Tuesday, April 8, 2014

India Silver Import

by Koos Jansen

January India Silver Import 462 MT

The DGCIS, India’s customs department, just released the trade numbers for January 2014. Strangely For gold and silver they only disclose the import numbers. To figure out net import I’m aware of only one other source; COMTRADE, but they haven’t caught up until January. For gold we know the Indian government implemented the 80/20 rule in August 2013, meaning gold traders have to export 20 % of their imported gold. By knowing how much gold was officially imported we can thus calculate how much was officially exported.

India officially net imported 28 metric tonnes in January 2014, up 12 % m/m, down 77 % y/y.

Gold trade 1-2014

However, the official numbers on gold import have very little correlation to Indian demand as the majority of gold is smuggled into the country. The main reason for this is India’s import duty on gold that was raised in January 2013 from 4% to 6 %, in June to 8 % and in August to 10 %. Resulting in high premiums and increased smuggling. This chart is from Nick Laird, sharelynx.com:

Indian Premiums AU

In this video by Sunny Pannu from Minaurum gold, Indian gold expert Jayant Bhandari explains the current situation in the Indian gold market.

Another result from the restrictions in gold trade is that many Indians flocked to silver. 2013 Indian net silver import broke all records at 6016 metric tonnes. The Indian gross monthly import average in 2013 was 512 metric tonnes. In January 2014 gross silver import was 461 metric tonnes, down 44 % m/m, up 51 % y/y.

Silver trade 1-2014

In Precious Metals We trust

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