How is Gold Refined from Scrap

Understanding how gold refining works

Gold has always been a big part of India’s culture and economy, and its value goes far beyond just looking beautiful. To make sure gold is genuinely pure, it goes through a careful refining process. This step is important because purity directly affects how much the gold is worth, especially when it is used for things like gold loans. Whether the gold comes from mines, old jewellery, or scrap materials, it is purified using detailed methods until it reaches the required carat level, from 14k to 24k. Knowing how gold is refined and how purity is measured helps you understand its true value and make better decisions when buying, selling, or assessing gold for financial use.

How is gold refined to achieve purity?

Refining gold is basically a deep-cleaning process that removes anything that is not pure gold. One common way to do this is the aqua regia method, where gold is mixed with strong acids that break it down and separate the impurities. The mixture is then filtered, and a chemical is added to slowly bring the pure gold back out of the solution. Another method is electrolytic refining, where electricity helps pull pure gold to one side while the unwanted bits stay behind. Once the refining is done, the gold is melted and shaped into bars or other forms. These steps usually help gold reach about 99.5% purity, making it clean and valuable.

How to purify gold to a higher grade?

If gold needs to be even purer, it goes through more advanced refining. One popular method is the Wohlwill process, which uses electricity to push purity levels all the way up to 99.99%. This is great for turning already refined gold into investment-grade metal. Another option is chlorination, where chlorine gas is passed through melted gold. The gas reacts with impurities, which can then be removed easily. Gold that reaches such high purity becomes very soft and smooth to work with, making it ideal for bullion, premium jewellery, and other high-value uses.
 

Methods to refine gold from 14k to 24k

When you want to turn 14k gold into completely pure 24k gold, the main goal is to remove all the extra metals mixed into it. Here is how it is usually done:

• Understanding the mix: 14k gold has about 58.5% pure gold and the rest is metals like copper, nickel, or silver.
• Aqua regia method: The alloy is dissolved in a strong acid mixture, and then pure gold is brought back using a reducing agent.
• Cupellation: The alloy is heated at very high temperatures so the mixed metals oxidise and separate, leaving the gold behind.
• Final testing: After refining, the gold is checked to confirm it has reached 24k purity before being shaped or cast.
   

PRO TIP: Get the value your gold deserves. Check your gold loan eligibility and see how much you can avail based on purity and weight.

Techniques to purify gold from scrap

Purifying gold from scrap items like old jewellery or electronics is all about carefully separating the gold from everything else. Here is how this process usually works:

• Initial separation: Scrap pieces are broken down using acid treatment or melting to pull gold away from other materials.
• For electronic scrap: Aqua regia or other chemicals dissolve the gold, which is then filtered and recovered using a precipitating agent.
• For jewellery scrap: Cupellation is used to melt the gold and burn off impurities at high temperatures.
• Further refining: Once the gold is recovered, it may go through electrolysis or chemical treatments to reach higher purity levels.

These steps help turn scrap gold into clean, valuable, and reusable pure gold.
 

Why does gold need to be refined?

Gold needs to be refined to ensure its purity and enhance its value. Raw gold often contains impurities such as silver, copper, and other base metals, which can reduce its market worth. Refining eliminates these impurities, resulting in gold that is 99.5% pure or higher. This pure gold is highly sought after for investment purposes, jewellery, and industrial applications. Moreover, refining gold ensures that it meets international standards, particularly important when using gold as a form of collateral for loans or trading on the global market. By refining gold, its true value can be accurately assessed, providing a fair valuation for buyers, sellers, and lenders alike.
 

How raw gold is found and refined?

Raw gold is typically found in natural deposits such as rivers, streams, or deep within the earth's crust. It is often extracted through mining operations, including placer mining, where gold is sifted from river sediments, or hard rock mining, where veins of gold are blasted from underground. Once extracted, raw gold contains a variety of impurities, including other metals and minerals. To refine it, the gold is first melted and treated with chemicals like nitric acid or chlorine gas, which remove the impurities. Smelting is another method, where the gold is heated to high temperatures, and the base metals are separated. The final result is purified gold, ready for commercial use or further refining into bullion or jewellery.
 

How to extract pure gold from scrap materials?

Extracting pure gold from scrap materials involves various chemical and mechanical processes. For gold-bearing electronics, the scrap is first dissolved using aqua regia or cyanide solutions, separating the gold from other materials. The dissolved gold is then precipitated out using a reducing agent, like sodium metabisulphite, and refined further if necessary. Another method, often used for jewellery scrap, involves cupellation, where the scrap is melted at high temperatures to separate the gold from base metals. The remaining gold is collected and refined further using electrolysis or chlorination, depending on the required level of purity. This purified gold is then either sold, reused in new jewellery, or stored as an investment.
 

Gold refining and its role in gold loan valuation

Gold refining plays a crucial role in determining the value of gold when used as collateral for loans. Lenders require gold to be of a certain purity to assess its true value accurately. Gold that has been refined to a higher purity, such as 24k, fetches a higher valuation compared to lower-purity gold. In the context of gold loans, the lender typically tests the purity of the gold offered as collateral before determining the loan amount. The more refined and pure the gold, the higher its market value, which directly impacts the loan valuation. By ensuring the highest possible purity, borrowers can secure a higher loan amount.

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How does gold refining affect the gold loan amount?

The purity of gold is one of the most important factors that affect the amount of a gold loan. Banks and financial institutions typically assess the purity of the gold before determining its market value and the loan amount they are willing to offer. Gold refined to 24k purity commands a higher value than gold that is only 18k or 14k. When a borrower presents refined gold with minimal impurities, it allows lenders to offer a more favourable loan-to-value (LTV) ratio. Conversely, gold with impurities or of lower purity will reduce the loan amount. Therefore, having well-refined gold ensures the borrower can access a higher loan amount.
 

Refining gold for the maximum loan value

To maximise the loan value, refining gold to its purest form is essential. Lenders determine the value of the gold based on its purity, and the higher the purity, the better the loan terms. For instance, gold that has been refined to 24k purity is worth significantly more than gold with impurities. To achieve maximum loan value, borrowers often refine their gold using methods like electrolysis or chlorination to ensure minimal contamination. Once refined, the gold is assessed by the lender's experts, who will calculate its worth before approving the loan amount. The higher the purity of the gold, the more favourable the gold loan terms are likely to be.