The month of August began on a cheerful note mixed with apprehensions about the outcome of the India International Jewellery Show 2013(IIJS 2013). But IIJS 2013 clearly went one way with jewellery faring much better than loose diamonds. This goes for both the domestic as well as overseas demand. But, market analysts however feel the slow demand for polished goods at the Show may not be the real picture, as post-show deals normally turn out better than what meets the eye. The large number of overseas buyers in the market can vouch for this theory.
The diamond manufacturing sector surely has seen better days, going by the adversely affected small and medium sized units in the cutting centres. This could be because of the nature of their manufacturing plan and set up that is short term. Right from rough inventory to working capital, these smaller units run on a short period plan, resulting in difficulties. While attempts are being made by organisations and Banks to solve their problems, not all is hunk-dory for them, at least now.
But who was holding up the flag up for the Indian diamond manufacturing sector are the larger factories or the bigger players. Though stung by numerous hurdles, they continued to forge ahead with their strong financial strength; and their planned manufacturing and business plans.
Beginning from 2nd week of August, trading in Mumbai was quite active, what with the festival seasons almost upon us here in India. The volatile and weak Rupee of course played spoilt sport and cash crunch and liquidity problems did not help either. And of course rough shortage and high rough price (a perennial problem), added to the somewhat cautious atmosphere in the market.
Meanwhile, the industry leaders are not leaving any stone unturned to maintain their regular business running and fulfill their commitments to their overseas buyers. According to market sources, US demand has picked up very well and demand for goods, especially high end stones has been quite strong. US still remain the highest buyer of diamonds and jewellery from India. Jewellery demand has also picked up from the US, which has jewellery manufacturers working over-time to keep the commitment of supplying their buyers on time.
China, however, remained slow as in the previous month. Asking prices is high according to buyers but with suppliers compromising on prices to an extent, many have closed good details and returned with a smile on their faces. It is to be noted that it is not always that polished suppliers lower the prices because of liquidity problems. Instead, they could afford to sell at such prices as the goods were from their inventory for which they had paid much less in dollars. In other words, they still have made a killing in their polished diamond deals.
Rough trading was steady but cautious during the month. Shortages of goods was the bane the manufacturers had to face. But, as closing the manufacturing units was not an option, given that many lives were dependent on them, owners of affected units did their best to keep them running and retain workers, who had served them well over many years.
The rupee slide throughout the month has had a negative effect on domestic diamond and jewellery market. Rising gold prices and gold import duties/curbs have had retailers crying hoarse. Domestic demand for loose diamonds is fairly good but buyers are cautious. Demand for good quality and bigger stones was fairly good throughout the month but shortages were reported. The oncoming Hindu festivals may be the reason for the polished market picking up, but again prices delayed deals being made, both from domestic as well as overseas buyers.
Locally, jewellers are vying with each to come out with innovative ideas woo the customers during the Festivals this year. Some had gone one step ahead by launching Pre-Diwali Schemes wherein customers pays installments for many months before the festival and purchases a jewellery piece on the auspicious day, with the company footing the last installment. Many local retailers are getting ready with New Collections to be launched for Diwali, where demand for gold jewellery remains steady, whatever the price of gold! According to market watchers, demand for diamond jewellery is picking up pan, contradicting talks of Indian economy slowing down.
During the Month of August 2013, the demand and supply situation was as follows:-
POLISHED: Rounds
0.005-0.15 cts,F-J / SI+,v. good demand, selling very well
1/4-3/8, good demand
1/4-3/4, D-J / SI+, selling well . Shortage of goods
1/2-3/4, white / pique, selling well
0.80-0.90 cts, selling well ; F-J / VVS selling very well ;shortage of good
1.00-3.00 cts,D-K / SI to pique, v. good demand, less goods in market
1.00-3.00 cts, H-J / SI1+very strong demand for good makes
4.00+ cts, H-M / VS+ fairly good movement of goods
Fancy Cuts
Stabbes (wide baguettes), 0.25-1.00 cts, fair demand D-J / VS+, selling well.
Marquises 0.25-5.00 cts, F-J / VS+, good demand
Princesses, Pears2.00-5.00 cts, good demand
ROUGH:
Makeables: very high demand; shortage of goods.
1-5 point: very good demand: makeables. good demand: OW TTLB & TTLC.
6-20 point: good demand: crystals/makeables. Shortage
Fancies:
21-50 point: fancy shapes good demand
0.51-1.00 carat: v.good demand: makeables; crystals.
1.01-2.00 carat: good demand: rounds; crystals, all fancy shapes. Goods not available in market
2.01-3.00 carat: high demand , no goods in market
5.00 carat+: fair demand: $1,000+ makeables, crystals & all fancy shapes
Mixed Lot: very good demand
Aruna Gaitonde, Rough&Polished, Mumbai
