JEDDAH: Gold shops are expecting a bumper summer season this year, with sales coming from weddings, celebration of examination results, tourism festivals and Eid Al-Fitr. Shops are expected to have displays of modern and classical pieces to satisfy all tastes. Prices have risen to SR175 per gram for 21 carat gold while 18 carat costs about SR5 less per gram. Gold market dealers say there is a “hidden war” between shops to display the best gold ornaments to attract customers. They pointed out that the main focus is no longer traditional jewelry like bangles, but simple, beautifully shaped pieces. Abdullah Humaid, manager of a gold and jewelry shop, expects the overlapping occasions to raise Saudi gold consumption in 2011 to SR19 billion compared to SR14 billion in 2007. He estimates the volume of demand for gold in the Kingdom at 200 tons annually while there are six million shops, mainly in the Eastern Province, Riyadh and Jeddah. Humaid attributed the Kingdom's high gold sales to the purchasing power and presence of over six million pilgrims during the Haj and Umrah seasons. He said the Kingdom's gold market ranks fourth in the world after the United States, India and China. Meanwhile, a few buyers criticized some gold shopkeepers for raising prices unnecessarily, especially for small pieces, raising their commission per gram to SR33 when the profit range of SR10 to SR11 is considered reasonable. Umm Muhammad, a customer, was astonished when a gold shop owner in Souq Al-Murjan set a price of SR195 per gram for a pair of simple earrings of not more than five grams in weight. The shop owner claimed that the extra cost was for the cost of workmanship despite the earrings not being of a distinctive design. She called on shopkeepers not to overcharge buyers. Umm Muhammad stressed that this was simply pure greed.
