Thesis (the 2nd Draft)

Sustainable Jewelry

By Song Hee Lee

Introduction

A gold ring on your finger may be priceless as a symbol of eternity. The method of producing a gold ring certainly costs far more than the worth of the metal. To produce just one gold ring, 20 tones [spelling?] of waste are generating and an ever-lasting ecological footprint will be left the ground. Gold mining is one of the dirtiest industries in the world because [and ???] it is certainly costing the entire planet and indigenous people who once lived there. [I don’t understand your reference to indigenous people here] (No dirty Gold, n.d.)

Gold has been an icon of power and wealth in the history of throughout the last 6000 years. Gold ever mined by 2006 is accounting [accounts for ] for 158,000 tones and 90% of the amount was produced since 1848. According to an industrial journal, around 70% of the gold demand is for jewelry and less than 11% is for industrial purposes (World Gold Council, n.d.). Because of its high value, gold has always been recycled ever since it was found from the pre historic times. Even today, approximately 15% of annual gold consumption is recycled and the recycling rate is expecting to increase with climbing of the prices and higher demands in the fashion industry.

Although gold is getting more expensive, there is a trend towards high turnover of jewelry designs and affordable prices. The conception [wrong word] toward jewelry is also changing from the ways of investing money or money laundry [wrong word] to seasonal fashion items along with the current fashion trend of “disposable chic”(Sarker, 2005). Usage of gold to make into jewelry is also changing a creative way because people consider more of the color and design than the proportion or weight of gold and quality of precious stones. Once consumers become conscious about the material costs that are getting higher, and the environmentally hazardous gold mining procedure, there will be a huge possibility of recession in jewelry industry in near future.

To overcome all of these issues, recycling gold is one of the ways to make the industry sustainable along with creative ways of designing such as containing less gold and using alternative materials. Also easy accesses to recycle gold and reuse it for new jewelry for public and adequate campaigns for the practice by merchants will be necessary. Because it is getting obvious that only environmentally keen companies with innovative designs can get credits from customers who aware the green movements of industries in general with design evolution which minimize the carbon emission rate.

History of Gold mining industry

Over 6000 years old gold mining history is divided into two eras; before and after the California gold rush in 1848. Around 10,000 tones, which are about 10 % of total world’s gold, found before the time, and more than 90% were excavated after 1848 (World Gold Council, n.d.).

In 2000 B.C., Egyptian started to mine gold less than 1 tone annually, and more than 5~10 tones was produced under Roman Empire. The amount fell back to one tone during the Dark and Middle ages (500 – 1400AD). South America is famous for the high standard of gold smith’s art works throughout the period. In the 15th century, Ghana in West Africa became the important source of gold, where was a producing 5-8 tones annually, and Mexico and Peru joined a further source by the Spanish conquerors. Total around 10 tones of gold were produced from the areas by 17thcentury. Additional 25 tones of annual production started to come from Russia and, the output reached 30 – 35 tones of the world total of 75 tones by 1847(World Gold Council, n.d.).

The crucial turning point in the gold mining history was 1848, when the California gold rush started and it changed the whole dimension of gold mining process forever. Total 300 tones of gold including Austrian production discovered in 1852, and the production lifted even higher after finding of the huge gold deposits in the South Africa where has been the source of 40 % of world’s gold ever produced in 1886. Two more gold rushes arose in 1893 and 1903 in Australia and after the discovery of alluvial deposit in the Yukon territories of Canada in 1896. World’s average production became 400 tones annually by the twenty century (World Gold Council, n.d.).

Current Gold mining Industry and market

Through the twenty century, the gold mining became the declining industry and there were only short revivals with the price rising in the late 1930’s. In 1980, the dramatic price change hit the price of gold, and the industry had to undergo another revolution of a new era. The world production became double during the 1980 and lifted up to 1,744 tones in ten years later. New technology in the process of mining, milling and recovery also contributed to the development of gold mine. For instance, a gold mine in Nevada, USA, once considered uneconomic, which produced over 60 % of US production in the late of 1980s (World Gold Council, n.d.). During the 1990s, the industry has been struggling with lower gold price and strong environmental controls. Industry expects that the period of rapid growth is over along with the stable production rate in worldwide around 2500 tones of annual production (World Gold Council, n.d.).

Gold jewelry considered as an investment in history, and jewelry is sold by weight at the current daily rate, especially in markets such as India and Middle East (World Gold Council, n.d.). Industry experts believe that there are enough gold above ground to satisfy all demands of the jewelry for the next fifty years in the form of old and unused jewelry (Green Karat, n.d.). Since gold is valuable material to provoke higher participation in the recycling practice, incentives and campaigns of recycling gold for public are needed urgently to prevent all of the hazardous environmental an socio-economic impacts from gold mining all over the world.




Demand and Supply in Gold Market


Supply and Demand




Retrieved from http://www.invest.gold.org/sites/en/why_gold/demand_and_supply/

The GFMS Ltd. estimates that around 70 % of gold in demand over the world is for jewelry, 11% is for industrial purposes such as dental and electronics and 13% is for investment purposes for institutional and individual collections in the forms of bars and coins. Even though the demand for gold is widely spread around the world, Especially East Asia, the Indian-sub-continent and the Middle East, took 70 % of world demand in 2005. 53% of world gold demand is also devoted to just five key consuming nations such as India, Italy, Turkey, USA and China. Each market has different socio-economic and cultural factors consuming gold and generating new patterns of demand along with rapid demographic (World Gold Council, n.d.). In 2006, gold demand for jewelry amounted to US $44 billion (2,284 Tones), which accounted for 70 % of world gold demand. Along with the history, jewelry manufacturing is one of the largest industries in consumer goods and the USA is the world largest market for gold jewelry and India is the biggest consumer in volume wise.

From the chart above on the left, above-ground stocks represented a total quantity of approximately 15,800 tones, of which 64% had been mined since 1950 (GEMS Ltd, 2006). The Official sectors in above-ground category is including reserved gold by central banks, government bodies, and supranational organizations.

According to the Supply flow chart, the demand of gold meets each year from the mine production (61%) and the recycling of metal (25%). The diagram on the right above shows that the largest source of recycled gold is jewelry scraps, followed by sales of gold by central banks and recuperated electronics components over the past five years. Identifiable investment demand significantly increased in 2005 and up 25% in 2006(World Gold Council, n.d.).


Gold and today’s financial value

• Current price of gold and economical market research

• Gold as not a monetary value any longer


Annual Average Price of Gold (1900-2006)




Gold Price, $ per Ounce



Environmental Impact of Dirty Gold

According to a “Dirty Metal” report by Earthworks and Oxfam America (2004), two third of the gold in use are newly mined and two third of the newly mined gold are from open-pit mines because of the easy mining process than underground mines. The size of some craters of open-pit mines is as big as to see from outer space and the cumulative solid wastes generated from the gold mining process are 79 tones for every ounce of gold through the extraction process. Gold uses cyanide to extract from soil, which technique called “heap leaching”. The result of gold-cyanide solution contaminates the surrounding environments seriously. A small grain size of cyanide is fatal to humans and the water containing the poisonous acid can be fatal to fish. The report defines that some mines are using several tones of cyanide everyday and the cyanide-contaminated waste ore is usually abandoned, which ruins lands and poisons waters (Dirty Metals, 2004)

“On-site tailings disposal” and “Riverine tailings disposal” are common way to dispose the by-products through extraction. Tailings are form of “semi-solid suspension of pulverized rock in water laden with toxics”(Dirty Metal, 2004). On-site tailings disposal consists of continuous bulldozing dried tailings into dam and the dam is periodically getting bigger as the tailings reservoir is growing. The tailing dam failures have brought most of the major mining accidents such as releasing cyanide-laden tailings into rivers in the past 30 years. Riverine tailings disposal is direct pump of the mines waste into the nearest water bodies such as dumping mine wasted into rivers and oceans, which causes poisoning of aquatic ecosystems, disrupts the entire watershed, and sometimes clogs rivers. It has been completely prohibited in the developed countries, but it is illegally practiced in elsewhere in developing countries (Dirty Metal, 2004). In response to the public concern, deep-water disposal which is releasing tails into considerably deep ocean more than 500 meters is considered to be the best practice by industry. But it is remained highly controversial because of lack of information about ecology disruption in the ocean floors at this point. Even though World Bank and other developed countries effectively ban the practice, marine disposals are still using at currently developing mines (Dirty Metal, 2004). Mining needs large amount of fresh water in every aspect of the operations such as drilling, dust control, grinding and etc. Too much pumping from ground water for the industry use causes the disrupting water sources at the same time (Dirty Metal, 2004).

Besides the water pollution, mining consume 7 to 10 % of annual global production of energy. It is considered to be one of the most energy-intensive industries in the world. A metal from the ore process at the mine is not pure form and further refining process is necessary. Even though Smelting technology has been improved through the history, smelting process produces significantly great amount of toxic air and causes acid rain. Worldwide, the smelters add about 142 million tons of sulfur dioxide and other pollutants to the air annually which accounts for 13 % of total global emissions.
They also release substantial quantities of greenhouse gases such as carbon dioxide and perfluorocarbons (PFCs) during the smelting process (Dirty Metal, 2004).

Social Impact of Gold Mining [YOU NEED TO RELATE THIS MORE CLOSELY TO YOUR TOPIC]

Most of the gold mined from 1995 to 2015 is expected to come from native land of the traditional territory of indigenous people. Usually most of indigenous people live isolated from the main society and there are no legal protections or political safeguards for the people. Thus, there is no clarification of ownership for the land and indigenous people are often threatened and forced to move by government that sold the subsurface right to the mining corporation (Dirty Metal, 2004). Not only the indigenous people but also local communities who once considered the mining as an economic opportunity have to bear the loss of traditional livings, and deterioration of public health (No Dirty Gold, n.d.). There are also numbers of social problems growing followed by displacements of local people who were farmers, as well as fundamental changes of a character of the place. Once the mining stops, all of the villagers become struggled under the financial and political unstableness along with the environmental damage cost which they eventually have to absorb (No Dirty Gold, n.d.).

• Corporate Violence

• Women’s right

Fashion trends in jewelry [THIS SECTION SEEMS UNCONNECTED WITH YOUR TOPIC-LET’S DISCUSS]

As fine jewelry takes an important role in the fashion industry, the design turnover in jewelry becomes faster and faster. It is extremely hard to remain the business if the firm doesn’t invest in innovative design and doesn’t developing new materials. Recently, famous designers and high fashion brand companies have added new jewelry and watch lines as joint ventures in designing, manufacturing, and distributing with luxury jewelry manufacturers. So far, Richemont and Polo Ralph Lauren agreed to form a new business, famous wedding dress designer Vera Wang launched her jewelry line successfully, and Ivanka Trump, a fashion model and heir of Donald Trump opened a fine jewelry store in New York City. According to the marketing tips for Fall 2007 from JCK style magazine editors Carrie Soucy and et al.(2007), jewelry designers and manufacturers have to really pay attention to the upcoming fashion trends and “Make Your Store Fashionable”. Also they emphasized that understanding relationship between fine jewelry and future fashion trend is the most critical part to boost the sales up. The tones of new season and styles including knowledge of clothing are essential factors to determine the silhouettes and color of newly designed jewelry. [BUT THIS DOESN’T ADDRESS YOUR TOPIC- SUSTAINABLE JEWELRY]

Currently, there are several distinct growths in jewelry market such as female self-purchasers, celebrity jewelry trends, demand on men’s jewelry, and the consumption of silver as an alternative metal for gold. Self-purchasers are the biggest opportunity for jewelers who were once neglected from the traditional jewelry environment and the reason that those self-purchasers look to them for the most current and fashionable shapes and colors generated by stylish celebrities makes celebrity marketing inevitable (JCK style, 2007). As the personal electronic appliances become the hottest fashion icons, alternative metals such as titanium and non-traditional materials such as leather, wood, and plastics are getting popular especially in men’s jewelry. More futuristic and industrial looking accessories by new alternative materials will be gained attentions from i-pod generations. Silver becomes the favorite metal among designers because of the relative affordability, strong trend of blackened metal, and freedom to choose new fine materials. Silver and gemstones are pretty good option for self-purchasing women who want to create stylish look with reasonable prices and modern accessories for men(Silver Sizzle, 2007).

The price of gold hit $800.00 per ounce in 2007, which is 10 times more expensive than 1970s. Industry experts analyze that there is huge possibility that the price will go even higher. Even though in some countries gold is treasured as a form of saving, gold jewelry are mass-market products and jewelry fabrications are the keystone to success in most of the countries. A symbol of power and wealth is transforming fast into a fashion and style, and craftsmanship and design is the most important issues in jewelry than the quality and weight of fine materials.

Currently, jewelry is getting lost its value as an investment purpose. Traditionally gold price has moved reversely from the economic condition, thus people invest on gold when the financial distress is expecting. But it is not a right theory any longer. Even liquidating estatic jewelry is extremely hard and it is common that you will get only scrape value of the jewelry or less than one third from the original price. If annually consuming gold is from newly mined and most of them are consumed for jewelry, there are enough reasons to encourage the recycling of old gold to recreate those scraps into the most decent designs to adore them as well as saving the high material cost and the environmental cost which everybody has to get burdened.

No dirty gold practice

Gold is an indestructible material that is easy to recover, refine, and reuse. It is believed that all the gold ever mined still exists somewhere on the earth in any some forms of old jewelry, bars, coins and electronic components. Nowadays, the usage of recycled gold or scraps is only 25% of the entire demand. Historically, the supply of recycled gold largely depends on the price of gold with ups and downs of economic circumstances. For instance the supply raised under economic recession and inflation. But the supply of recycling gold can be largely changed by the will of people.

In 1998 during the Asian [financial ?]crisis, the South Korean economy struggled with serious financial problems from a shortage of foreign exchange. At that time, Iindividual households participated in a the gold collection campaign and contributed to save [saving] the nation’s economy. As a result a total of 300 tones of gold (an average of 65 grams per household) were collected and exchanged for bonds in Korean currency (World Gold Council, 2007). The chart shows the supply of scrap over last ten years, and the peak in 1998 was the result of the will of Korean to save their economy. [THIS IS INTERESTING, BUT IS IT GLOBALLY RELEVANT?]



• Social Activities around gold




Conclusion

• Restate the summary of body

• Benefit of recycle and reuse gold