India emerged as the world's largest gold consumer in 2014: GFMS

NEW DELHI (Scrap Monster): The latest industry report released by GFMS analysts at Thomson Reuters positions India as the leading gold consumer in the world during 2014. The report states that India squeezed China to second spot in the race to become the world’s largest gold consumer during the year. The report states that global gold demand fell sharply during the year. It further forecasts that gold prices are most likely to bottom out in 2015, after two straight years of decline.

The Chinese gold demand had topped 1,000 tonnes for the first time in 2013. The country’s gold consumption had jumped 41% year-on-year to 1,176.40 tonnes. However, the Chinese gold demand fell sharply by nearly one-third from the remarkably extraordinary levels of 2013 to a four-year low of 866 tonnes in 2014. The Chinese jewellery demand rose 33% to 608 tonnes. Also, the physical bar demand in the country plunged by 53% to a five-year low of 171 tonnes.

The Chinese gold demand is expected to improve in 2015. However, only dramatic course of events could take it closer to the record levels of 2013.

Meantime, Indian jewellery demand grew 14% to 690 tonnes. The country overtook China to become the world’s largest jewellery manufacturer.

The GFMS analysts report also states that the global physical gold demand tanked 19% in 2014. Also, the world jewellery demand fell 11%. The global gold mine production jumped nearly 2% to a record 3,109 tonnes during the year. However, scrap supply of gold saw a cut of 11%.

The precious metal may fail to attract fresh retail investment, despite averaging around $ 1,180 per Oz during the first half of the year. According to GFMS, the gold prices are likely to average at $ 1,170 per Oz during the entire year 2015. This should mark the low point for gold and signal a bear-market reversal.