World Gold Council releases new report: Developing Indian Hallmarking
A national hallmarking system is an essential component of a successful gold monetization scheme in India according to the World Gold Council.
A new report, Developing Indian Hallmarking – A roadmap for future growth, released today by the World Gold Council, finds that improvements to the hallmarking system in India are essential to a successful gold monetization scheme.
The report provides an in-depth assessment of the current Indian hallmarking system and a summary of international best practice methods. It recommends a number of steps to enhance the current system which, if implemented, would rebuild trust in the purity of Indian gold, giving consumers greater confidence in the caratage of their gold purchases.
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The report also finds that an increased confidence in Indian gold, which a rigorous and consistent nationwide scheme would deliver, has the potential to increase the country’s gold exports from an existing US$8 billion to US$40 billion by 2020.
Since the introduction of a hallmarking standard in 2000 by the Bureau of Indian Standards (BIS) India has made good progress in developing its hallmarking system. However, only 30 percent of Indian gold jewelry is currently hallmarked. There are widespread differences in purity and an average under-caratage of anywhere from 10 percent to 15 percent.
The report highlights that a lack of BIS-recognized hallmarking centers across the country is also likely to have an impact on the successful implementation of the Indian Government’s gold monetization scheme which is dependent upon the collateralization value of gold.
Commenting on the launch of the hallmarking report Somasundaram PR, Managing Director, India, World Gold Council said: “A credible hallmarking system with a widespread presence of assaying and hallmarking centers is essential for both the gold jewelry industry and for the implementation of a successful monetization scheme. Hallmarking is to jewelry what ’know your customer’ norms are for financial services it is essential to the success of the jewelry industry in a world where consumers seek transparency, quality and consistency and is critical to building consumer trust and confidence.
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The trust and confidence which comes with a credible nationwide hallmarking system will underpin the growth of gold jewelry exports, boosting the Indian industry’s credibility in the global jewelry sector. It is a fundamental requirement if the industry wants to have a bigger role in the ‘Make in India’ ambition and eventually position India as “jeweler to the world’. In addition, the quality of gold would be a critical element for the success of the gold monetization scheme”.
The report recommends that India’s current hallmarking model, built around independent hallmarking and assay centers, should be retained. In addition it recommends six key actions which should be taken to improve the efficiency and effectiveness of the current system:
• Strengthen governance around hallmarking processes
• Drive customer awareness of hallmarking
• Incentivize and facilitate targeted expansion of hallmarking centers
• Use BIS data to develop a ratings system for jewelers
• Pilot BIS’ Unique ID scheme or other technology solutions to support hallmarking
• Pursue membership of the International Hallmarking Convention or develop an Asian alternative.
In the long term, the report recommends hallmarking should be made mandatory and recommends a transition to a manufacture-driven system which would drive consolidation within the unorganized jewelry manufacturing industry. Furthermore, the report is clear the development of a more stringent system would deliver huge benefits to the Indian gold market including: increased trust amongst overseas buyers and financial markets, resulting in a larger export market, a stronger domestic market and job creation across the spectrum.
View the entire report here.
Lithium producers bullish as EV revolution ramps demand
Rising demand for lithium is stoking prices for the electric vehicle battery metal, fueling long-delayed expansions that still may not produce adequate supplies that automakers need to meet aggressive production plans.
Growing industry optimism from higher lithium prices is a change from last year when funding for mines and processing plants dried up during the pandemic.
Albemarle Corp, Livent Corp and other producers are scrambling to make more lithium, but some analysts worry the recent price jump will not spur a big enough expansion to meet a planned wave of new EV models by mid-decade.
Since January, General Motors Co, Ford Motor Co LG Energy Solution and SK Innovation Co, along with other automakers and battery parts manufacturers, have said they will spend billions of dollars on EV plants.
U.S. President Joe Biden has proposed spending $174bn to boost EV sales and infrastructure. The European Union has similar plans, part of a rush to catch up with global EV leader China.
Those moves have helped an index of lithium prices jump 59 percent since April 2020, according to data from Benchmark Mineral Intelligence, a commodity pricing provider.
The rising demand “reflects what feels like a real and fundamental turning point in our industry,” said Paul Graves, chief executive of Livent Corp, which supplies Tesla Inc. On Monday, it said it would more than double its annual lithium production to 115,000 tonnes.
Graves warned, though, that “it will be a challenge for the lithium industry to produce sufficient qualified material in the near and medium term.”
Albemarle, the world’s largest lithium producer, aims to double its production capacity to 175,000 tonnes by the end of the year when two construction projects are complete. Albemarle's Q1 profit beat expectations thanks to rising lithium prices. Chile’s SQM, the No. 2 producer, said its goal to expand production of lithium carbonate by 71 percent to 120,000 tonnes should be complete by December.
Australia’s Orocobre is paying $1.4 billion for smaller rival Galaxy Resources, a strategy designed to boost scale and help it grow faster in regions closer to customers.
“The next few years are going to be critical in terms of whether there’s enough available lithium supply, and that’s why you’re starting to see commodity prices start to ramp,” said Chris Berry, an independent lithium industry consultant.
The price gains helped Albemarle and other major producers, including China’s Ganfeng Lithium Co and SQM, post big gains in first-quarter profit and boost forecasts for the year.
Even China’s Tianqi Lithium Corp, saddled with debt due to years of low lithium prices, signaled that recovering demand should help it swing to a profit this year.
Forecasts call for demand for the white metals to surge from about 320,000 tonnes annually last year to more than 1 million tonnes annually by 2025, when many automakers plan to launch new EV fleets, according to Benchmark.
Still, demand is expected to outstrip supply in 2025 by more than 200,000 tonnes, so lithium prices may need to rise to encourage producers to build more mines. That could boost the prices consumers pay for EVs. “Companies across the lithium-ion supply chain are in the best position they’ve been in for the last 5 years,” said Pedro Palandrani of the Global X Lithium & Battery Technology ETF , which has doubled in value in the past year.