Silver loses shine as rising prices keep buyers at bay

Nagpur: The shining silver coin or miniature idol of a deity, once the preferred choice for gifting and a cherished memento for the recipient for years, is less in demand this Diwali. Silver price has reached Rs 1 lakh per kg while gold is hovering around Rs 80,000 per tola (both including GST).
The rising prices have reduced the demand for silver artefacts like coins or idols of deities to less than half.Khamgaon town in Buldhana district, the hub for silver manufacturing, is witnessing a lull. Manufacturers here say the business has come down to 50%. Rural customers, who have always found silver more affordable than gold, now find even the former out of their reach.
Kamal Jangid of Jangid Group at Khamgaon, whose firm caters to both corporates and smaller jewellers who further sell the silverware in the interiors, said the small jewellers have not turned up this year. "Silver is now out of reach for rural consumers. The corporates — who generally purchase coins and small idols of deities and religious symbols for Diwali gifting — too aren't ordering much. The market is at a low this year," Jangid said.
"With silver touching Rs 1 lakh per kg, a number of corporates are looking for other gifting options," said another manufacturer from Khamgaon.
Pankaj Bakhai of M/s Anantrai and Sons at Itwari in Nagpur said a 10-gram silver coin costs Rs 1,050, and it's Rs 2,300 for a 20-gram idol. It's 25% more than the price during last Diwali. Corporates, which buy on a mass scale but also have a limited budget for gifting, are opting for other items instead of silverware, he said.
Rajesh Thakker of M/s Dipti Jewellers, a bulk trading firm in Akola, said the amount of recycled silver that used to come back to the market has reduced drastically.
Amid rising prices, traders have reported a certain amount of investment buying in both gold and silver. Individuals who invested earlier are not selling at this juncture to book profits as they hope for the rates to rise further. This is also adding to the price rise, said sources.
"Costly silver has impacted the artisans' income. Orders for items like utensils, coins, or idols have come down to negligible levels. What remains is job work for making lighter ornaments like anklets, which is a low-paying job," added Bakhai.
Meanwhile, jewellers also admit an impact on the gold demand due to high prices.