Gold prices are soaring on the local market. Already on the rise recently, under the effect of the rise in the international price of the yellow metal, these prices recently experienced an abnormal jump, disrupting the smooth functioning of the market.
Asked by Le360professionals in the gold sector in Morocco affirm that this recent surge in prices has nothing to do with the evolution of the international market. They rather attribute it to a movement of speculation, fueled by rumors circulating, particularly on social networks.
These rumors, explains Driss El Hazzaz, president of the Moroccan Federation of Jewelers, suggest that the price of gold should reach 1,000 dirhams per gram before the end of 2024. This has led to a sharp increase in demand, both from individuals and professionals, seeking to anticipate this supposed increase in prices.
What commodity sellers saw as an opportunity not to be missed. They have in fact made significant increases in their prices, in a completely unjustified manner, according to the jewelers. “The raw material increased from 80 to 90 dirhams per gram», declared Mokhtar Kerroumi, president of the Association of artisan jewelers of the Casablanca-Settat region. This propelled prices to record highs in a very short time, according to professionals.
«We have reached levels where the 18-carat raw material trades at more than 760 dirhams per gram, while the international price is around 620 dirhams. There is therefore a difference of almost 140 dirhams per gram compared to the international market, which is totally abnormal.», deplores Mokhtar Kerroumi.
«Such a gap with the world price is unheard of», insists Anouar Aït Mansour, jeweler, also pointing the finger at the speculators.
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Certainly, jewelers have other sources of raw materials, but these sellers, who import gold bars, remain their main suppliers which they cannot do without, according to professionals.
Thus, indicates Driss El Hazzaz, the recycling of old jewelry only meets demand to the tune of 15% to 20%, and the use of imports faces restrictions. In fact, shippers of this raw material cannot send more than 30% of its value, with a limit set at 18,000 dollars.
However, he underlines, foreign companies approved by Customs demand full payment, arguing that the price of gold is very volatile and that their margins are low, which requires a waiver from the Foreign Exchange Office. .
Customers inhibited by prices
As for Moroccan mining operators, continues the president of the Moroccan Federation of Jewelers, they export all of their production because of the tax advantages they benefit from. In fact, he explains, they are only taxed at 17.6% compared to 30% if they sold their production on the national market. Moreover, he specifies, these are unrefined semi-finished products.
The repercussions of this surge in prices are quickly being felt in the daily lives of jewelers, who complain of the erosion of their margins. These increases also have a direct impact on consumers. With sales prices for gold jewelry starting at 770 dirhams per gram, and reaching 1,000 dirhams depending on the final product, buyers are increasingly hesitant to take the plunge.
Omar Sadouq, jeweler in Casablanca, reports a significant drop in traffic in his store: “The rise in prices has led to a real drop in attendance. Customers, already affected by the current economic situation, can no longer afford to spend as much.»
Read also: Gold hits a new record, above $2,609 per ounce
This situation is particularly worrying for jewelers, who find themselves caught between increasingly high supply costs and consumers less and less inclined to buy at such exorbitant prices. Their margins, already thin, continue to shrink, threatening the survival of many companies in the sector. According to Driss El Hazzaz, more than 285 artisans operating in the gold market were forced to close their doors.
Facilitate importation to curb speculation
Faced with this uncontrolled surge in prices, jewelers boycotted local suppliers for a week, which began to bear fruit, according to them. “Prices are starting to stabilize, they fell by 70 dirhams after the boycott of the purchase of raw materials», explains Mokhtar Kerroumi. This boycott, launched by many jewelers across the country, aimed to curb demand and force speculators to lower their prices.
However, this action, although temporarily effective, will not be enough to resolve the underlying problem. Jewelers are now calling for more sustainable measures, in particular by facilitating the importation of raw materials.
«We request the facilitation of import operations to counter this increase in raw material prices.», suggests Mokhtar Kerroumi. This measure would increase supply on the market, making speculation less influential and giving professionals some control over prices.
Par Fatima El Karzabi et Khadija Sebbar
10/19/2024 at 12:59 p.m.
