Gold Scrap and Recycling in Dubai: How the Process Works
How gold scrap recycling works in Dubai. Where to sell your old gold, how dealers calculate prices by karat, the refinery process at Kaloti and Emirates Gold, and environmental benefits.
What Counts as Gold Scrap?
Gold scrap encompasses any gold-containing item that the owner wishes to convert back into cash or refined gold. In Dubai's thriving gold market, scrap commonly includes: broken or damaged jewellery, outdated designs the owner no longer wears, inherited pieces of unknown sentimental value, dental gold, and worn-out gold items. Even tiny amounts of gold — a broken chain, a single earring — can be sold as scrap in Dubai's competitive market.
The recycling of gold is not just economically significant — it is environmentally critical. Mining one troy ounce of gold from the earth generates approximately 20 tonnes of waste rock and uses large quantities of water and chemicals. Recycling that same ounce requires a fraction of the energy and zero mining impact. The UAE has positioned itself as a regional leader in responsible gold sourcing, and recycling is a key pillar of that strategy.
Where to Sell Scrap Gold in Dubai
Gold Souk Dealers
The most accessible option for small quantities (up to a few hundred grams). Most Gold Souk dealers buy scrap gold from the public. The process is informal: you bring your pieces, the dealer weighs them on a certified scale, performs a quick purity test (acid test or XRF scan), and quotes a price. Shopping around two or three dealers is advisable as prices can vary by 1-3%.
Pawnshops
Licensed pawnshops (rahn shops) in Dubai buy gold at prices slightly below Gold Souk dealers to account for their service model. They offer the advantage of convenience and sometimes faster payment. Pawnshops are regulated by the Dubai Economy and Tourism department.
Gold Refineries
For larger quantities (500 grams+), dealing directly with a refinery is more profitable. Dubai hosts several world-class refineries including Kaloti Jewellery International and Emirates Gold, both of which operate LBMA-aligned responsible sourcing programmes. Refineries typically pay closer to the actual spot price (95-98% of spot value after refining loss deduction) for large quantities.
How Dealers Price Scrap Gold
The scrap gold pricing process in Dubai follows a systematic methodology:
- Weighing: Your gold items are weighed on a certified scale. Total weight is recorded in grams.
- Assay test: Purity is determined via one of two methods: (a) Acid test — a scraping from the item is tested with nitric acid solutions of known concentration; reaction speed indicates karat. Quick and cheap but slightly less precise. (b) XRF (X-ray fluorescence) scan — a handheld device scans the item and returns precise elemental composition within seconds. Increasingly common at reputable dealers.
- Price calculation: Payment = (purity as decimal × weight in grams) × (spot price per gram × dealer buyback ratio). The buyback ratio for most Gold Souk dealers ranges from 92-96% of spot, meaning you receive 92-96 fils for every AED 1 of gold content. Refineries pay closer to 96-98%.
Typical Scrap Payouts by Karat
| Karat | Purity | Est. Payout (% of 24K spot) | Example: 10g at AED 350/g spot |
|---|---|---|---|
| 24K (999) | 99.9% | 95-97% | AED 3,325-3,395 |
| 22K (916) | 91.6% | 87-89% | AED 3,045-3,115 |
| 21K (875) | 87.5% | 83-85% | AED 2,905-2,975 |
| 18K (750) | 75.0% | 71-73% | AED 2,485-2,555 |
| 14K (585) | 58.5% | 55-57% | AED 1,925-1,995 |
The Melting and Recycling Process at UAE Refineries
Once a refinery acquires scrap gold, the recycling process follows several stages. First, scrap is sorted and sampled — a representative sample is fire-assayed to determine average purity of the batch. Then the material is melted in induction furnaces at temperatures exceeding 1,064°C (gold's melting point). The molten gold is cast into anodes and passed through an electrolytic refining process (the Wohlwill process) that achieves 99.99% purity. The refined gold is then cast into bars, granules, or shot for re-entry into the manufacturing cycle.
UAE refineries such as Kaloti and Emirates Gold are certified under the Responsible Jewellery Council (RJC) and the Dubai Good Delivery (DGD) standard, ensuring that recycled gold meets the same quality and traceability requirements as newly mined gold.
Gold Recycling Certificates
For B2B transactions (jewellers selling manufacturing scrap to refineries, for instance), refineries issue gold recycling certificates that document the weight, purity, and value of the scrap received. These certificates are important for VAT accounting, KYC/AML compliance, and supply chain transparency certifications. Individual retail sellers of scrap gold typically receive a simple purchase receipt rather than a formal recycling certificate.
Environmental Benefits of Recycling Gold in Dubai
The UAE recycled approximately 150-200 tonnes of gold annually in recent estimates, positioning it as one of the world's top gold recycling centres. This recycled gold offsets equivalent primary mining demand, saving significant CO₂ emissions and environmental damage. The DMCC's UAE Precious Metals Programme actively promotes responsible sourcing, including recycled gold certification for manufacturers who wish to market their jewellery as sustainably sourced.
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