Did you know where Gold flows in streams!!

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In no other country in the world is as much gold processed as in Switzerland. Why is that? And what about dirty gold? The Metalor refinery near Neuchâtel opened its doors to us.

The enormous heat can still be felt at a distance of five meters. The liquid gold, which is poured into ten molds from a large, glowing crucible in front of our eyes, is 1200 degrees hot.

The workers wear insulating suits and visors that completely cover their faces. Carefully pour out the gold and remove the molds at the end. Large, shiny golden bars appear, which now quickly cool down.

Already cooled bars rest on a table next to the foundry, about 40 pieces, they all weigh between eleven and twelve kilos and are each worth around 600,000 francs.

We marvel at the approximately 24 million Swiss francs that lie so casually as if they were just chocolate wrapped in gold foil. But you need both hands to lift such a bar.

We are in the production halls of Metalor Technologies SA in Marin near Neuenburg. Metalor is one of five large gold refineries in Switzerland. In Marin alone, the company processes around 250 tons of gold per year, as well as 300 tons of silver and around ten tons of platinum and palladium.

GOLD HUB SWITZERLAND

In addition to the large ingots, Metalor produces a lot more: gold laminate, which is processed by the local watch and jewelry industry, small ingots that can be bought from the banks, salts, and electrolytes for industrial use, including silver powder for solar panels.

“The number of products in which precious metals play a role is generally underestimated,” says Antone de Montmollin. The 58-year-old grandson of a winegrower, who was a Red Cross delegate in war zones when he was younger, has worked for Metalor since 2005 and has been running the company since 2009. “Gold can be found in every smartphone, every car, every TV set, but also in cosmetic and pharmaceutical products.”

And in Switzerland there is a huge gold hub – the material comes into the country, is refined by one of the five large refineries, and leaves the country again. most of it anyway. With exact numbers it is difficult. “It changes from quarter to quarter based on demand,” explains Montmollin.

Basically, gold comes to Switzerland in two forms: directly from mines, where it was freshly mined, or as an already refined material that is to be recycled or refined to a higher quality. This also includes a lot of bank gold, which is transported back and forth between Switzerland and the custodian banks based in London and is regularly reprocessed so that it can be reused industrially. Around 15 percent of all mined gold is refined in Switzerland, says Montmollin, referring to statistics from the London Bullion Market Association. And even 70 to 80 percent of the world’s recycled gold.

IN BUSINESS SINCE 1852

Marc Ummel, responsible for raw materials at the Swissaid aid organization and a long-time observer of the gold industry, estimates that “more than 50 percent” of all the gold traded in the world flows through Switzerland. In total between 2100 and 2700 tons per year. “On the one hand, there are historical reasons,” explains Monmollin, “we’ve simply been in this business for a very long time.” Metalor was founded in 1852 and belonged to what is now UBS for a long time until it sold the company in 1998. Today the company is part of the Japanese Tanaka Group, which also specializes in precious metals.

Most of the other large refineries now also belong to foreign groups. And all are in Romandy or Ticino-once settled there because of the watchmaking industry in western Switzerland and the jewelry industry in northern Italy.

Another reason for the importance of Switzerland is the quality and the reputation says the Metalor boss. A special feature is the “sworn precious metal testers”, who are employed by the refineries but carry out a federally certified quality test of the end product. “It’s only in this country, and these people face criminal prosecution if they slack on purpose or accidentally.”

the delivered material goes through a process that has been practiced for many years. Everything that arrives is first checked for its precious metal content, regardless of whether it is already pre-refined bars from a mine, a vat of old silverware, or leftover metal from a watchmaking industry for recycling. The material is registered, then either melted down or chemically processed through various processes in order to assess its value. The supplier is paid the same day.

Next, the metal mixture is further processed in the refinery, where the individual precious metals are gradually separated from one another and finally remelted in the purest possible form and processed further. “Depending on the starting material, this process can take between 15 and 50 days,” explains Montmollin.

Since Metalor pays the suppliers right at the beginning, but only receives money from the end customers at the end, the company has to have significant amounts available at all times, which is secured with the help of banks.

EXIT METAL DETECTORS

“The competition is fierce,” says Montmollin, “there are around 70 such refineries worldwide.” However, since Metalor also offers further processing of the metals, business is going well. The company does not publish specific figures.

Metalor employs 1,500 people at twelve locations worldwide, 280 of them in Switzerland. And all are carefully selected and must adhere to high-security standards. Metal detectors and security guards scrutinize those who work in the refinery at the exit to ensure that no metal escapes from the facility.

However, big business with gold is not without controversy. According to Swissaid’s Marc Ummel, mining often has to make way for forests, and water and nature are contaminated with highly toxic chemicals. Aid organizations complain about forced and child labor, exploitative working conditions, prostitution, and human trafficking, as well as the displacement of local populations. Ultimately, the source of the gold is decisive, says Ummel. According to the World Gold Council, 73 percent of all gold entering the world market in 2020 was mined gold and 27 percent was recycled. “For Switzerland, however, the ratio is exactly the opposite. And it is difficult, if not impossible, to trace the supply chains of recycled gold.”

GOLD FROM HEALING SOURCES

It is therefore difficult to ensure that Switzerland does not also process gold from problematic sources. According to Ummel, deliveries from Dubai are particularly delicate. The wealthy metropolis in the United Arab Emirates is “a risk hub for problematic gold, much of it from Africa”.

This currently also includes gold from Russia, which is subject to Western sanctions because of the Ukraine war. According to research by Swissaid, only one of the five refineries now obtains gold from Dubai: Valcambi in Ticino. However, she emphasized that she was adhering to the applicable guidelines and sanctions. However, this cannot be verified independently.

“Traceability is very important to us,” says Montmollin. “If we’re not sure where the gold is coming from, we don’t touch it. That’s why we don’t work with Dubai.”

WATCH FOR GOLD LABELS

Although around 70 percent of the gold processed by Metalor is recycled, almost all of it comes from Switzerland. a kind of circular economy has now been established.

some buyers are also willing to pay more for gold from a specific source or with a better standard, for example under the labels “Fair Mined”, “FairTrade” or “Swiss Better Gold”, of which Metalor is a founding member. They ensure that the gold comes from sources with good conditions for people and the environment.

The company is also subject to various national and international regulations. “And in cooperation with the University of Lausanne, we have developed a scientific method with which we can determine the source of mined gold very precisely.”

This so-called geo-forensic passport is intended to ensure that no material from problematic sources is mixed into a shipment – and is to be adopted by other players in the industry in the future, Montmollin hopes.

MORE CRAFTSMANSHIP GOLD

Metalor received praise for this from Marc Ummel: “It is an important tool, but it does not solve the problem of the lack of traceability of gold that has already been refined.” Ummel calls for more controls and specific sanctions for misconduct.

However, the company boss and the NGO_expert agree on many things: Both are in favor of strengthening cooperation with craftsmen, in which God is not promoted with huge machines, but largely by hand.

“There are around 25 million such miners worldwide,” explains Ummel. However, the problem is that it is very difficult to adequately control the conditions in these many mines. That’s why Metalor ended the cooperation with most of them a few years ago with a heavy heart. “A refiner alone does not have the means to ensure that all environmental and working conditions are met,” says Montmollin. “There would have to be a dialogue with governments, NGOs, local communities, and experts to develop a process and control procedures for a more sustainable gold value chain – and we don’t have that yet.”

Metalor is currently only sourcing gold from one such mine in Peru, where the relevant standards are ensured. “From our point of view, that would be the best way,” says Montmollin.

The bars have now cooled down. You will now be stamped; it is noted, among other things, the highest degree of purity of 999.9 and a federal certificate that stands for the highest quality worldwide. Then the gold bars go straight to the end customers, who are mostly banks, often in London. There they rest in dark safes, golden, valuable, and out of reach for almost everyone!

FACTS AND FIGURES

Mankind mined 205,233 tons of gold by the end of 2021. This corresponds to a cube with an edge length of 21.99 meters. This cube grows a few centimeters every year.

3000 TO 350

Tons of gold are mined every year.

54 000

Tons of other gold deposits are known worldwide that can be mined with current technical means. The largest is in Canada, South Africa, the USA, Australia, Russia, Chile, China, Indonesia, Mexico, and Paua New Guinea

Contributed by: Ralf Kaminski

translated by Ulrich Koepf