Dip in US demand takes sheen off Surat diamonds

The appetite for polished stones has slackened in the US and other international markets, giving Surat’s diamond industry sleepless nights, DNA India reported.
Market experts say the past four months have seen demand decline by more than 10% as a result of which diamond cutting and polishing centres in Surat are in a bad shape. Diamond units have started resorting to production cuts, leaving those who depend on the industry, especially diamond polishers, anxious about their future.
Rough stones have also become dearer with the rise in prices of the US dollar.
“Demand has dipped over the past four months and the main reason is the downslide in the US economy, followed by recession in Europe. We have already cut down production and are avoiding stocking polished stones,” a top diamond unit holder said, on condition of anonymity.
He added that polished stones cannot be sold in India or Asian countries as these markets were still not prepared for quality stones.
However, the Surat Diamond Association (SDA) feels there is no need to press the panic button. SDA president Dinesh Navadia attributes the slowdown to the vacation season in the US, Europe, China and other countries.
“There is nothing to worry as export of polished stones is always lesser in August,” Navadia added. In fact, the SDA chief sounds optimistic, saying, “The situation will improve post September and units will have to work overtime to complete orders.”
However, the current bleak scenario is worrying diamond polishers. “There is limited work at our unit and this has made me insecure about my job. I have passed through a bad phase in 2008 [referring to the global recession] and don’t want to experience it again. If things don’t improve by Diwali, I will take a decision on moving to another job,” said Velji Rakholia, a diamond polisher.