Understanding the Price of Platinum Jewelry

February 3, 2009 by Afshin Yaghtin · Leave a Comment

Why is Platinum Much More Expensive Than Gold?

Platinum is a hypoallergenic virtually pure precious metal. Jewelry stores who sell high quality platinum offer 950 Grade (95% pure platinum) jewelry. Anything less should not be considered either pure or hypoallergenic or of substantive quality.

This means that 95% of the content of a piece of platinum jewelry is pure platinum and 5% is another platinum group alloy such as palladium, ruthenium, or iridium. Most of these alloys are excellent choices to mix with platinum jewelry, but palladium and ruthenium should be considered top choices.

In addition, unlike white gold, platinum does not require rhodium plating for maintenance.

Platinum Purity Compared to Gold

Platinum is 30 times rarer than gold!

Compared to 14k gold (which is only 58% pure gold or 14 of 24 parts gold) or 18k gold (75% pure gold or 18 of 24 parts gold), platinum can cost significantly more due to its purity and value as a rare precious commodity.

Since platinum is a purer and denser metal than gold, it will weigh more than gold (about 60% heavier).

For example, the same wedding band weighing 10.0 grams in gold will weigh 16.0 grams in platinum.

Since the amount of a precious metal (or the gram weight) is a significant factor in determining prices, platinum tends to be more costly than gold, but well worth the difference in price if it meets your budget.

Manufacturing and Labor Costs

Platinum is also more expensive than gold due to the fact that it is slightly more difficult to work with and less platinum jewelry is produced than gold jewelry, thereby effecting the manufacturing and labor costs of platinum vs. gold.

Overall, you can expect to normally pay 3-4 times more for platinum than for gold. Although with platinum prices historically lower than average, you may be able to find platinum jewelry costing closer to 2.5 – 3 times more than gold currently. Still a premium, but a bargain today regardless.

Market Price of Platinum

Platinum is a voraciously volatile precious metal whose base price is directly connected to the metal’s market price. As of today, platinum hovers at $965.00 per ounce (a historically low price that will probably change by the time I finish writing this).

In figuring out the base price of a piece of platinum jewelry, a rudimentary formula is used to determine the value (exclusive of labor, manufacturing costs, as well as wholesale and retail markup).

Platinum Formula for 950 Grade Platinum Jewelry

Market price of platinum per ounce + 18 / 31.1 = Price of Platinum Per Gram

Taking today’s price of platinum of $965.00 per ounce, this yields:

965 + 18 / 31.1 = $31.60 per gram

(Why +18 and divide by 31.1? 18 is the amount of estimated loss of platinum when the metal is refined into jewelry, and 31.1 is the number of grams per ounce).

Keep in mind that rarely should platinum jewelry’s value or price be determined solely on gram weight alone–there are many factors including design and labor, limited production of a specific piece, whether the item is handmade or mass produced, and many other factors. But this formula will give you an idea of the base price of your platinum jewelry.

For example, a ring weighing 20.0 grams of platinum may cost $1,425.00. If you divide 1,425 / 20 — you will get $71.25 per gram. That is the amount you are paying per 1 gram of platinum in your ring (inclusive of labor, retail markup, etc.).

Apples of Gold has recently reduced the prices on all of its platinum wedding bands–in response to platinum’s current market valuation. Now is the time to buy platinum, before platinum prices skyrocket as they have in times past. (Platinum used to be valued at $2,300+ per ounce just 11 months ago!) It will probably return to such levels again.

The jewelry has not changed–but the market’s valuation of the metal has–for now.

Featured 950 Grade Platinum:

Platinum Braided Wedding Band

Platinum Celtic Wedding Band

Platinum Men’s Cross Pendant

Platinum Paisley Wedding Band

View more Designer Platinum Wedding Bands from Apples of Gold.

Platinum Rings: the King’s Heavy Metal

December 13, 2008 by Afshin Yaghtin · Leave a Comment

Italian humanist Julius Caesar Scaliger described platinum in 1557 as an unknown noble metal found between Darién and Mexico, “which no fire nor any Spanish artifice has yet been able to liquefy”. King Louis XV of France declared platinum the only metal fit for a king in the 18th century. Today, platinum is still considered the most exclusive of all precious metals.

December 2008: platinum traded at nearly the same price as gold, as the rare metal plummeted to $823 per ounce, with gold closing at $822 per ounce on the same day.

While it is the perfect time to pick up that platinum diamond wedding ring for your bride-to-be, there are several reasons why it is unimaginable that platinum jewelry prices will ever breach gold’s vastly affordable price:

Platinum is a pure metal, with platinum jewelry usually being crafted in 950 grade platinum (95% pure platinum, 5% precious alloys, such as iridium, ruthenium, or palladium). Gold is usually made of 14k or 18k gold (58.3% or 75% pure). When considering precious metals’ prices, metal prices are determined at 100% purity (pure platinum and 24k gold).
Platinum jewelry is approx. 60% denser than 14k gold. Since weight plays a determinant role in pricing fine jewelry, platinum remains more expensive than gold.
Since platinum is 30 times rarer than gold and is found in only a few parts of the world, mostly South Africa, with a smaller portion in Russia and Canada, transporting platinum is more costly than gold.
Platinum mining is a difficult and time-consuming process. Ten tons of ore (rock containing gemstones and precious minerals) must be mined to produce 1 ounce of platinum.

With platinum prices down 65% since March, Apples of Gold Jewelry has lowered prices on all of its platinum wedding bands and added new designer platinum jewelry to its extensive line-up, such a new version of its best selling men’s solid gold cross in platinum. Apples of Gold expects to add more platinum jewelry to its collection in 2009 and 2010; especially since platinum is–for now–exhibiting signs that it will adhere to Apples of Gold’s value-based jewelry pricing methodology.

Related Posts:

Platinum and Gold: When Metals Collide