Indian households are selling old gold at the fastest pace in years after prices hit record highs, cashing in on the rally rather than selling under duress. The wave of recycled metal is easing India's dependence on imports even as global prices have pulled back sharply from their peak.
Indian households sold nearly 50 tonnes of old gold in the April-June quarter, a 43% jump year-on-year, as record prices tempted owners to cash in idle holdings. Domestic prices climbed from around Rs 79,390 per 10 grams at the start of 2025 to over Rs 1 lakh within months, handing large gains to families that had accumulated the metal for generations.
Experts tie the selling mainly to profit-booking rather than distress. According to Renisha Chainani, Head of Research at Augmont: "Households are predominantly profit-booking, not distress-selling", with prices easing from a record Rs 1.8 lakh to Rs 1.4 lakh per 10 grams and some fear of a further drop toward Rs 1.2 lakh.
Recycled supply eases the import bill
Because domestic mining is negligible, India meets over 99% of its gold demand through imports. The country imported 721 tonnes worth $72 billion in 2025-26, so more recycled metal at home can trim that bill. Recycled gold contributed an estimated 125-150 tonnes in 2025, with projections of 200-250 tonnes in 2026 if the trend holds, against annual demand of roughly 700-800 tonnes.
Chainani said higher recycled supply could moderate import dependence and ease the trade deficit. Saumil Gandhi, Senior Analyst at HDFC Securities, said higher recycled supply can temporarily reduce the need for fresh imports when jewellery demand stays subdued, though he noted recycled supply has limited influence on global prices, which are driven by factors such as US monetary policy, central bank buying and ETF flows.
Buyers wait for a dip
The rush to sell has reshaped the jewellery trade. At Kalyan Jewellers, old gold exchange historically contributed around 30% of business but has risen to nearly 40-45% after recent campaigns. Meanwhile jewellery demand fell about 24% year-on-year to 430.5 tonnes in 2025 as elevated prices deterred fresh buying.
Chainani said Indian gold demand remains structurally resilient, arguing a correction toward Rs 1.2 lakh could revive demand, especially ahead of the festive and wedding seasons. Indians, she added, typically treat dips as buying opportunities rather than exiting the market.
Source: Deccan Herald
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