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Israel
By Deena Taylor
Market sentiment across the Israel Diamond Exchange (IDE) turned cautious following subdued trading activity at the JCK Las Vegas show. Almost 100 Israeli companies participated in the show, with 47 companies operating booths in the Israeli Diamond Pavilion. Another 50 Israeli companies were present at other locations throughout the show floor.
Most Israeli dealers in attendance who spoke with Rapaport Magazine noted that despite a relatively quiet show, demand for goods was steady. While trading was better than expected for some companies, it didn’t provide the overall boost to the market that IDE was hoping for and exhibitors noted that any attempts to raise prices in an effort to support better margins were not effective.
Itzik Eliyahu, who is responsible for manufacturing and rough purchasing at Eliyahu Yona Diamonds Ltd., a manufacturer of high-end round and fancy diamonds in all sizes, was a first-time exhibitor at JCK. He noted that traffic at the company’s booth was minimal. Eliyahu said that his booth location, in the second half of the Israeli Diamond Pavilion located at the back of the exhibition hall, made it difficult for potential buyers to find the company.
While the Israeli Diamond Pavilion, which was located at the entrance to the exhibit hall, was large and ran across the entire hall, approximately 12 Israeli companies were cut off from the rest of the pavilion by exhibitors from other countries. “Our location was really bad, but we can say we had a fairly successful exhibition. Traffic was very low, but in the end, we worked it out,” Eliyahu said. He added that there was high demand for lower-color, lower-clarity goods and high demand for fancy yellow diamonds in all sizes.
One manufacturer of fancy shape and round diamonds, who asked to remain anonymous, also had a booth in the Israeli Diamond Pavilion and noted that although some buyers were interested in VVS goods, VS to SI diamonds were more in demand this year. While buyers were quick to admire the assortment of diamonds on offer from Israeli dealers, exhibitors reported they were only interested in making purchases to fill specific orders rather than to build inventory.
The seller said, “Recently, I’ve seen at shows that people come only to fill their requirements. If you show them nice goods that they don’t require at the moment, even if it’s a bargain, they won’t buy.” As a result, the company doesn’t necessarily keep special goods available specifically for shows, and tends to offer commercial goods, which fetch a better price.
However, Jack Gutwirth, the manager of the certificates department at EZ Diamonds, a manufacturer and distributor of small excellent-make round diamonds from .75 carats and less, confirmed that buyers made a number of purchases from the company at the show, with VS and SI goods being especially popular.
Itay Rabih, a partner in R.D.S. Diamonds, a diamond manufacturing and wholesale house that manufactures from .50 carats up in all shapes, explained that sales at JCK were good, but he stressed that the show, in essence, served as an important platform for meeting new clients. “The show was okay. It wasn’t too busy, but I met some new clients and that’s quite important to me, to meet clients and not only to sell,” he said. According to Rabih, there was good demand for Gemological Institute of America (GIA)-certified 1-carat to 10-carat stones, mostly in fancy shapes, such as princess, radiant and cushion cuts, with some rounds in demand as well.
Another dealer explained that although new buyers bought stones, it was not clear if they would remain long-term customers as they only seemed interested in making the purchase based upon their immediate needs.
Following JCK, traders said activity at the bourse remained relatively quiet, which has been the trend since April. While price and demand appeared to be stable, some dealers in the bourse remain frustrated by the long turnaround time of goods being sent to the Gemological Institute of America (GIA) for certification. Manufacturers, including Gutwirth and Rabih, indicated that they now think twice about sending stones to GIA, as the lengthy delay in certifying is negatively impacting the pipeline. In response to the delays, one dealer explained that some clients are willing to buy goods without certificates.
The focus in the diamond exchange next shifted toward the Hong Kong Jewellery & Gem Fair, which took place June 19 to 22. A large delegation of over 68 Israeli companies exhibited at the show at the largest IDE Diamond Pavilion to date, indicating the importance of the Hong Kong market to the local industry.
Asia is Israel’s second-largest market for polished diamonds and accounts for 35 percent of total polished diamond exports, with the greatest share going to Hong Kong. In 2013, Israel’s polished diamond exports to Hong Kong totaled $1.6 billion, according to the Israel Diamond Institute (IDI).
Article from the Rapaport Magazine - July 2014. To subscribe click here.
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