Gold Imports by India Collapsed 20% in 2018

The Dec ’18 imports totaled around 60 tons, substantially lower by 23% when compared with the imports during the same month in 2017.

SEATTLE (Scrap Monster): The demand for yellow metal witnessed notable decline in India during the previous year. The gold imports by the country registered a decline of nearly 20% in 2018. The imports totaled 762 metric tons, the second smallest amount shipped to the country over the past decade. The country had recorded its lowest gold imports of just over 500 tons in 2016.

Also, the imports witnessed sharp fall towards the end of the year. The Dec ’18 imports totaled around 60 tons, substantially lower by 23% when compared with the imports during the same month in 2017.

The gold demand trend continued to remain weak in India during the entire year 2018. The demand has been on decline, mainly on account of the declining rupee, which makes dollar-designated gold expensive in domestic market. The festive and wedding season failed to lift the demand for gold in the country. The demand for gold from rural areas has dropped by more than 50% since mid-December last year. The prevailing high gold import duty structure continued to contribute to the decline in gold bar imports.

The poor demand has resulted in local gold trading at a discount of $10-$12 per ounce on international gold prices this week. Gold discounts have widened when compared with $8 per ounce last week.

Meantime, market participants are of the view that the demand trend may turn in favor of gold in the first half of 2019. The anticipated pickup in investment purchases is likely to lift gold demand by at least 20%, they said.

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