Mumbai: India’s gold imports in February slumped 81% from a year earlier, the fifth straight month of decline, after record prices deterred purchases by jewellers and retail investors in the world’s biggest buyer of the metal.
Imports last month totaled 10.2 tonnes from 54 tonnes a year ago, according to the Bombay Bullion Association Ltd, which represents 230 trading companies. Overseas purchases plunged to 15.2 tonnes in January and February combined, from 110 tonnes a year earlier, it said.
Gold prices are 16% higher this year after crude oil topped $100 (Rs4,030)a barrel and the dollar dropped against other major currencies.
Bullion for immediate delivery, which reached a record $989.54 an ounce on 3 March, traded at $965.95 at 1.56pm Mumbai time.
“There’s no demand at all for imported gold,” Suresh Hundia, president of the association, said in a phone interview in Mumbai. “If prices stay at current levels, India may not import half of what it bought last year.”
Buyers from India reduced purchases by 64% to 83.9 tonnes in the three months to 31 December, the producer-funded World Gold Council said last month.
Global demand dropped to 843 tonnes from 1,013.4 tonnes in the same period, according to the London-based council.
“Demand will remain subdued even in the peak marriage season as the current levels are not attractive to Indian buyers,” Hundia said.
“Sales of scrap gold are good enough to meet the sporadic demand,” he added.
High prices have also reduced demand for silver and the nation has not imported silver since October, Hundia said.
“There’s still substantial stockpiles of the metal with traders and a lot of old silver is being brought to the market.”
Silver fell 0.6% to $19.67 an ounce at 1.59pm in Mumbai, compared with a 27-year high of $20.59 on 3 March.