and alterations to design templates for new pieces. At the AGTA and GJX Tucson Gem Shows, sellers discussed how their businesses are coping with the new reality. 

Extreme Unease

The first topic that needs to be addressed is how the inflation of gold value has affected the mentality of sellers. Of the individuals asked about this topic, about half offered information and insight but requested to stay anonymous. It is important to understand that this silence was not because they are hiding anything. That bears repeating - designers and sellers are not doing anything unethical or deceptive to sustain profit margins. They are dealing with a stark reality that has emerged at a pace no one can keep up with, and whose future is far from certain. No one knows if the changes that they have implemented are temporary or if further adjustments will be needed in the coming months and years.

In response to the record-breaking price of gold, sellers have come up with the same several ideas to keep their inventory affordable while maintaining a profitable business: altering existing jewelry designs, employing existing gold plating techniques while improving on them, purchasing gold from countries with ample deposits, and choosing to pivot away from gold jewelry entirely. 

Commercial Market Level is Most Deeply Affected

Before jumping into the modifications that people are making, we should say that the various market levels are affected by the price hike differently. The sector hit the hardest is the mass-produced market using 10kt and 14kt gold alloys. 

Sanjeev "Sunny" Khamesra, director of Mewar Jewels, a company that specializes in 14kt gold jewelry, sells to both retailers and private individuals. He maintains that single sales have remained at a stable pace. The market level that he has seen most deeply affected is the wholesale business. Khamesra said that the issue of high gold prices is something he can't ignore, and it has forced him to raise his prices accordingly, which impacts the large-scale purchasers the hardest. 

At the other end of the spectrum, Tarak High Karat Gold sells what its name suggests, high karat gold jewelry. Jack Shargel explained that their jewelry is made from 18kt, 20kt, and 22kt gold, with some pieces featuring multiple alloys. In addition to high-purity gold, Shargel stated that their jewelry often includes complicated granulation and piercing techniques that can only be executed by highly trained artisans. They cannot be mass-produced, nor are they intended to be. Shargel said that the Tarak High Karat Gold clientele has always been individual buyers who are looking specifically for high-quality jewelry and are willing and able to pay for it. This type of customer, Shargel stated, has been less impacted by the necessary price increase, and his sales have remained consistent. 

Enrique Garcia of Rosario Garcia Designs also provides high-end pieces made from 18kt gold that are entirely hand-fabricated. Like Tarak High Karat Gold, Rosario Garcia's clients are typically looking at individual items, rather than placing a large order, and have always understood that this kind of jewelry is costly by nature. Having been in business for more than three decades, Garcia expressed relief about purchasing gold before prices got unreasonably high. "For the moment", he said, "we are not buying gold and are waiting to see how the market develops." This was a sentiment that was expressed by several well-established companies that have had the luxury of time to build up a stockpile of gold.

Changes to Existing Jewelry Templates

In an effort to keep jewelry affordable, some manufacturers are modifying their designs to minimize the amount of gold used in any given piece. Khamesra explained that he has tasked Mewar Jewels' CAD designers to alter their templates to reduce the amount of gold used where possible, but stressed that he refuses to accept any changes that make his company's designs any less beautiful or durable. 

A representative of a company that requested not to be named said that they are also adjusting their 14kt gold jewelry designs to use less gold. Specifically, they spoke about hollowing out pendants. Unfortunately, even with this modification, prices are still up, resulting in some regular clients purchasing 75% of what they normally order. 

Interestingly, there is one type of jewelry that uses only a tiny amount of gold - stud earrings. The only gold needed for studs is the bar and the setting, as the gemstone is the star. Kostbar International specializes in studs, and co-owner of the company, Rebecca Helmich, noted that they have not been affected by the change in gold price. She does not predict that she will need to make changes to her inventory, saying, "People will always want studs". 

Not Your Typical Gold Plating Technique

Gold plating, the process of coating a metallic object with a thin layer of gold, has been around for two hundred years. The layer of gold can be built up to 2.5 microns thick, but many pieces are covered by only a single micron. Using a thin layer of gold allows you to create jewelry that has a genuine golden color and sheen while remaining very affordable. 

Turkish-based company Kurtulan has found a middle ground between thin gold plating and solid gold fabrication. General manager Keren Kurtulan described how his father developed a technique ten years ago that they call "gold fusion". The goal was to develop a new way of coating that was thick enough that design details could be put on the gold (something you can't do with traditional gold plating), and would never be at risk of rubbing off. Ultimately, Kurtulan found a way to create a layer of 24kt gold that is an impressive 25 microns thick.

Kurtulan has clearly hit a winning formula. The company now has a library of over 20,000 designs and employs 50 goldsmiths.

Gold Nuggets

When purchasing jewelry, most people don't pause to think about where the gold came from. Most of the time, sellers themselves don't know where their gold is sourced. This is largely because gold is gold, regardless of where it came from. However, there is a small group of raw gold nugget collectors who do care about the country of origin. 

Orocal sells unprocessed gold nuggets. Charles Conner, the operations manager of the company, and his son Dylan take great care to keep their gold nugget inventory separated by country, and they spoke about how different sources have distinct ebb and flow in terms of production rates. Australian gold, for example, can be mined year-round. Alternatively, the flow of Alaskan gold is greatly restricted in the winter months, as the frozen ground hampers mining activity. 

Since Orocal is involved in non-processed gold, they have not been as drastically affected by price hikes as jewelry retailers who have to pay for the refining and alloying processes. When asked about predictions of the gold market, Charles offered a carefully worded conservative response - "We are at the very beginning of the race." 

Some Businesses Forced to Abandon Gold Entirely

For some, the increased value and unpredictability of the gold market have caused them to turn away from the metal entirely. Sam Mulani, CEO of Reko Settings, remarked that he had to stop carrying gold jewelry last year due to the expense, and now only stocks silver items. Fortunately, Mulani says that Reko Settings has retained the ability to fill custom orders for gold pieces, but they no longer keep finished jewelry on hand. 

Lynn Zeng is a representative of Standout Design, a company that continues to offer both 14kt gold jewelry as well as silver pieces. She said that she is aware of several companies that have made the decision to carry silver jewelry exclusively. Sellers, she observed, seem to be splitting into two groups: those creating high-cost, high-karat gold jewelry made with particular clients in mind, and others who are abandoning gold entirely in favor of silver or other metals, who can fill large-scale orders. When speaking about her 14kt gold jewelry, Zeng said that her customers are "buying less and choosing to be more conservative." 

^{Standout Design offers both 14kt gold jewelry (left) as well as silver items (right)}

Gold Prices Impacting Sales of Synthetic Diamond Jewelry

While exploring the GJX show, I happened to overhear an extraordinary exchange between a buyer and seller that, even last year, I would have had a hard time believing was true. A woman was looking at synthetic diamond jewelry and balked at the price of an item. She was upset because she expected lab-grown diamond jewelry to be less expensive, and she spoke about seeing comparable jewelry in the past for notably less money. The seller explained that it was not the stones that made the item more expensive than it would have been at previous shows; it was the gold. Ultimately, the lady walked away deeply frustrated without making a purchase. 

What the Future May Hold

Truly, no one knows how gold values are going to behave going forward. Concerns are heightened by the current chaos of the international trade markets, and the indication is that the political pandemonium will continue for the foreseeable future. That being said, the theory proposed by Zeng at Standout Design makes sense. Just as the diamond market has largely split itself into two tiers - high-cost natural diamonds and low-cost synthetics - she expects the gold jewelry market to do the same. Certainly, 14kt middle-market gold jewelry will continue to be available because there will always be demand, and no one is saying that it will disappear. However, dealers need to make some hard decisions about the types of jewelry they keep in stock that will allow them to keep their businesses healthy. What is certain is that people at all levels of the gold market are wary of placing large orders until some consistent trend emerges. It is just too risky.