Silver import in India is likely to set a new record in this calendar year due to rapid change in consumer preferences from imitation jewellery and artefacts made of alternative materials to silver.
Data compiled by precious metals consultancy Smaulgld.com showed India’s total silver import at 5,819 tonnes between January and September.
On an annualised basis, however, total silver import in calendar year 2015 is estimated at 7,759 tonnes, the highest ever India has imported in any calendar year so far, registering a rise of around 10% from the previous year. During the calendar year 2014, total import of silver was recorded at 7,083 tonnes.
Rising import of silver in India indicates a rapid change in consumers’ preferences over the last three years ever since its price started to fall. Unlike in the past, consumers now see a resale value in any form of silver purchase including jewellery, artefacts and investments products like coins and bars.
“As the trend shows from the volume of import between January and September, silver import in India will set a new record this year,” said Mohit Kamboj, President, India Bullion and Jewellers Association (IBJA), on the sidelines of World Silver Council inauguration here.
After a staggering 19.31% decline in 2014, silver prices fell by nearly 8% in 2015. This means, the downward cycle in commodities has made silver affordable for consumers with a price decline of over 26% in the last two years to $14.32 an oz today from the level of $19.47 on January 1, 2014.
Similar price decline was seen in local currency as well. Price of silver at Zaveri Bazaar is quoted at Rs 34,200 a kg now, a decline of 22% from the level of Rs 43,800 a kg on January 1, 2014.
“A large chunk of imported silver goes for retail consumption for jewellery and artefacts. The industry has witnessed a number of imitation jewellery consumers getting diverted towards silver ornaments due to falling prices. This does not mean that the demand of imitation jewellery has completely evaporated. But, their average annual growth has declined in favour of silver jewellery,” said Rahul Mehta, managing director, Silver Emporium, a silver jewellery and artifacts’ manufacturer and retailer in Zaveri Bazaar here.
As a consequence, there has been a rapid shift in silver consumption in the last 10 years. Global silver demand for industrial use has slumped to 54% of global output in 2015 versus 69.4% in 2005 and India is no exception. Similarly, demand from silverware/jewellery has risen to 25.4% to 26.5% and bars and coins from 5.2% to 19.5%.
“The industry needs promotion of silver jewellery and artefacts; similar to the World Gold Council does for gold. Once World Silver Council starts promoting silver ornaments and other articles, India’s silver demand and import would zoom further,” said Mehta.
Meanwhile, under the aegis of IBJA, the World Silver Council was launched to protect the interest of silver miners, importers, refiners, traders, jewellers and all other directly and indirectly linked with the white precious metal.
Along with the World Silver Council, the IBJA also launched two other initiatives — First Step Foundation for fulfilling its corporate social responsibility and Skill Development Council to help enhance the skills of the Karigars in the industry. These initiatives were launched at the hands of Ram Nath Kovind, Governor of Bihar.
A SILVER LINING Silver import in India Calendar year Quantity (in tonnes) 2008 5,429 2009 1,264 2010 2,588 2011 4,633 2012 2,120 2013 6,132 2014 7,083 2015* 7,759
Source : Smaulgld.com, * 2015 data is annualised based on Jan-Sept import figure of 5,819 tonnes