Silver imports surge by 170% in October

AHMEDABAD: The demand for silver has gained tremendous traction of late, especially with increasing restrictions on gold transactions after demonetization. The increase in demand is clearly evident from the imports of silver in Gujarat, which grew by some 170% at 26 metric tonne (MT) against what it was in October 2016 at 9.69MT. In fact, the import of silver in October marginally grew over 25.56MT in September this year.
According to bullion traders, it wasn’t just the festive season but a complete shift in demand when it comes to silver.As prices were also relatively lower, industrial procurement increased which further fuelled the demand for silver.
“After demonetization, the restrictions on gold purchases as well as high-ticket transactions had gone up and therefore, many of the affluent class began investing in silver. Meanwhile, prices also began to stabilize, thus boosting further investments,” said Surendra Mehta, national secretary, Indian Bullion and Jewellers Federation (IBJA).
Mehta also said that silver is the poor man’s gold and therefore, a safe haven for many as an investment option. In fact, according to estimates by bullion traders in Gujarat, some 25% of the total silver consumption has industrial applications. “Whenever the prices are suitable, industries where silver is heavily used tend to stock up. In the past two months, the prices have not gone up as high as they usually are around the festive season and that could also have led to a surge in imports,” said a city-based Bullion trader.