Thomson Reuters GFMS calculations indicated U.S. gold jewelry imports rose in the second quarter at the slowest rate since 2012. However, imports of silver jewelry posted their biggest rise in more than a year.
Worldwide demand for gold dropped by 12% in the second quarter of this year with a decline in almost all sectors and regions, according to a World Gold Council (WGC) quarterly publication. The decline was largely due to lower consumer demand in India and China, the WGC said, noting that “these markets accounted for almost half the fall in global demand” over the period.
Gold jewelry hallmarking centers in India are questioning the authenticity of the World Gold Council's (WGC) data on India hallmarked jewelry after the WGC claimed that just 30 percent of India's jewelry is hallmarked. In a study called Developing Indian Hallmarking – A roadmap for future growth, the WGC said, “Since the introduction of hallmarking standard in 2000 by the Bureau of Indian Standards (BIS), India has made good progress in developing its hallmarking system. However, only 30 percent of Indian gold jewelry is currently hallmarked.”
As the Indian International Jewellery Show (IIJS) passed its fourth day on Sunday, loose diamond sales remained largely flat. In previous years, transactions typically rise over the course of the show, particularly at the weekend. Visitors to the trade fair had very specific and limited demands. However, gold jewelry manufacturers were seeing strong demand due to the recent decline in the price of gold and were replenishing their stocks of gold jewelry to cope with the demand.
Mining firm Mwana Africa is to recommence underground mining at its Klipspringer diamond mine in South Africa and look at the feasibility of reprocessing residues at the mine after its profits slumped as a result of dropping global prices for gold and nickel.
With the price of gold currently setting at five-and-half year lows, the influential Deutsche Bank forecasts prices will drop further to around $750 per ounce. Gold has slumped to just under $1,100 an ounce with worried investors waiting for news that will give it a fresh direction.
"Gold would need to fall towards $750/oz to bring prices in real terms back towards long-run historical averages," according to a new report from the investment bank.
The World Bank's Commodity Markets Outlook report published on Wednesday forecasts that the prices of all major commodities will like decline this year. In the jewelry industry, prices of precious metals, specifically gold, silver and platinum, will decline 9 percent in 2015 mainly as a result of lower investment demand. The bank forecasts gold prices to fall 12 percent this year, mostly due to expected interest rate hikes by the U.S. Federal Reserve.
With the price of gold falling to a five-year low, and seen further declining, Indian jewelry firms have seen their stock prices jump by as much as 14%. Lower gold prices are seen as leading to an increase in consumer demand for gold jewelry during the Diwali festive season in November. Gold is trading at around $1,100 per ounce on global markets, just below the level it saw in July 2010, and down significantly from $1,300 a year ago and $1,900 in mid 2011.
The price of gold on global spot markets plunged on Wednesday after the US Federal Reserve Chair Janet Yellen again pointed to the likelihood of an interest rate rise this year. The price of gold and the level of the US dollar operate inversely, and a rise in interest rates would lead investors to put their money into the greenback, thus causing its value to rise.
Switzerland is the largest conduit for global gold exports with a number of refineries specialising in importing good delivery gold bars and other gold items, remelting and re-refining them and shipping them out again in the sizes more acceptable for the wholesale trade in gold bullion in the principal markets around the world. The figures cited make it clear that China (combining Hong Kong and Mainland China) was the largest importer of gold from Switzerland last year at around 34%, followed by India at 27%.
The U.S. consumer price index (CPI) for jewelry declined by 3.6% on the year in May to its lowest reading since December, with falls in prices of polished diamonds and precious metals being behind the decline. Gold prices in May were down around 8% from a year ago, while platinum, which is still under pressure, was down 21%, and silver 18% lower from May 2014. Meanwhile, the CPI for watches appreciated by 1.8 percent to the highest level seen for May.
The CPI for all consumer goods in May was flat, showing a decrease of 0.04 percent from a year ago.
Mining production jumped by 7.7% from year a year before in April, with the highest growth rate of 81.6% posted in the platinum group metals (PGMs) sector. That was due to the work stoppages a year before when the sector was adversely affected by several months of industrial action.
National Bureau of Statistics data also showed that total sales from January to April increased by 4.9% to $16.9 billion compared with the same four months of 2014.
Better-than-forecast US figures on Friday have raised expectations that the US Federal Reserve will starting increasing interest rates later this year for the first time since the 2008 financial crash. Gold for delivery in August – the most active futures contract – fell to a low of $1,161 shortly after the release of the data before recovering to $1,167. The price of gold falls when interest rates rise since gold is non-income producing while higher interest rates makes income from bonds more attractive.
In what is probably a first for the diamond and jewelry industry, organizers of the Jewelry Industry Summit due to take place in New York next March are attempting to raise money for the event via crowdfunding site Indiegogo. The summit will address sustainability and responsible sourcing. The event’s fund-raising goal is $30,000; as of now $4,735 has been raised.
Driven by the declining price of platinum on world markets and growing demand for bridal jewelry and chains made of platinum, sales of jewelry made from the white metal jumped 30% in the April-May two-month period from a year before, comfortably outpacing gold jewelry sales.
The gold mining industry around the world directly and indirectly contributed $171.6 billion to the global economy in 2013, according to a study by the World Gold Council. The study finds that although the gold mining industry directly contributed around $83.1 billion in 2013, a seven-fold increase since 2000, the indirect economic impact increases the figure to $171.6 billion.
The Hong Kong-based retailer said the PT950 platinum jewelry collection of pendants and rings was created for Chow Tai Fook’s customers in Singapore.
The country's Central Board of Excise and Customs has cut import tariffs on gold and silver to $385 per 10 grams and $544 per kg, respectively, from $398 per 10 grams and $567 per kg. The import tariff value is revised every two weeks taking into account global prices.
According to The Times of India, gold smuggling in India crossed the $1.5 billion mark for the first time in a single financial year with customs, police and revenue agencies seizing more than 3,500 kg of gold in 2014-15. The figure has jumped since the government increased duty on gold to 10% in 2013 in a bid to slash its soaring current account deficit.
Peter Major, a mining specialist at Cadiz Corporate Solutions, warns against assuming current conditions will prevail since the mining industry in the country has changed so much over the last few decades that the old rules no longer apply. “South Africa is the world’s richest country in terms of mineral resources. We have more resources than Russia and the US combined. This was the greatest mining country in the world for 100 years, but it’s not anymore.”
The precious metal has been above the $1,000 level since February 2009 and is now trading at around $1,170 but is on a downward trend and could test the $1,000 level benchmark this year, according to the latest Platinum and Palladium Survey from Thomson Reuters GFMS.
Demand for jewelry remains the most important component of overall demand, although it was 3% lower on the year in the quarter. "There were pockets of strength across a number of South East Asian countries – including Malaysia, Indonesia, South Korea, Thailand and Vietnam."Jewelry demand in India was up 22%, while the US rose 4%., however there were declines in Turkey, Russia, the Middle East and China.
A new report by Global Witness and Amnesty International claims that more than three-quarters of U.S. publicly traded companies analyzed by human rights groups are failing to adequately check and disclose whether their products contain conflict minerals from Central Africa.
The report, Digging for Transparency, analyzes 100 conflict minerals reports filed by companies including Apple, Boeing and Tiffany & Co under the 2010 Dodd Frank Act (Section 1502), known as the conflict minerals law. The findings point to alarming gaps in U.S. corporate transparency.
Gaetano Cavalieri, President of the World Jewellery Confederation (CIBJO), cited the figure at the organization's annual congress.
The GFMS Metals Research and Forecasts team at Thomson Reuters reported that gold jewelry consumption worldwide fell by 6.7% on the year to 527 tonnes in the first quarter of this year, the lowest first quarter level since 2012. The trend was in the opposite direct in India, however, with jewelry demand up 2.0% on the year.
It's stronger, does not wear off (unlike white gold) and is cheaper, but will those reasons be enough for the white metal to displace gold.
The Conflict-Free Sourcing Initiative has published its new Conflict Minerals Reporting Template. Established in 2008 by members of the Electronic Industry Citizenship Coalition (EICC) and the Global eSustainability Initiative (GeSI), the CFSI has grown into one of the largest resources for companies addressing conflict minerals issues in their supply chains.
Retired Italian professional road cyclist Mario Cipollini has a $54,000 luxury bicycle set with 17 carats of black and white diamonds and featuring 40 grams of 18K gold and 122 grams of platinum.
Despite the economic slowdown in the country, China will continue to buy large amounts of gold, said Frederic Panizzutti, chief executive of precious metals trader MKS (Switzerland) SA.
Industry organization Platinum Guild International says in its '2014 Retail Trade Barometer' study that bridal and gem-set jewelry posted an 11% rise in sales. The rise was due to the rising popularity of the platinum bridal culture among young consumers, speedy urbanization in lower-tier cities and the ongoing rise in disposable income among urban dwellers.
Gold recycling in Asia is expected to gain ground as China and India continue to be major centers of global gold demand, according to a recent report by the World Gold Council and the Boston Consulting Group.
A session on the regulation of conflict minerals at the BaselWorld show by the Responsible Jewellery Council was attended by 45 delegates from many diamond and jewelry industry related organizations including CIBJO, BJOP, the GIA, Cartier, Signet, and representatives of banks and NGOs.
With the price of gold and diamonds and other gemstones high, it appears that consumers are continuing to plump for silver jewelry which gives them lower price points and provides jewelry retailers with better margins.
UK hallmarking showed positive gains across all precious metal categories in February, according to figures compiled from all four assay offices by Birmingham Assay Office.
As gold imports fall, the government may reduce the gold import duty by 2-4% in the national budget, sources say.
The sub-continent's jewelry industry is finding it difficult to secure bank loans in order to buy gold – and that is hitting their operating margins hard.
Strong rises on the year in the final two months of last year boosted the country's platinum jewelry imports seen even further, with imports of 1,156 kilograms compared with 719 kilograms in 2013. Interestingly, France accounted for 61% of import volumes last year.
After record-breaking gold purchases in 2013 followed by a flat 2014, the World Gold Council is cautiously optimistic that this year will prove to be more positive.
The European Union (EU) is considering legislation that would regulate the importation of conflict minerals tin, tantalum, tungsten and gold into the EU, containing proposals for a voluntary self-certification process. The new legislation is expected at earliest by the end of 2015 but most likely the legislative process will continue in the next year.