As noted below, UBS's observations today confirm Ted Butler's recent claim of air freight deliveries of silver to India.

Great start to PM's thus far overnight. Again, the 3:00 am phantom rise in the USD has reversed today. Hopefully, this phantom activity since July disappears completely in time. We will see how PM's do once London closes late this morning as the NY cartel may not be as open to change as their counterparts.

Regards - VHF

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UBS Metals Daily

China Silver Production Growth May Stall Next Year

Author: John Reade

November 10, 2008 4:36:47 AM

We have noted recently that Indian demand of good delivery silver from European banks has increased sharply and have wondered why this was the case. We have not seen much in the way of Indian demand for silver for about five years and had heard from the trade that India was sourcing its silver from China via the export of non-good delivery bars. One client in New York suggested to me that China had turned a net importer and this Bloomberg story appears to support this, although we are having difficulties reconciling the numbers. If China has turned a net importer of silver after years of heavy exports - perhaps due to lower zinc smelter production and as a consequence of export taxes on silver - then the silver market may see yet another change. Over the past decade the sharpest changes in commodity price performance have been seen when China turns from net exporter to importer, or vice versa. This move may lead to silver outperforming gold over the next few months, reversing a period of dreadful relative performance and could see the gold:silver ratio down to 60 from recent levels above 83.