By Avi Krawitz
RAPAPORT... Diamond suppliers were hoping for a boost to market confidence as the Hong Kong International Diamond, Gem and Pearl Show opened on Monday. While it was too early to assess actual trading at the show, visitor traffic was quiet in the morning session but picked up in the afternoon.
“The market is looking for confidence,” said one India-based diamond manufacturer. “There are buyers out there but they are unsure of price levels and therefore lack the confidence to buy.”
Exhibitors who spoke with Rapaport News said they expect to obtain a stronger reflection of trading by Wednesday, which will be the third day of the loose diamond exhibit and the opening day of the Hong Kong International Jewellery Show. Diamantaires are hoping the show will signal an improvement in market activity after a prolonged period of caution among polished diamond buyers. Many noted that there is a shortage of some goods given that India-based manufacturers have reduced their polished production by about 30 percent since the October Diwali break.
One manufacturer reported that there is a shortage of 0.50-carat to 0.99-carat, D-J, VVS1-SI diamonds, and steady Chinese demand for these goods. Exhibitors hope that Chinese retailers will return to the diamond market after the Chinese New Year spring festival that ended in late February.
However, exhibitors also felt that the show was too soon after the festival as Chinese wholesalers are only now returning to work and have not yet had time to assess what goods they, or their retail clients, need.
Still, they’re encouraged by reports that jewelry sales were steady during the New Year festival, which is considered the busiest shopping period in China and Hong Kong. Chow Tai Fook, the largest jewelry retailer in the region, reported that its retail sales rose 9 percent year on year during the period February 5 to 22 that encompasses the festival, with gem-set jewelry same-store sales up 62 percent in Mainland China.
While jewelry retailers went into the festival with high inventory levels, exhibitors at the Hong Kong show are hoping that jewelers sold enough in February to spur some inventory replenishment in the coming week and beyond.
“Jewelers haven’t been buying for the past six to nine months so my feeling is that they don’t have stock,” said another India-based manufacturer. “I think the next six months will be better in China.”
The Hong Kong International Diamond, Gem and Pearl Show takes place at AsiaWorld-Expo from March 2 to 6, while the Hong Kong International Jewellery Show will be held at the Hong Kong Convention and Exhibition Centre from March 4 to 8.
A total of 4,300 exhibitors from 52 countries are participating in the two events, according to the Hong Kong Trade Development Council (HKRDC), which is organizing the shows.