Tag Archives: Prospecting

Titanium Dropping in Price

The WoWenomics team was discussing Titanium Ore recently and all team members agreed that the prices are down from their peak just a few weeks ago. Whereas typical prices for a stack of ore were reported as being in the area of 350 gold or more, we searched ten auction houses across five servers last night and found stacks available for buyouts at sub-300 levels on seven of the ten auction houses. We cannot say definitively how much prices are dropping since we have not been statistically recording the prices across servers but, anecdotally at least, it would appear that the ore, and goods and services related to the ore, are currently on the decline.

The reasons for the drop in price of Titanium are probably a combination of:

  • Increased supply– Titanium Ore has been so profitable for so many weeks that many more players are jumping into the farming for resale market, causing a certain amount of over-supply.
  • Decreased demand– As epic gem prices drop and stabilize perhaps Jewelcrafters are finding high ore prices intolerable.

In fact, one interesting correlation that we noted in our research was that of the seven servers that showed lower ore prices, every single one showed decreased epic gem prices. Prices for uncut gems on these servers were typically within the area of 140-150 gold. It may be that epic gem prices can be used as an early indicator of the direction of Titanium Ore. If you are in the ore market, either buying or selling, you might want to also look into the prices of epic gems to determine your optimal pricing and/or farming strategy before you set out on your daily quest for profits.

It is impossible to say if the observed decline in Titanium prices is here to stay of if this is just part of the cyclic nature of the WoW economy but, for the time being at least, we are rating Titanium Ore as a sell.

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Raw Epic Gems on the Rise

Uncut epic gems are showing increases in price on every server we tested. This is occurring even as the prices of many cut epic gems are decreasing in price. The reasons for this pricing anomaly are simple.

Demand is Up

Uncut (or raw) epic gems gain value as demand increases. We are currently seeing a demand increase because many jewelcrafters now each have several learned patterns and are increasingly gaining more. As jewelcrafters learn more patters, and seek to cut more gems, the demand for raw gems increases. Demand for cut gems is also on the rise due to the new Arena Season, new PVP gear and additional PVP content but the cut demand is not increasing as fast as the uncut demand… for now. It is reasonable to expect that cut gem demand will equalize with, or possibly even overcome, uncut gem demand as more players gain new gear and as players develop a coherent strategy as to how they wish to gem their gear with epic cuts. Of course, any increase in cut gem demand will also increase demand for uncut equivalents but the opposite relationship is not necessarily true.

Supply is Down

Again, with the release of new PVP gear, many players are back to spending their honor points on attaining this gear as opposed to purchasing gems for resale. Further, most players are reporting their experiences with prospecting Titanium Ore to be unprofitable and are thus not pursuing this avenue of gem creation either. This leaves a significant dent in the supply of raw epic gems and a market ripe for exploitation by the savvy WoW trader.

Conclusions

If you have excess uncut epic gems keep an eye out for opportunities to sell them at a premium. The servers we tested each showed at least 3 out of 6 possible colors of epic gems to have at least some cut gems that were selling lower than the price of uncut gems. One server showed at least one cut gem in each gem color category to be selling cheaper than their raw counterparts.

The signs of a good selling opportunity include (but are by no means limited to):

  • A very low (perhaps < 5) amount of uncut epics available
  • Multiple cut gems selling for less than their uncut counterparts
  • A sharp rise in prices of a popular cut gem(s)

The market is moving, make sure you are moving accordingly. In put it in PVE terms, don’t stand in the purple AH fire.

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The Profit Potential of Powder

We’ve previously explained our reluctance to write about already hyped up WoWenomic trends but our resident Jewelcrafter has recently weighed in to point out that he is just killin’ it these days with Titanium Powder.

Titanium Powder is the residue remnants of prospecting Titanium Ore. Ten of these powders can be turned in to Tiffany Cartier, the Dalaran Jewelcrafting supplier, for a single Dalaran Jewelcrafter’s Token. These tokens are then used to purchase various items and recipes of value to Jewelcrafters. Most recently, four tokens can be turned in for an epic gem recipe introduced in patch 3.2. The fact that these recipes are still so new to the game and the source material, Titanium Ore, is so high in price, creates an elevated demand for Titanium Powder.

Pricing, Prospecting and Powder

Our associate informs that he is generating huge profits by purchasing any Titanium Ore that falls below his bid level and immediately prospecting it and selling the proceeds. He claims to receive approximately one stack of 10 powder per 30 ore prospected. A rate that is roughly in line with the listed results on WoWhead.com. All told, he claims profits in excess of 150 gold per stack of titanium that he purchases. Provided he can gather or purchase enough ore below his bid level, this allows for an unbelievable amount of income in a very short time so we asked for his specifics. And he provided…

Bid level on stack of 20 Titanium Ore: equal to or under 300 gold
Sell price for single Titanium Powder: approximately 50 gold
Sell price for stack of 10 Titanium Powder: approximately 475 gold

The Big Money

So if he gets a stack of 10 powder (which he sells for 475-500) from approximately 30 Titanium Ore (at a maximum cost of 450 gold) we are left questioning where these ridiculous profits are coming from as this is only 25 to 50 gold. Still nice for zero effort but where’s the big money? That’s when he dropped the bomb… Titanium Powder is only a small part of the prospecting results. In addition to the powder, he regularly gets at least one epic gem per 20 ore prospected as well as 3-4 rare gems and 4-5 uncommon gems. As he’s a Jewelcrafter by trade (and not just an ore destroyer) he also cuts any gems that he has cuts for prior to listing in the AH. He sets his ask level for these items as follows (based on market conditions):

Uncommon gems: 1-5 gold
Rare gems: 5-12 gold (up to 50 for Scarlet Rubies)
Epic gems: 130-160 gold
Cut Epics: 190-380 gold

Let’s take the most modest of all those numbers (price and prospecting results): Assuming only 3 rare gems (and no rubies), 4 uncommon gems and a single epic per stack (not even counting cut epic gems) of titanium ore, all priced at the bottom of the chart above, we’re talking about an additional 148 gold. But wait, that math only accounts for a single stack of Titanium Ore but our previous numbers to reach 10 powder were based on prospecting 30 ore. This brings the total gem proceeds up to 222 gold. That’s 222 gold on top of the already 25-50 he’s bringing in from the powder (since we paid for the ore with our powder in this equation). Hot damn… those are some nice numbers.

Overall Strategy Tips

There are a few tips to making this strategy work for you.

  • We advise only selling the powder in stacks of ten or singles. The ten stacks are the perfect amount for someone just trying to get an additional token quickly and the singles are the perfect increment for players that just need a few more powders for their next token.
  • Don’t flood the AH with the dust or gems. Doing so will only cause the prices to drop faster.
  • Speaking of which, this is a “limited time only” strategy. Eventually the prices of powder and epic gems will deflate or the market will otherwise normalize. Act now if you intend to cash in.
  • Just like a drug (or junk bond) dealer, never get high from your own supply. Be patient and get your own tokens from the daily quest system. Don’t use your own powder for tokens since it sells for so much right now. Later, as prices of powder go down, you can use it in this fashion.
  • Have patience; sometimes the powder or gems won’t sell during a posting cycle. Other times it will all sell out, at any price. People get desperate or greedy but it can be cyclic. Play the long game.
  • Don’t try this on a single stack and expect exactly the same results. Our Jewelcrafting expert actually came up with these numbers based on spreadsheets that he uses to record his results and profits. Yes, he’s *that guy*. Anyway, he prospects hundreds of ore daily and the numbers he shared are based on his averages. In short, YMMV.
  • This strategy assumes an understanding of, and strict adherence to, a solid bid/ask strategy the development of which requires some amount of common sense. We make no assumptions about the common sense level of the average WoW player. Consider this a disclaimer.
  • The prices on your server may differ from those described above but the ratios and relative values are probably similar. Thus, use the above as a guideline but not exact price points. Do some homework and develop your own bid ask levels that work for your unique profit goals.

The Only Downside

Our Jewelcrafter asked me not to post the exact details under threat of incineration. His fear, and reasonably so, is that if this strategy becomes too popular then prices will drop faster and it won’t work any longer. I was actually hesitant to post this because he was pretty clear about his mortal threat to me but then I remembered that he plays a mage so I just LOL’d and posted it anyway. Of course, this assumes he was talking about in-game death. Perhaps I should have clarified…

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Why Cobalt is More Expensive Than Saronite

For several weeks now we’ve been tracking the prices of Cobalt bars and ore and Saronite bars and ore and dropping these numbers into our spreadsheets. Aside from a slight deflationary movement that we’ve seen with similar items previously, there is really nothing remarkable about these minerals from an economic perspective. Well, maybe one thing: Despite the lower-level availability of Cobalt, Saronite remains the more inexpensive of the two on all three test servers. So that got us wondering, if Cobalt is more readily available, why does it cost more than Saronite?

Our first inclination is that Saronite might be the lesser ore as it is rumored to have been cursed by one of the Old Gods who is believed to have the power to drive men mad. However, being analysts and not mythologists we decided to delve further. We started our research at the end of the supply chain and compared demand for the two metals. Is Cobalt in more demand than Saronite? Put another way, are there more in-game uses for Cobalt than Saronite? WoWhead shows us this is not the case:

Number of recipes calling for Saronite Bars: 96
Number of recipes calling for Cobalt Bars: 50

A further examination of the prospecting properties of each ore reveled that Saronite also yields a higher percentage of rare gems when prospected by a Jewelcrafter. This is similar to the relationship between Fel Iron Ore and Adamantite Ore from the Burning Crusade expansion.

So it is clearly not demand that is driving the price in this case. If demand were the driver, Saronite would be the clear winner in the price wars.

Next we decided to take a look at the other side of the gold coin and explore supply. And here, on the supply side, we found our answer. According to the WoW Top List from Blizzard (also easily found on our Resources page), Saronite is not just farmed much more than Cobalt, it is currently the number one ‘Most Gathered Item’ in the game. Cobalt, on the other hand, comes in regularly somewhere around 11th (hint for those of you following along at home: change ‘# of days’ to 7). In this case, supply is so great that it skews the supply/demand curve and drops the price of Saronite. Or does it elevate the price of Cobalt? Either way, the financial moral of the story here is that just because demand for an item is huge it doesn’t necessarily mean that the price will be higher.

A few tips on making gold from the purchase or sale of these ores:

Whereas Saronite Bars require two ores of the equivalent metal, Cobalt only requires one. If you’re hunting for Cobalt Bars, don’t pay the inflated price for the bars. Simply buy the ore and have a friendly miner smelt them for you.

Both of these ores are frequently available on the auction house but, as mentioned above, Saronite is the more popular of the two. So, assuming both are priced reasonably, while you may be able to sell the Cobalt for more, Saronite will usually sell faster. Thus, our conclusion is that it is best to sell Saronite in bulk (3-4 or more stacks at a time) and Cobalt should be bled into the market more slowly.

As mentioned previously, it is almost always best to sell ore as opposed to bars as it widens your potential market. There are exceptions to this rule but it stands true for most WoW metals.

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