The board's price-setting

The Ghana Gold Board is the sole buyer of artisanal and small-scale gold in Ghana. It publishes an approved purchase price per pound, set off the LBMA price and a cedi reference rate. Two prices are published each trading day.

The board is the sole buyer

The Ghana Gold Board is the only legal buyer of artisanal and small-scale gold in Ghana. Licensed buyers must pay the approved purchase price, and they may not pay less. That makes the board's price the single most important number for a small-scale gold seller. The board sets the price off the LBMA benchmark and a cedi reference rate.

Because the board is the sole buyer, a seller cannot shop around for a better price from another licensed buyer. The approved price is the floor. A buyer may pay more, perhaps for higher fineness or for a larger lot, but the board's figure is the reference. That concentration of buying power is the reason the price-setting process matters.

Two prices each trading day

The board publishes two prices on trading days, one off the LBMA AM benchmark and one off the LBMA PM benchmark. The LBMA price is set in US dollars in London, twice a day. The board takes those dollar prices, applies its cedi reference rate, and any discount, and publishes the result as the approved purchase price per pound.

The two prices can differ because the LBMA price moves during the day, and the reference rate can also change. A seller who sells in the morning may be paid at the AM price; a seller who sells in the afternoon may be paid at the PM price. The board's page shows the current approved price, and a licensed buyer should quote the price for the window in effect at the time of sale.

The LBMA benchmarks

The LBMA price is a benchmark gold price set in US dollars, twice a day, in London. It is the price the board uses as the basis for its approved purchase price. The AM benchmark is set in the morning, and the PM benchmark in the afternoon. The board publishes its approved price after each benchmark.

The LBMA price is not the only world gold price, but it is the one the board has chosen. A reader who follows another price may see a small difference. The board's page shows the LBMA price it uses, and this site reads that figure. The two benchmarks give the board two chances each day to update its price.

The cedi reference rate

The board does not use the Bank of Ghana's interbank rate to convert the LBMA dollar price into cedis. It uses a reference rate of its own. That rate is set by the board, and it can differ from the interbank rate. On the day measured, it sat more than one per cent below the interbank rate. A lower reference rate means fewer cedis for the same dollar price.

A seller who is paid at the approved price is being paid at the board's reference rate, not at the interbank rate. That is not a hidden fee; it is the rate the board uses to translate its dollar benchmark into cedis. The gap between the two rates is a cost to the seller, and it changes from day to day.

Why a buyer's slip may differ

A licensed buyer's slip may show a different figure from the headline approved price. That is not necessarily a violation. The buyer will assay the gold to determine its fineness, and the approved price is for gold of a stated fineness. If the gold is of lower fineness, the price per gram will be lower. The buyer will also weigh the gold in grams, and the weight may differ from the implied pound weight.

The buyer should provide a written breakdown that shows the weight in grams, the fineness after assay, the price per gram, and any adjustments. The approved price is the starting point, but the actual payment depends on the assay and the weight. A seller who is offered less than the approved price should ask for that breakdown in writing.

What happens between the two windows

Between the AM and PM benchmarks, the LBMA price can move, and the reference rate can change. The board does not publish a price in between. A seller who is negotiating a sale in the middle of the day should know which window's price will apply. The board's page shows the current approved price, which is the latest published figure.

A licensed buyer may quote the latest price, but the seller should confirm the window. If the sale is completed after the PM benchmark, the PM price applies. If the sale is completed before the PM benchmark, the AM price may still be in effect. The timing matters because the price can move between the windows.