India's Gold Import Declines to 7.9 Metric Tons in May 2014

Author: Paul Ploumis 03 Jun 2014

MUMBAI (Scrap Monster): As the gold prices plunged to 11 month low at Rs 27,000 per 10 gram last week, the gold imports are likely to surge in India. It is said that the sharp decline in yellow metal prices would draw back the gold premiums rates too.

The premium on gold has gone down from $110 per ounce to $35-$40 per ounce (31.99 ounce = 1kg) as the Reserve Bank of India permitted STAR trading houses to import gold.

As per the recent report, there were only 7.9 metric tons (MT) of gold was imported in May 2014 while comparing to 37.62 MT in May 2013. In 2013-14, only 92 MT of gold were imported whereas 193 MT in 2012-13.

In the meantime, silver imports continued to rise as 43.6 MT of the white metal was imported in May 2014.  In 2013-14, 1,425 MT of silver were imported, highest in last five years.

The bullion traders expect that the gold prices are likely to further decline to Rs 24,000- 25,000 per 10 g in the coming months. However, India had a 9% drop in jewelry demand to 145.6 tons in the first quarter of 2014.