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Hong Kong June Jewelry Show Falls Below Supplier Expectations
Jun 24, 2014 5:22 AM
By Ronen Shnidman
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RAPAPORT... Trading at the June Hong Kong Jewellery & Gem Fair, which took place between June 19 and 22, came in below expectations as the event failed to boost sales during the traditionally slow period of the year. Exhibitors noted that buyers were looking for specific items to fill immediate orders but they avoided inventory purchases.
Suppliers reported that they faced price resistance from buyers, who were generally looking generally for bargains and displayed no real urgency to buy. Sellers were unwilling to lower prices as their profit margins from polished diamond sales have been squeezed by higher rough prices.
“If anybody wanted or needed to buy goods and were okay with the price, they could find them,” said Anshul Mehta, a manager at Rosy Blue, a Mumbai-based diamond manufacturer. “If sellers had dropped prices by 3 percent or 4 percent, much more business would have taken place.”
Exhibitors that focused on selling fine diamond jewelry reported similarly slow activity in their section of the show. Ilan Horowitz, a director at JR Diamonds International Ltd., a Hong Kong-based jewelry manufacturer, said that visitor traffic was very light even compared with the June show last year. “All in all, the show was way below expectations, which were not high to begin with because it is the June show,” he said.
Exhibitors who spoke with Rapaport News noted good demand for diamonds above 3 carats. They also reported continued shift in Far East toward SI and lower clarity goods. In addition, there is continued firm demand for fancy color diamonds and fancy shapes with ovals being particularly strong.
“From what I heard from other exhibitors it was not a very good show, but it all depended on what you had,” said Gaston D’Aquino, the marketing director for M.I.D. (HK) Ltd. “Big sizes were moving well. If you had the right goods [the show] was okay because demand was specific. But it’s not like people are buying inventory like they would do under normal circumstances.”
Show participants reasoned that lower diamond and diamond jewelry sales reflected weaker retail demand in Greater China – including Mainland China, Hong Kong and Macau. Economic growth has slowed in the past year and demand has also been affected by the Beijing government’s anti-corruption campaign and crackdown on gift-giving to government officials.
“The anti-corruption campaign in China is hurting sales,” said Horowitz. “I don't think people lack cash, but for some reason they are not [at the show] buying. I think one of the reasons is that demand in China has dropped, which affects the entire region.”
Exhibitors reported that the majority of buyers at the show were from China with a notable presence of buyers from Southeast Asia, especially from Indonesia and Cambodia.
However, exhibitors said that while visitor numbers were down, they faced stiffer competition to sell their goods as there were more dealers at the show.
According to fair organizer UBM Asia, 1,892 exhibitors participated in this year's June show, a 3 percent increase from last year. UBM Asia said it expected to bring several delegations of 300 qualified Mainland Chinese buyers to the show, while more than 450 diamantaires were expected to exhibit in the diamond pavilion.
“I noticed this time the number of visitors to the show was considerably less and the number of exhibitors has gone up tremendously,” said Mehul Vora, a Hong Kong-based sales executive at Gemasia. “If things used to be a little bit more concentrated at the show, now it is saturated.”
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Tags:
anti-corruption, Cambodia, fine jewelry, Hong Kong, indonesia, June show, large diamonds, Ronen Shnidman
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