Gold prices 2026: Silver surge reshapes India exports

Changing consumer preferences are showing up in trade data

Global buying behaviour in jewellery is shifting as elevated precious metal prices and economic uncertainty push customers toward more affordable options. In the latest trade data, India’s gems and jewellery exporters are seeing weaker demand for traditional gold-heavy lines and better traction in categories linked to lower ticket sizes. The pattern described by industry data points to greater interest in silver jewellery, platinum pieces, and lab-grown diamonds, while plain gold jewellery continues to lose ground. For exporters, the shift matters because product mix changes working capital needs, gold procurement requirements, and margins. It also matters for investors tracking the sector because headline export numbers can mask large moves within specific categories.

May 2026 export totals show a mixed picture across releases

May 2026 export reporting in the sector shows divergent totals across different updates cited in the material. One data point reported overall gems and jewellery exports falling 2.49% year-on-year to $1.410 billion in May 2026. Another update said May exports declined about 2% to $1.050 billion from $1.100 billion a year earlier, attributing pressure to gold scarcity and uncertainty linked to the United States-Iran conflict. A separate line stated gems and jewellery exports increased 6.66% in May 2026 to $1.530 billion, indicating steady demand in key international markets.

Because these figures are presented together without a single consistent definition, they should be read as different reported totals rather than a single reconciled number. What is consistent across the updates is that gold-linked categories were under pressure, while affordability-driven categories recorded strong growth.

Plain gold jewellery exports take the sharpest hit

Gold jewellery exports remained the weakest segment in the reported breakdown. Total exports of plain and studded gold jewellery fell 14.75% year-on-year to $1.758 billion in May. The fall was led by plain gold jewellery, with May exports down 29.39% to $1.295 billion.

The stress is even clearer in the cumulative numbers. Over April to May, shipments of plain gold jewellery declined 40.11% year-on-year to $1.636 billion, compared with $1.060 billion in the same period last year. The material links this trend to high gold prices and cautious spending by international buyers, along with constraints in gold availability for export production.

Studded gold jewellery is relatively more resilient

Studded gold jewellery showed a different trajectory. In May, studded gold jewellery exports slipped 1.79% year-on-year, a much smaller drop than plain gold. Over April to May, cumulative studded gold jewellery exports rose 6.71%, supported by demand for lower-carat products that are relatively more affordable.

The divergence between plain and studded categories highlights an important mix shift: buyers appear more willing to spend on value-added designs or optimise spending through lower-carat offerings rather than purchase higher-weight plain gold items when prices are high.

Silver jewellery emerges as a clear bright spot

While gold jewellery struggled, silver jewellery exports strengthened sharply in the period referenced. The material states that silver jewellery shipments jumped over 172% to $1.366 billion (April to May), reflecting a clear affordability-led substitution trend. This is consistent with the broader narrative of consumers favouring lower-cost precious jewellery amid uncertainty.

For Indian exporters, silver’s surge can help partially offset weakness in gold, but it also changes the economics of manufacturing and inventory. Silver products typically involve different sourcing patterns and can have a different margin profile compared with gold-heavy exports.

Gold imports fall sharply after April spike

India’s gold import bill moved sharply month-on-month. Gold imports fell by $1.210 billion to $1.420 billion in May 2026, down from $1.630 billion in April 2026. The drop came after a spike the previous month.

On the production side, the GJEPC chairman Kirit Bhansali said tightening of gold imports has affected the availability of gold required for manufacturing export orders. The same update noted that gold consumption for export production fell 21% to 11 tonnes during April and May, compared with 14 tonnes in the year-ago period.

Prices and input costs set the backdrop

The price environment described in the material is unusually elevated. The average gold price during April to May 2026 increased to $1,723.88 per troy ounce from $1,242.48 per troy ounce in April to May 2025, a year-on-year increase of 45.69%. Alongside price, the sector is described as facing rising input costs, limited availability of gold for export production, and regulatory bottlenecks affecting supply through banking channels.

These conditions typically compress demand for plain gold products most directly, because the ticket size rises quickly with price, and consumers can delay purchases without sacrificing utility.

Diamonds, lab-grown and the wider slowdown signals

Beyond gold, the material also includes data on diamonds and lab-grown stones, showing pressure in parts of the value chain. One update said India’s monthly polished diamond exports slumped 35.5% in May, falling to $1.950 billion from $1.470 billion. The same set of figures noted lab-grown exports declined 32.8% in May to $1.081 billion.

At the aggregate level for April to May 2026, India’s gem and jewellery exports were reported down 6% year-on-year to $1.270 billion, compared with $1.550 billion. The material also noted overall exports grew 3.99% in rupee terms despite a 6.03% decline in dollar terms.

Tariffs and the US market remain a key variable

A separate section in the material points to tariff-driven disruption in the United States, India’s top customer. It states that India’s gems, jewellery and watch exports fell 3.3% in fiscal year 2025/26 to $17.720 billion, the lowest level since 2020/21. Shipments to the US reportedly dropped 45% year-on-year to $1.090 billion, affected by reciprocal duties and a further 25% additional duty on Indian products. Cut and polished diamond exports were reported down 8.5% annually to $12.160 billion, the lowest level in over two decades.

Key data points at a glance

Why the shift matters for the sector

The numbers point to a market where product affordability and availability are increasingly shaping trade performance. Plain gold jewellery is being hit on both fronts: higher gold prices raise consumer ticket sizes, and supply constraints limit manufacturing throughput. Meanwhile, the resilience in studded gold jewellery and the sharp rise in silver jewellery exports suggest exporters are finding demand where buyers can manage budgets through lower-carat gold or switch to silver.

For companies, this mix shift can influence procurement strategy, inventory risk, and hedging practices. For the broader economy, the GJEPC’s note that strengthening exports is critical for the balance of payments and the current account deficit highlights why export momentum remains closely tracked.

Conclusion

India’s gems and jewellery exports show clear stress in plain gold jewellery, with April to May plain gold shipments down 40.11% year-on-year to $1.636 billion, while silver jewellery rose over 172% to $1.366 billion. May gold imports also fell sharply to $1.420 billion after an April spike, reinforcing the supply-side constraints cited by the trade body. The next signals for the market will come from upcoming monthly export releases and any changes in gold import availability through banking channels, alongside developments in tariffs and global demand conditions.