Good Delivery

Good Delivery refers to the standards set for the characteristics, production, and documentation of precious metal bars that are accepted for trading on international commodity markets. These standards ensure that the bars meet specific criteria regarding purity, weight, dimensions, and markings, providing a guarantee of quality and reliability. The term is most commonly associated with the London Bullion Market Association (LBMA), which regulates the Good Delivery Lists for gold and silver bars.

Historical Background

The concept of Good Delivery has its origins in the late 18th and early 19th centuries when precious metal trading began to formalize. The LBMA, established in 1987, has played a pivotal role in setting and maintaining these standards to ensure consistent quality and reliability. The Good Delivery List curated by the LBMA includes the refiners and bars that meet these stringent criteria.

Criteria for Good Delivery Bars

Purity

Purity is a crucial factor in determining the eligibility of a bar for Good Delivery status. For gold bars, the minimum acceptable fineness is 995.0 parts per thousand, while for silver bars, it is 999.0 parts per thousand. The higher the purity, the more value the bar holds, and it reflects the efficiency of the refining process.

Weight

Good Delivery bars have specified weight ranges. For example, gold bars typically weigh around 400 troy ounces (12.4-kilogram), whereas silver bars weigh around 1,000 troy ounces (31.1 kilograms). The precise weight can vary, but it must fall within the LBMA’s specified range.

Dimensions

Dimensions are another critical aspect of Good Delivery bars. The LBMA requires gold bars to have a length, width, thickness, and top surface dimension within certain limits to ensure uniformity and ease of stacking and transportation.

Markings

Each Good Delivery bar must be clearly marked with the following:

• The registered assay mark of the refiner.
• A unique serial number.
• The fineness (purity) of the metal.
• The year of manufacture.

Appearance

While the physical appearance does not affect the quality, the LBMA recommends that bars be free from excessive surface defects such as air holes, deep scratches, or other deformities to maintain a professional and standardized appearance.

Quality Assurance

The LBMA requires refiners on the Good Delivery List to undergo regular rigorous testing and assessment to ensure they continue to meet the established standards. This includes:

• Proficiency Testing: Refiners must participate in round-robin assays, where samples are sent to multiple labs for testing to confirm the consistency and accuracy of their assay results.
• Audits: Periodic audits of the refining process and facilities are conducted to verify compliance with Good Delivery standards.
• Random Inspections: Refiners may be subject to unannounced inspections of their bars to ensure ongoing adherence to quality and marking criteria.

Advantages of Good Delivery Status

Achieving Good Delivery status confers several advantages for refiners, traders, and investors:

• Market Acceptance: Bars from Good Delivery refiners are universally accepted in the wholesale market without the need for assaying, facilitating market transactions.
• Credibility and Trust: Inclusion in the Good Delivery List enhances a refiner’s reputation, signaling high standards of production and quality assurance.
• Liquidity: Good Delivery bars are highly liquid, as they can be traded quickly and easily on international markets.
• Standardization: The strict standards ensure uniformity, making it easier to handle and transport large quantities of precious metals.

LBMA Good Delivery List

The LBMA maintains two separate Good Delivery Lists for gold and silver. These lists include refiners who have achieved and maintain Good Delivery status. The lists are regularly updated to reflect changes in the status of refiners.

• Gold Good Delivery List: Maintains the names of gold refiners whose bars meet the standard criteria.
• Silver Good Delivery List: Includes refiners producing silver bars that adhere to the required specifications.

Refer to the LBMA Good Delivery List for detailed information on accredited refiners: LBMA Good Delivery List

Compliance and Amendments

The LBMA governs and updates the specifications periodically to adopt technological advancements and industry best practices. Compliance with these evolving standards is mandatory for refiners to retain their Good Delivery status. Failure to do so can result in removal from the Good Delivery List, impacting the refiner’s ability to trade on the international market.

Future Trends

The standards and practices governing Good Delivery are under continuous review, with several trends influencing future directions:

• Digitalization: Efforts are underway to implement blockchain and digital ledger technologies to enhance the traceability and transparency of precious metals through the supply chain.
• Sustainability: Increasing emphasis is being placed on sustainable and ethical sourcing practices, with potential future requirements for refiners to certify their metals’ origins.
• Technology Integration: Advancements in refining and assaying technologies are setting new benchmarks for efficiency and precision, potentially leading to stricter quality controls.

In conclusion, Good Delivery standards are a cornerstone of the global precious metals trading arena, ensuring consistency, reliability, and trust in the quality of gold and silver bars. The stringent criteria and regular quality control measures administered by the LBMA fortify market integrity, offering stakeholders the assurance of standardized and dependable trades. Understanding and complying with these standards is fundamental for any refiner aiming to achieve and maintain Good Delivery status.