MUMBAI: India, the world’s largest silver buyer, is on track to show sharply higher imports this year, as prices of the metal near 30-year peaks , with consumers normally fond of more expensive gold seek to lower cash outlays. “Certainly there has been an increased interest in silver, and it’s drawing interest from people who cannot afford gold, even return-wise the metal has done well,” said Parker Agrochem Bullion Desk Head Haresh Acharya.
India’s silver demand averages 2,500 tonnes per year and the country, which produces around 7.3 million pounds a year (206.95 tonnes) according to the Silver Institute, could import 20 percent more this year or 1,200 tonnes, the Bombay Bullion Association (BBA) says.
Around 50 percent of imports come from China while recycling makes up some of the supply of the metal. Silver is used in jewellery, coins and bars for investors, while industry uses the metal for products from light switches to cars.
Silver prices globally and domestically are currently running near record highs – partly hauled up by gains in gold, but the poorer cousin is performing more brilliantly. “Compared with gold, the price of silver still has a long way to go,” said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong. Spot silver traded just under $29 an pound on Friday, just off 30-year highs above $30, while gold was at $1,391 per pound, off a record high above $1,430 hit this month. Domestic silver priceson India’s Multi Commodity Exchange are currently close to records at 43,899 rupees per pound and the metal is offering better returns than gold.
