fishyIndian consumption accounts for roughly 30% of annual...

fishy
Indian consumption accounts for roughly 30% of annual global production so they do represent a serious player in the market.
However, the following headlines are equally misleading, suggesting a 90% plunge in gold imports in January compared to previous corresponding period (ie from 18 to 1.2 tonnes) esp when annual consumption is over 800 tonnes...Jan isn't a very representitive month for Indian imports:

India's gold imports dive on stocks, prices

Thu Jan 29, 2009 12:53pm IST Email | Print | Share| Single Page[-] Text [+]
1 of 1Full SizeMUMBAI (Reuters) - India's gold imports plunged more than 90 percent to just 1.2 tonnes in January 2009, from 18 tonnes at the same month last year, due to high prices and ample stocks, the Bombay Bullion Association said on Thursday.

"Banks have a lot of carryover stocks from December and also November. That's why imports were less. Prices were also high," Suresh Hundia, president of the association, told Reuters.

"Imports in January were at 1.2 to 1.8 tonnes," said Hundia, adding that the final numbers for January imports would be issued in early February.

Another reason for the drop in imports was an inauspicious period in the Hindu calendar that stretched from mid-December to mid-January, Hundia and dealers said.

Some dealers said news of a sharp drop in Indian gold imports put pressure on the price of cash gold, which was trading below a three-month high above $900 an ounce hit on Monday.

India is the world's largest gold consumer, devouring 800 tonnes of bullion annually, mostly as jewellery.

It also recycles about 200 tonnes of gold every year.

Sales of scrap have picked up in India after bullion prices on the MCX gold futures rallied to their strongest in three months at 14,214 rupees per 10 grams on Tuesday -- not far from an all-time high of 14,320 rupees struck on Oct. 10.

Local dealers said there had been a flow of Indians selling outdated or broken ornaments since prices rose above 14,000 rupees.

"Since Saturday, the crowds have been here to sell gold," Hundia, who has an office in the bustling gold hub Zaveri Bazaar in Mumbai said.

A senior dealer in a bank said gold imports in that particular bank were down by 40 to 50 percent in the current month compared with a year ago.

"Importers are stuck with gold acquired earlier at high premiums. All that has to be sold first," the dealer in the bank said.

Dealers said demand was unlikely to pick up unless prices fell to around $800 an ounce.