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Gold Manufacturers Raise Fabrication Fees Amid Record High Prices


Gold Prices

Sat 18 Oct 2025 | 08:52 PM
Waleed Farouk

Informed sources said that gold manufacturing companies have decided to raise the fabrication fees (masna'iya) per gram of gold jewelry by 50 to 70 Egyptian pounds, starting next Monday, a move considered the largest of its kind in the history of the local market.

The sources explained that the decision came in response to the rise of global and local gold prices to record levels, in addition to the increase in fuel prices, which led to higher operating and production costs, especially in the item of "waste" or losses during manufacturing (khusayaat), resulting from the unprecedented rise in the price of the raw material. The price of 21-carat gold reached a new historical level of 5850 pounds in the local market, while the global ounce jumped to $4380. Consequently, prices have risen since the beginning of the year by about 2110 pounds locally (a 56% increase), and $1756 globally (a 67% increase).

Fabrication Fee... From Scrap Gold to Luxury Jewelry

The fabrication fee (masna'iya) represents the cost of converting raw gold or scrap into a final product, whether an ingot or a ready-to-trade piece of jewelry. This value includes the stages of melting, purification, shaping, and finishing in accordance with legal specifications. The fabrication fee varies according to the type of product, the company, and the geographical region. It was explained that the fabrication fee for ingots focuses on adjusting the carat and purification, while the fee for jewelry includes the cost of design, execution, and artistic touches that require high skill. The cost of manufacturing is affected by numerous factors, including energy prices (electricity and gas), the technology used in production lines, workers' salaries, transportation and insurance costs, in addition to the profit margins of factories and merchants.

Declining Returns and Rising Costs

The rise in gold prices has led to a decline in the investment return for jewelry factories. Previously, the fabrication fee represented about 10% of the gram's price, but it has dropped to only about 3% after prices doubled. Furthermore, the value of the fabrication fee in some neighboring countries is much higher than in the Egyptian market. The increase in production costs coupled with weak purchasing power has pushed manufacturers to reduce the weights of jewelry to suit consumers, with the weights of gold sets today ranging between 10 and 30 grams instead of 70 to 100 grams previously, which has increased the manufacturing cost per piece due to the difficulty of executing intricate details in small weights.

Variation in Fabrication Fees Between Carats and Regions

The fabrication fee is not fixed as a percentage but varies depending on the carat, craftsmanship, and technology used. The fabrication fee for 18-carat gold is higher than 21-carat due to its hardness and difficulty in shaping, in addition to the increase in the percentage of waste known as (khusaya). The fabrication fee in Cairo stores is typically lower than in the governorates due to lower transportation and insurance costs, while it differs from one piece to another; the fee for a "bangle" (ghuweisha) is less than a "ring" (khatem), and the fee for a complete set is higher than for individual pieces. Furthermore, the cost of inflated jewelry (hollow from the inside) is higher than solid jewelry due to its need for advanced production skills and techniques.

Italian Gold and Imported Jewelry

Imported jewelry, known as "Italian Gold," is considered the highest in terms of manufacturing cost, with the fabrication fee per gram ranging between 100 and 400 Egyptian pounds, resulting from the use of precise techniques and sophisticated designs with a high artistic flair.