Data compiled by the precious metals consultancy Smaulgld.com showed India’s total silver import at 5,819 tonnes during the January-September period. On annualised basis, however, total silver import in 2015 is estimated at 7,759 tonnes - the highest ever India has imported in any calendar year so far, and a rise of 10 per cent from the previous year. During 2014 (calendar year), the total import of silver was recorded at 7,083 tonnes.
Rising imports of silver indicate rapid change in consumer preferences over the past three years since its price started falling. Unlike in the past, consumers see a resale value in any form of silver purchase including jewellery, artifacts and investments products such as 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 of India Bullion and Jewellers Association (IBJA), on the sidelines of World Silver Council inauguration here.
Under the aegis of IBJA, 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, IBJA has 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 workers. These initiatives were launched at the hands of Ram Nath Kovind, Governor of Bihar.
Much of the silver demand in India is going for jewellery and artifact consumption as consumers see a resale value in silver. Falling prices have encouraged consumers to prefer silver ornaments to imitation jewellery and metal artifacts.
After a staggering 19.31 per cent decline in 2014, silver prices fell nearly eight per cent in 2015. This means, the downward cycle in commodities has made silver affordable for consumers with a price decline of over 26 per cent in the past two years to $14.32 an oz now from the level of $19.47 on January 1, 2014.
Similar price decline was seen in local currency as well. Silver price in Zaveri Bazaar here is quoted at Rs 34,200 a kg now, a decline of 22 per cent 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 artifacts. The industry has witnessed a number of imitation jewellery consumers getting diverted towards silver ornaments due to falling prices. This does not mean 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.
As a consequence, there has been a rapid shift in silver consumption in the past 10 years. Global silver demand for industrial use has slumped to 54 per cent of global output in 2015 versus 69.4 per cent in 2005 and India is no exception. Similarly, demand from silverware / jewellery has risen to 25.4 per cent to 26.5 per cent and bars and coins from 5.2 per cent to 19.5 per cent.
“The industry needs promotion of silver jewellery and artifacts; 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.