For jewelers, all that glitters this year isn't necessarily gold.

Big jewelry chains are scrambling to cope with the rising price of bullion while striving to keep their baubles affordable for consumers still cautious in their spending.

Some are cutting back on the amount of gold in their products and turning to less expensive metals from silver to tungsten. Jewelers also are buying precious metals in bulk at fixed prices to hedge the risk of further spikes.

Even so, jewelry prices are likely to rise due to higher material costs. This year, gold prices have risen 22%, settling Wednesday at $1,336.80 a troy ounce, near a record high in nominal terms. Silver is up 52% and platinum is up 12%.

'If our costs go up, customers understand prices will go up as well,' said Mark Aaron, vice president of investor relations at Tiffany & Co.

The moves are aimed at helping the industry recover from anemic sales in the last few years. U.S. jewelry sales fell 2.7% in 2008 and another 1.6% in 2009, according to market-research firm Mintel International Group Ltd.

Gold's growing favor among investors worried about inflation and falling currencies has made the gold market far less reliant on jewelry demand. Jewelry accounted for 52% of gold demand through the first three quarters of this year, down from 73% in 2005, according to GFMS Ltd., which tracks the gold market.

In tonnage terms, the amount of gold used for jewelry plummeted by 35% between 2005 and 2009.

The fall-off has coincided with the decade-long gold rally, driven by investor interest. Since the end of 2000, when the gold price settled at $272 a troy ounce, it has nearly quintupled.

Jewelers have scrambled to adjust. Ben Bridge Jeweler Inc., a division of Warren Buffett's Berkshire Hathaway Corp., is selling more silver and platinum items, and has added wedding bands made of cobalt and tungsten at its 73 stores in 12 mostly Western states, according to Jon Bridge, a company executive.

'We've been looking at a lot of different alternatives,' said Mr. Bridge. 'Part of it is price driven, part of it is fashion driven.'

With precious metals prices up broadly, some big merchants also are attempting to contain costs by buying large amounts at a preset price, a strategy called hedging. Such contracts can help protect companies from unexpected increases in costs.

Liam Pleven / Ann Zimmerman