Swiss gold exports to China drop 67 pct in April, India down 28 pct

Otmane El Rhazi from The Bullion Desk.

Swiss exports of gold to China dropped by around 67 percent in April to just 15.1 tonnes, according to figures published this morning by the Swiss Federal Customs Administration.

The country’s overall exports of 143.9 tonnes of gold in April were down 36 percent on the March total, which UBS said in a note is in line with the recent slump in physical demand across the Asian markets in particular.

“The more subdued export number might suggest demand in key physical markets is tapering off for now. Indeed, this coincides with other indications of more muted activity in China and India: volumes on the Shanghai Gold Exchange in May are about 19 percent below the average over the previous two months, and premium in India has fallen off of late,” it said.

Exports to India from Switzerland of 51.8 tonnes were down 28 percent month-on-month. The discount on gold in Mumbai recently widened to its lowest this year, sources told FastMarkets last week, which is reflective of the downturn in demand after Akshaya Tritiya in April.

While direct exports to mainland China may have dropped, exports into Hong Kong were up 36 percent to 43.4 tonnes.

UBS attributed the easing in physical demand primarily to seasonal factors.

“Historical activity on the SGE suggests volumes are typically muted in the second quarter, and only tend to pick up again towards the end of the third quarter, heading into the fourth quarter, when local market participants start to build stocks for the Chinese New Year celebration in late January/early February of the following year,” it said.

“In India, seasonal strength has similarly tended to occur around Q3, on the back of wedding- and festival-related demand,” the bank added.

Switzerland imported 203.2 tonnes of gold in April, down 28 percent on March, but the country remains a net importer of gold at 59.3 tonnes.

The country was a net exporter of PGMs, however, shipping out 1.06 more tonnes of platinum in April than it brought in, with most going to Hong Kong. Exports of a net 0.37 tonnes of palladium last month were the first shipments leaving the country since January.

 

(Editing by Mark Shaw)

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