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WFDB Sees Positive Industry Outlook Heading into Holiday Season
Sep 24, 2015 5:22 AM
By Rapaport News
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RAPAPORT... The outlook for the global diamond trade could be positive in the upcoming holiday season given the early indications that the Hong Kong Gems and Jewellery Fair has been solid and as the world’s two main producers cut prices.
Last week, ALROSA said it would reduce prices by up to 10 percent at its September sale, according to a press statement issued by the World Federation of Diamond Bourses (WFDB). That followed De Beers' decision to slash prices by similar levels at its August sight.
Such steps are bringing down prices to more realistic levels, the statement released from Antwerp said on September 22. In addition, the much-needed cuts in polished production have been carried out, particularly by the Indian manufacturing sector.
“I feel there is reason to be optimistic, even though conditions do, of course, remain challenging overall,” Ernie Blom, president of the WFDB, which has 30 affiliated bourse members, said. “The Hong Kong show, due to the global nature of its exhibitors, buyers and visitors, serves as a useful barometer of industry sentiment, so it is very promising that demand at the fair was stable.”
Blom pointed out producers have accepted the argument that diamond manufacturers cannot be expected to pay higher prices for rough at a time when polished prices are falling. “We need to see a further reduction in rough prices, but these moves by De Beers and ALROSA are encouraging, and we expect to see the trend repeated at other diamond sales and tenders.”
Many diamantaires’ decisions to hold off on manufacturing will also help put a floor under prices, according to WFDB. “Now that some major players have cut production, there will be lower levels of polished inventories and possibly shortages in some items. I believe this will lead to a rise in business transactions.”
Blom also said the work of the World Diamond Mark (WDM) was continuing to bear fruit. “The WDM continues to create alliances with leading companies to help build generic marketing of diamonds. We all know that the situation remains far from easy, but these developments should certainly give us all reason to be more optimistic in the coming months.”
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Tags:
Ernie Blom, Rapaport News, WFDB
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