Same thing (version 1.11 PC)

didnt find any solution duncan..im just ignoring dat merchant for now.

Me too. And quite near there is a treasure chest underwater which also don't turn grey (and there is anything to pickup). Strange region :)

Hi. After unlock the door, move out a bit then go again and open the door and move away again. He should move on himself and during walking out he will tell you that he is a craftsman and you will find him im Mulbrydale.

ok jewo ill try it..

Excuse, but how did you find this solution?

I have the same issue, tried everything (this included), and still can't make him react.

I got the same thing, I meditated in the cell beside him for 12 hours & when I "woke up" he had left.

This broke in 1.11.

There is no known way to make him react. The only solution to get it to work is to load a save from a previous patch.

If you meditate, you can make him leave but that makes him leave permanently... from the game. He just disappears. The Person In Distress marker will not be marked as solved.

Patch 1.12 seems to help -> Smith is no longer in prison, there are people in the place (like after removing monsters from abandon place).

I can also confirm that this works now.

After unlocking and opening the door, I still couldn't interact with him, so I headed back to Mulbrydale. By the time I arrived, he was already there at the anvil and available to interact with. The quest marker was also greyed out afterwards as well.

Cheers!

Running 1.22. The swordsmith leaves his cage and (eventually) gets back to Mulbrydale but I can't interact with him and a nearby post that's supposed to spawn upon his return doesn't either, just a piece of paper thanking me floating in mid-air. The bug exists on Steam as well, so it requires another patch to fix it.

The swordsmith is supposed to be an armour crafter (which is weird, considering his name), give you a reward for rescuing him, and be a Gwent player.

Altogether a very bugged bit of the game.

A Steam user noticed that if you meditate for 1 hour in the spot where an interactive NPC who's not talking to you works, they will start talking again (at least until you go away for a while then come back). I've tested this and it works with the Mulbrydale smith and the one in Kaer Trolde, who also has the same issue.