The Munich Mineral Show is one of the largest and most important trade fairs for minerals, fossils and gemstones in Europe. Over 1250 exhibitors registered for the three-day 2012 event and, thanks to numerous agreements with museums and mining firms, an astonishing exhibition of rare stones was presented. Among them, a 296 carat rough yellow diamond worth $2.5 million from the De Beers Collection.
Rough & Polished visited the exhibition with special attention to the Gemworld pavilion, where sellers from all around the globe were hoping to kickstart the jewellery business in Europe after years of decline.
Walking around the jewellery stands at the Gemworld pavilion, the first impression that we got was that, after a few years of stasis, customers are finally willing to buy again. Potential purchasers crowded the area and frequently stopped by to ask for information and prices. Renewed interest from the people is a good sign in the jewellery market, but not everyone in Munich was happy about consumers behaviour.
A Colombian emerald dealer based in Thailand showed his disappointment for how the fair was going and confided us that he expected better results in Europe, considering the fact that he had been doing business with Europeans in East Asia for the past months. His superior quality emeralds did not attract many customers, though. “The Problem here” he said “is that people seem more interested in quantity, rather than quality”.
A fancy coloured diamond dealer from Japan also complained about poor business in Munich, but explained that the big problem with his products is that rough scarcity keeps prices too high, preventing sellers from lowering polished prices to meet the request of the customers. As a result, dealers have problems both in buying and selling their products.
Still, a coloured gemstones seller from the United States did not share the same pessimism as his colleagues. He believed that when it comes to quality the European market is much more receptive than the American one: “People here are attracted by premium gemstones, I can see that by how they look at them, and I do not care if they don’t buy because with this kind of products if I manage to sell a piece every two or three days, I am more than happy”, he said.
So, who is right? The pessimists who say that customers are renouncing to quality in favour of better prices or the optimists who say that even in tough times the European market would never compromise on products of inferior quality?
If we consider that The Munich Mineral Show is conceived as an exhibition not only for experts, but also for the general public, it should not be surprising to find tourists and onlookers who, not having a specific knowledge on jewellery products, roamed around the pavilion hoping to realise a bargain. As a result, people often overlooked those stands that presented high quality products in favour of bazar-like areas, where it was possible find products ranging from costume jewellery to low-quality gems.
But there were also other categories of buyers who did go to the exhibition with an idea on what to look for and what budget to spend. It is their behaviour that jewellery firms are monitoring with special attention.
A lady showed us a ring she had bought after intense scrutiny, an undoubtedly well-crafted aquamarine ring contoured by small diamonds, and told us that compared to other gemstones this one appeared to her acceptable in price. But it was not only money that convinced her to buy that jewel: she wanted something of a different colour from the pieces she already had, and aquamarine just had the right characteristics.
Analysing customers behaviour merely from price levels could therefore be misleading. Another important factor is the need to differentiate the offer from the usual range of colours. Those requests do not come from the occasional buyer, who might, on the contrary, be attracted by the classic precious gemstones that they perceive as more luxurious; it is high-end consumers who ask for more variety in jewellery, looking for unusual colour and tones. Luxury brands are eager to intercept this trend and presenting new collections that include a large use of semi-precious stones.
No wonder that the organisation of Gemworld put much effort in advertising the Brazilian Minas Gerais stands, which presented a vast range of semi-precious stones. A flawless Brazilian green tourmaline can be bought for a price ranging between US$250 and US $350 per carat. This makes it quite interesting for customers in search of something different from the classic jewellery and at competitive prices.
Jewellers and gemstones dealers have realised that the business of those stones has great potential: associations such as the CIBJO are discouraging the use of the word “semi-precious” to indicate any gemstone besides the great four (diamonds, emeralds, rubies and topazes), while suggesting to foster public awareness on quality differences in cut, colour and crystal regardless the type of mineral.
Great attention to innovation was also given Young Designersʼ Contest, which gathered some of the best promises in jewellery design. One of the main criteria to select the finalists appeared to be the ability from the contenders to use alternative gemstones and materials. The winner of the contest, German designer Mirjam Dreher, presented a jewel composed of synthetic gemstones cut in a simple and essential fashion.
In conclusion, Gemworld Munich seemed to be the mirror of what gemstones and jewellery markets in Europe are today: after a few years of sharp decline there is the potential to recover, but customers are changing their taste and now want innovative products, preferably at a competitive price. This is making the market quite fluid in terms of proposals, with jewellers eager to meet and possibly anticipate the desire of the people.
Matteo Butera, Rough & Polished from Munich
