IDI sees slowing demand for rough diamonds in Q4

0
16

IDI sees slowing demand for rough diamonds in Q4

IDI sees slowing demand for rough diamonds in Q4


Moti Ganz, Chairman of the Israel Diamond Institute (IDI)

Ramat-Gan, Israel, October 27, 2011 – “In the last quarter of 2011, the global demand for rough diamonds will run at about $1.2 billion less than the $4.6 billion sold in each of the first three quarters,” said Moti Ganz, Chairman of the Israel Diamond Institute (IDI), President of the International Diamond Manufacturers Association and the Israel Diamond Manufacturers Association.
“The reduced demand for cheaper and small diamonds in the U.S. market is partly offset by a strong demand from the Indian and Chinese domestic markets – but the consumers in these new emerging markets demand bigger and higher quality goods.”
Nevertheless, said Ganz, the industry’s recovery is continuing.
“Even with the current ‘technical correction’ in the rough supply make-up, the manufacturers will process some $16.9 billion rough this year, a 27 percent growth over the $13.3 billion of 2010,” he said.
“Expressed in polished wholesale prices, the diamonds available to the jewelry sector will grow by some 5.3 percent from $18.9 billion to $21.9 billion this year,” he added, citing PharosBeam and Tacy research.
“The changing consumption patterns require a shifting of manufacturing focus in the cutting centers, which partly explains the unease in the rough markets in which certain (cheap) goods cannot find buyers even at two-digit marker discounts, while goods which are in demand are hard to find,” Ganz said.
He lauded the decision by the DTC, the marketing arm of De Beers, to limit the next sight allocation to $300 million, following the previous sight of $440 million.
”These reduced allocations will further help to calm the market, which has recently seen vacillating prices in light of changing consumption patterns,” he said.
Ganz said the DTC, headed by Varda Shine, took into consideration the slowdown in the world markets due to the Divali holiday celebrations in India that have started this week when factories close down and workers join their families.
As the industry is currently facing liquidity challenges, the DTC is assisting clients who can postpone their purchases to when they need the goods for manufacturing and have the financing in place to pay for their sight boxes.
“These supply restraints will undoubtedly improve the atmosphere in the entire diamond supply pipeline, creating also much needed upward pressures on polished diamond prices,” Ganz said.

LEAVE A REPLY

Please enter your comment!
Please enter your name here