Gold imports may drop 15% in September as festive buyers turn to old-gold exchanges
High prices and volatility are expected to curb fresh gold purchases in India. Jewellers say old-gold exchange, now 45-50% of business, could rise to 60-70% during the festive season, supporting demand without equivalent new imports.
What happened
Jos Alukkas · India's gold imports may decline 15% in September after PM Modi urged restraint on discretionary gold purchases. Jewellers expect old-gold
Key facts
- Gold imports are expected to fall about 15% in September
- Nearly 45 tonnes of gold were imported in August
- India has an estimated 31,000 tonnes of idle gold
- Old-gold exchange currently accounts for 45-50% of jewellers' business and could rise to 60-70% during the festive season
- Jos Alukkas has 67 stores in South India
- Gold fell nearly 1.8%
- Gold slipped below Rs 1.5 lakh per 10 grams on MCX
- MCX accumulation zone: Rs 1,47,700-1,48,000
Why this matters
The growing 60–70% exchange mix strengthens the case for partnerships or acquisitions in gold recycling, assaying, refining and trade-in technology.
What to watch
- Daily and weekly domestic gold-price volatility, especially moves that raise the consumer's net upgrade cost.
- Old-gold exchange share of festive sales crossing 60% and the resulting availability of recyclable metal.
- India monthly gold-import data, bullion premiums and domestic-versus-imported gold price spreads.
- Jewellery gram-volume growth versus sales-value growth at organized chains.
- Festival-period footfall, conversion rates and average net cash paid after exchange.
- Making-charge discounting, lightweight-product mix and studded-jewellery mix.
- Rupee movement, import-duty changes and any regulatory changes affecting gold recycling or hallmarking.
- Expand old-gold exchange capacity, including in-store purity testing, instant quotations and rapid settlement, ahead of peak festive traffic.
- Promote lightweight, studded and value-added designs that reduce customers' incremental cash outlay while protecting making-charge realization.
- Increase recycled-gold sourcing, refining partnerships and inventory controls to reduce dependence on imported bullion and limit price-volatility exposure.
- Track sales by gram volume, exchange share, average ticket, net cash contribution and making-charge revenue rather than relying on nominal revenue growth.
- Use hedging and shorter inventory cycles to manage gold-price swings; avoid overstocking fresh bullion if exchange inflows accelerate.
- Target exchange customers with upgrade offers, loyalty credits and financing for the net purchase value to convert replacement transactions into higher-margin sales.