It was said from the Bombay Bullion Association in Mumbai on Wednesday that gold imports declined by nearly 24 per cent in 2009 at 343 tonne, against 449 tonne in 2008.

“The country has imported 343 tonne gold in 2009, compared to 449 tonne in 2008,” Bombay Bullion Association President Suresh Hundia said.

India has remained the largest gold importer in the past few years, but took a hit in 2009 due to soaring prices, he said.

Commenting on price trend, Hundia said gold may see some correction and may touch Rs 16,400-16,500 per 10-gram in the near future.

The precious metal plunged Rs 245 to Rs 16,785 per ten grams at the Mumbai bullion market today on emergence of hectic offloading by stockists and speculators.

The sudden bout of selling was attributed to heavy profit-taking fearing a price correction in the overseas markets following China’s tightening of its monetary policy yesterday, a trader said.

Pure gold (99.9 purity) fell by a similar margin to end at Rs 16,870 per ten gram from Rs 17,115 previously.

It was reported that gold rose for the third time in four sessions on speculation that the Federal Reserve will hold US lending rates low for an extended period, eroding the value of the dollar.

The greenback dropped as much as 0.5 per cent against a basket of six major currencies. Gold rose 24 per cent last year as the central bank kept rates at close to zero percent to spur the economy, helping send the dollar down 4.2 per cent.

“If the Fed foolishly keeps interest rates too low for too long, money is going to flow into gold and commodities,” said Leonard Kaplan, the president of Prospector Asset Management in Evanston, Illinois.

Gold futures for February delivery rose $US7.40, or 0.7 per cent, to $US1136.80 an ounce on the Comex division of the New York Mercantile Exchange. Prices climbed as much as 0.8 per cent and dropped as much as 1 per cent.

The metal may top $US1200 in the first half of the year on demand for a hedge against inflation, said Philip Klapwijk, the chairman of London-based researcher GFMS Ltd.

In 2009, gold rallied for the ninth straight year, reaching an all-time high of $US1227.50 on December 3.

Gold imports by India, the world’s biggest buyer, fell 18 percent to 343 metric tons last year as record prices curbed demand from jewelers and housewives, the Bombay Bullion Association Ltd. said today.

“This is not the time to hold long-term positions,” Kaplan said. “Gold is still just too expensive.”

Silver futures for March delivery rose 29.5 US cents, or 1.6 per cent, to $US18.55 an ounce in New York. The metal is up 74 per cent in the past 12 months.

It was said from smelter officials on Monday that the power operator in Henan province has warned local aluminium smelters that its power supplies to the smelters may fall due to local power shortages.

“The power bureau called us on Sunday asking us to prepare for production cuts at our smelter since the local power supply is tightening,” an administration official at a large smelter in Henan told Reuters.

“I can imagine they would call others.”A manager at another large smelter in Henan said the company had received calls from the power operator on Sunday and Monday about warnings of power supply cuts.

Henan, the top primary aluminium producing province in China, has more than 4 million tonnes a year of aluminium smelting capacity.

China is the world’s top producer and consumer of the metal.

It was reported on Monday that China and Malaysia signed a deal to build large projects in a controversial development corridor in resource-rich Borneo, one of the world’s last great wilderness areas.

Najib Razak, the Malaysian prime minister, said the agreement could result in projects worth $11bn.

As we all know that in recent months, the U.S. has imposed continuous anti-dumping measures against iron and steel products imported from China.

In June, 2009, the U.S. Department of Commerce launched three dual investigations, namely anti-dumping and countervailing investigations, in ten days onto China-made wire trays, steel grating, and stranded steel wire on June 26, June 19 and June 17.

On December 31, 2009, the U.S. International Trade Commission (ITC) made affirmative determination in its final phase countervailing duty investigation on China-made oil pipes, imposing duties from 10.36 percent to 15.78 percent.

On January 5, 2010, the U.S. government slapped preliminary anti-dumping duties on imports of more than 300 million dollars worth on wire decking from China. Tariffs of between 42.61 to 289 percent will be imposed and collected until a final determination is made in the case.

Wu Guohua, an analyst with Hengyang Valin Steel Tube Co. Ltd., one of China’s largest steel pipe producer, noted that the company’s’ export to the U.S. dropped by around 50 percent in 2009. The 2008 figure was 190,000 tons.

The U.S. has so far refused to recognize China’s market economy status. Instead, it chose another country as a substitute to calculate Chinese steel mills’ cost. As a result, China was accused of dumping goods to the U.S. at an unreasonably low price.

Facing mounting trade frictions, Chinese steel producers have started adjusting their market strategies. Baosteel, China’s largest iron and steel maker has ceased its steel pipe export to the U.S. since last April. It signed a cooperation agreement with China National Offshore Oil Corp (CNOOC), striving to expand its domestic market. Hengyang Valin Steel Tube Co. Ltd. chose to cultivate new business in emerging markets in Africa, South Asia, Middle East and Latin America.

Wuhan Iron and Steel Group (Wugang) and Laigang Steel Corp. also expressed their anxiety about the international trade environment, although trade frictions have no severe impact on them. “More steel products may face sanctions in the future. We feel high pressure,” said an official with Laigang Corp.

Li Hongbo, director of Wugang’s sales and marketing center, noted that the U.S. is “over sensitive” to China’s steel export products. “Chinese steelmakers should actively answer the anti-dumping cases, and make more efforts in R&D and market expansion, to avoid probable trade frictions.”

METALLURGICAL Corp of China has approved the purchase of a $US200 million stake in privately held Resourcehouse, controlled by Clive Palmer.

Metallurgical also said it gained approval to undertake engineering, procurement and construction work on a Resourcehouse coal project in Queensland known as China First.

Metallurgical will receive a 4 per cent commission from the sale of 30 million tonnes of coal from the project, it said in a statement.

In November, Mr Palmer said he hoped construction on the coal project would start 2010, and mining would begin in 2013.