LONDON (Reuters) - Sky-high precious metals prices are forcing many cash-strapped couples to switch from platinum bridal rings to cheaper white metals such as white gold and palladium, jewellers in London’s diamond jewellery district say.
Platinum surged 50 percent this year to hit a record high of $2,290 an ounce in March, driven by strong industrial demand and power shortages in top producer South Africa.
Prices of platinum, used in autocatalysts as well as jewellery, are now quoted at around $2,150, but they are still up 40 percent this year.
The surge in precious metals prices, and a squeeze on incomes caused by the credit crunch and soaring food and fuel prices, are triggering changes in consumer behaviour in the bridal market, according to jewellers in London’s Hatton Garden.
“People are looking for alternatives -- and a good alternative to platinum at the moment is palladium,” said Ercan Onguc, manager at Beverley Hills London.
Prices differences between the metals are stark.
For instance, a 5 mm ladies’ platinum wedding band retails for 923 pounds, almost four times the cost of a 5 mm palladium ring at 250 pounds and a 5 mm white gold band at 263 pounds.
“There is less platinum being sold,” said Kevin Reilly, manager of Classic Jewels. “People, particularly for wedding rings, have been switching to 18-carat white gold or palladium,” he added.
Women, enchanted by platinum’s romantic cachet, tend to still insist on platinum, especially those on the highest incomes, whereas men are more likely to compromise on cost and go for the less glamorous and cheaper palladium, jewellers say.
And though both are hard metals, platinum has the edge over palladium because it is denser. Platinum is also marketed much more vigorously than palladium.
A salesman at County Jewellers said some couples on tight budgets were opting for cheaper alternative metals over platinum in order to afford a larger diamond.
Well informed about the recent spike in precious metals prices, notably platinum and gold, more customers are now making enquiries about palladium and white gold bridal rings, jewellers say.
Heightened volatility in precious metals is forcing jewellers to re-price their stock much more often nowadays.
A sign placed prominently in one Hatton Garden jeweller’s window said: “Due to the fluctuation of metal prices, all wedding rings shown could be subject to surcharges.”
Jewellery manufacturers are loathe to use less platinum in wedding rings or to hollow out designs to compensate for the rise in precious metals prices.
“Manufacturers don’t want to reduce the quality of the goods that they’re selling -- you have to stick to a good quality product,” said Tim Bicknell, manager at Hamiltons.
Editing by Ben Tan
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