Silver Overshadows Gold

September 10, 2013 at 09:07


Silver is replacing costly white gold in key export markets. Silver jewellery studded with diamonds and other gems is increasingly luring the young generation in the US and Europe as it is more affordable in the period of economic uncertainty and volatility.

“The rising prices of gold coupled with the economic slowdown across the world have brought about a change in the consumption pattern. Consumers are favouring white metal jewellery over gold items. Whether in the US or in Europe, sterling silver jewellery has become extremely popular because consumers find them affordable.

Consumers who preferred white gold and platinum jewellery earlier are now switching over to silver,” said Pankaj Parek, vice-chairman, Gem and Jewellery Export Promotion Council (GJEPC). Poland has emerged as one of the leading markets of silver jewellery in recent times.

The US and other EU nations are showing good demand, according to exporters. Exports of silver jewellery in the period April-July this fiscal has increased by 181% compared to FY12.

Silver shines as white gold loses sheen in Europe

In July this year, silver jewellery exports have more than trebled in the corresponding month of the previous year. However, demand for silver statues and antique silver pieces, which were gaining ground in the CIS and eastern European markets have dwindled.

“In last one month there has been no demand for these items in these emerging markets,” said Suresh Hundia of Hundia Exports. The demand for silver jewellery has been spurred by the rising prices of gold both in the international as well as in the global markets.

TM Srinivasalu, one of the leading silver merchants from Chennai said that when international prices of gold were at $1,200 per ounce silver demand was less. “Now the international prices of gold is hovering around $1,400 per ounce and rupee has weakened against dollar and is hovering around 67-68 level. Therefore, yellow metal has become costlier in India as well as in overseas markets,” Srinivasalu explained.

The silver in the global market is hovering around $23.5 per ounce and in India the exchange price of the metal is pegged at Rs 54,000 per kg. Silver exporters based in Jaipur and Delhi say business volume is increasing. European markets are growing and exporters are getting good orders from there.

Spain, for example, is keen to pick up low-value products, while Italy is looking at high value items. The US is placing orders for fashionable high-value products. “The situation is much better compared to FY12,” said Harsh Derewala, director of Jaipur based DWS Jewellery.

The GJEPC vice-chairman said leading retailers in the US, who earlier used 14k gold for popular products like diamond-studded bracelets, have now shifted to sterling silver