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India Show Meets Low Expectations
Aug 27, 2012 6:43 AM
By Avi Krawitz, Dilipp S. Nag
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RAPAPORT... The India International Jewellery Show (IIJS) closed on Monday with exhibitors satisfied that trading met their expectations -- however low they were. While the show did not signal a significant boom in diamond demand, it helped raise confidence among diamond dealers ahead of Diwali in November and the local wedding season. Buyers continued to focus on filling orders, but retailers were signaling some intention to raise their buying activity in the coming weeks as they prepare for the festival.
Here are some of the trends that emerged at the show:
• There was good demand from Indian buyers for low-color, VS2-SI clarity diamonds, but demand for better-quality VVS stones remained weak. Now there is some concern of a pending shortage of round, SI and lower, Triple-Ex goods. Overall, there was good demand for fancy shape stones, particularly pear, heart, princess and emerald cuts. Cushions remained strong for the U.S. market.
• Gold jewelry sold well, although there is a shift toward lighter-weight items as consumers manage on tighter budgets. The volatile rupee, and its effect on local gold prices, remains a core concern among Indian jewelry wholesalers and retailers.
• International exhibitors at the show had a tougher time and noted that the new 2 percent import duty on polished diamonds has put them on an unleveled playing field in the Indian market. They also felt that the U.S. is still the best market for them at the moment.
• Indian suppliers report that Chinese buyers are starting to inquire for goods again after not hearing from them in the past two to three months. Diamond manufacturers remain cautious due to high rough prices and low profit margins. Large Indian manufacturers are holding relatively high inventories of polished diamonds as they have maintained their operations in an attempt to avoid losing workers.
• Conditions have proved more difficult for smaller manufacturers to manage, with some having closed their doors. Liquidity is tight, but has improved after major mining company sightholders limited their rough purchases in the past few months.
• Overall sentiment improved during IIJS but remains cautious ahead of the September Hong Kong show, which begins on September 19.
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Tags:
Avi Krawitz, Avi Krawitz, Dilipp S. Nag, IIJS
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