India Silver Market: Policy Tightening Curbs Imports, Festive Demand May Bring Marginal Improvement
Since May this year, India has imposed a series of restrictions on silver imports: on May 13, the basic customs duty on gold and silver imports was raised from 5% to 10%; on May 16, it further required import authorization and expanded the scope of regulated silver products; starting in June, the import status of some silver products was changed from “free” to “restricted,” with silver granules and powder also added to the restricted list. The tightening policy environment significantly raised the barriers to silver imports into India, profoundly affecting global silver trade flows.
India is a major global silver consumer market, with demand exceeding 7,000 mt in 2025, driven mainly by jewelry, silverware, and electronic components. The first day of Diwali, “Dhanteras,” is a traditional peak for silver purchases; in 2025 alone, national silver consumption during the festival reached 800–1,000 mt.
In 2025, India's silver import demand reached 7,167 mt, with 30% from the UK and 40% from Hong Kong. However, after India introduced tighter silver import policies in May this year, imports in H1 2026 totaled just 1,843 mt, down 23% YoY. Affected by the US-Iran war and high silver premiums in China, exports from Hong Kong and the UAE to India shrank sharply; Hong Kong exported only 124 mt to India in H1.
Recently, foreign media reported that India imported about 89.81 mt of silver via the IIBX platform in August, ending a six-month streak of zero imports. However, around 400 mt of import permits have now been approved, improving supply from July. Still, the new regulations pose hurdles—each shipment must be accompanied by a “Certificate of Origin (COO)” from the country of origin, and many traders have been unable to clear customs due to documentation issues, with some shifting purchases to exporting countries that can provide compliant paperwork more quickly. Indian domestic silver premiums to global prices narrowed slightly on improved supply, but the 30-day average remains around $4/oz, and logistics and customs clearance still take several weeks. The market currently relies more on inventory and sporadic supplies, and is not yet seeing a full-scale supply recovery. However, with the festive and wedding seasons approaching, jewelers’ restocking demand may provide a certain boost to imports.
From the perspective of Hong Kong premiums, last week, affected by news of easing Indian imports, the Hong Kong spot premium (to LBMA) briefly closed at a discount of $0.2-0.1/oz, but actual demand did not improve. This week, the trading center shifted down to a discount of $0.25-0.2/oz. H2 India's festival demand is approaching, which is expected to improve the current inventory buildup situation.
China Silver Ingot Export Market: July Exports Down 25.6% MoM, Hong Kong Inventory Accumulation Awaits Global Trade Recovery
In July 2026, China's exports of 99.99% unwrought silver ingots totaled 350.6 mt, down 25.6% MoM and down 13.84% YoY. In January-July, cumulative exports reached 2,626 mt, down 2.9% YoY. July imports were 38.01 mt. In terms of silver ore and concentrates, imports in July were 213,800 mt, up 40% YoY, and cumulative imports in January-July reached 1.3783 million mt, up 36% YoY.
H1 cumulative exports totaled 2,275 mt, edging down 0.97% YoY, of which processing trade with imported materials accounted for about 95%. On the import side, H1 cumulative imports reached 847 mt, surging 2,241% YoY. From January to April, large volumes of imported silver ingots flowed into the market, causing noticeable inventory buildup in Shenzhen and other places. Low-price shipments from import suppliers continuously disrupted normal trade quotations, and combined with weak industrial demand, domestic social inventory of silver ingots continued to accumulate.
Since May, China's silver ingot trade flows have gradually returned to normal export patterns, and the domestic silver price premium has narrowed, leading to a subsequent decline in imports. Exports have been dominated by smelters, with over 90% shipped to Hong Kong. However, affected by India's tightening import policies, Hong Kong's exports to India have dropped significantly, causing Hong Kong's silver ingot inventory to gradually build up since May.
Looking ahead to September, boosted by India's festival demand, the discount on exports to Hong Kong is expected to narrow. China's processing trade exports have continued to grow this year, and the import window remains open. If it opens periodically, it could bring some import growth, further exacerbating inventory buildup pressure.
