Asia’s Shoppers Rush to Redeem Old Jewellery and Coins

by admin | Mar 24, 2025 | gold, jewelry industry, money, precious metals, wealth

With gold prices surging to consecutive record levels, jewelers throughout Asia and the Middle East are facing dimmed luster in their showcases as buyers rush to exchange their used jewelry and coins for cash.

Should the selling pressure persist, it might eventually result in reduced imports into key market areas, which could possibly curb the upward momentum of gold prices, according to statements from retailers and industry specialists.

On March 14, spot gold reached over $3,000 per ounce for the first time, and it kept rising the previous week, resulting in Year-To-Date increases exceeding 15%. This surge was fueled by a potent mix of geopolitical and economic instability.

The impressive surge observed recently followed nearly a 30% increase in 2024, which has boosted the trade for frequently overlooked scrap gold purchasers in Zaveri Bazaar, India’s biggest bullion marketplace.

Unmesh Patel, a textile merchant, mentioned that he achieved a profit exceeding 25% from offloading four 10-gram gold coins within just under seven months following the reduction in import tariffs on precious metals by the Indian administration.

He mentioned, ‘I’ve opted to sell now rather than wait for prices to rise further.’

In India, domestic gold prices have surged over 32% since the reduction of import duties in July, reaching an all-time peak of 89,796 rupees for 10 grams.

“Should prices remain at this level throughout the year, India’s total demand might decrease by over 30% in 2025,” stated Prithviraj Kothari, who serves as the president of the India Bullion and Jewellers Association (IBJA).

” purchasers are struggling to match the pace of rising prices, and their financial limits remain stagnant as well,” he noted.

Wedding season slump

Although India’s wedding season is in full swing, jewellers are seeing less than half their typical customer traffic, according to dealers.

Even individuals like bride-to-be Vaishnavi M., who are buying items, prefer to trade in their old jewelry for new pieces to reduce expenses.

“The costs are extremely high and would significantly disrupt my wedding budget…I am considering exchanging some of my mother’s vintage jewelry instead,” stated Vaishnavi M., who resides in the southern state of Kerala.

Last year, India’s scrap gold supply amounted to 114.3 tons, with the World Gold Council predicting this number to rise by 2025.

India satisfies most of its gold needs through imports, whereas China, being the largest consumer, covers approximately two-thirds of its demand by importing.

According to a bullion dealer based in Dubai, jewellery centers in the Middle East are also experiencing a decline in demand.

The dealer mentioned that many Indian tourists typically shop in Dubai to evade import duties, yet even they are becoming cautious.

Approximately 60% of the gold demand in the UAE is attributed to jewelry purchases. When prices rise, consumers tend to opt for items with less weight, according to Andrew Naylor, who leads the Middle East and Public Policy sectors at the World Gold Council.

He stated that, nevertheless, our findings indicate the worth of jewelry purchased last year went up, even though the quantities were reduced.

In China, the weak retail purchases observed in 2024 persist. According to Peter Fung, the head of trading at Wing Fung Precious Metals, individuals looking merely to possess tangible gold will opt for coins and bars due to additional charges imposed by jewelers for their workmanship.

Other significant Asian markets have similarly experienced a downturn in the demand for gold jewelry, resulting in an excess of sellers over buyers.

Customers are moving toward more affordable jewelry or choosing to liquidate their current pieces.
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Or utilize it as loan collateral instead of making new purchases.

Brian Lan, who leads GoldSilver Central in Singapore, mentioned that nearly half a dozen stores have recently been established near Chinatown, offering products made of gold-plated silver.

“Sometimes, our clients return after going home, searching for jewelry they no longer wear or pieces that are damaged, with the intention of selling them off,” Lan mentioned additionally.

These trends underscore the fine equilibrium between gold’s position as a conventional cultural commodity and its significance as a financial asset.

In the future, experts suggest that the prospects for jewelry demand continue to appear bleak; however, interest in investing in precious metals is expected to stay robust.