Buyers were asking for lower prices in IIJS
By Avi Krawitz, Dilipp S Nag www.diamonds.net
RAPAPORT... Visitor traffic remained light for most of the Signature IIJS show but exhibitors appeared satisfied that the right type of buyers were in attendance.
“Overall it’s been a good show but turnaround has been a bit less,” said Devang Doshi, of Bhansali & Co., a specialist manufacturer in 0.01 carat to 2.00 carats stones. “Footfall has been low but we have got the right visitors.” Some vendors noted that the high visitor entrance fee prevented stronger crowds from attending.
Sanjay Kothari, vice chairman of show organizers the Gem & Jewellery Export promotion Council (GJEPC), acknowledged that the intention is to keep the show an exclusive buyer event.
Most exhibitors who spoke with Rapaport News reported that they were receiving a steady stream of inquiries but buyers were asking for lower prices, while some traders were adjusting accordingly.
“People are uncertain and they fear that prices may still come down,” said Swaroop Biswas, marketing manager at Kiran Gems Private Ltd. He explained that market conditions are particularly tough for smaller polished suppliers who rely on the domestic market, while larger more diversified exporters are faring better.
Vendors noted that activity in the jewelry section was better than for loose diamonds.
One international trader, who requested anonymity, said that he had sold goods for 2 percent to 3 percent cheaper than before the show.
Sujay Valanju, marketing and corporate communications manager at Dimexon Diamonds Ltd., added that buyers were showing resistance on stones larger than 1.00 carat and less so on the smaller goods. “Not everyone is in a buying mood but there is movement,” he said. “But they are treading cautiously.”
Indian polished manufacturers and dealers expect sales to improve in the first quarter following the local wedding season and as trading with international centers returns to normal after the New Year vacation period. Exporters are hoping that U.S. retailers will replenish depleted inventories after reports that holiday jewelry sales were better than expected. They eagerly await official sales numbers to be published in the U.S. later during the month to confirm the market reports.
Most exporters noted that sales were good this past November - December period, which helped stabilize the market and inject money into the market. “Liquidity has improved since September due to the increased turnover at the end of the year,” Doshi said.
Kothari agreed but explained that volatile gold and diamond prices in the second half of 2011 has influenced people to cut down on their buying. More recently he explained that the weak rupee has also caused a fluctuation in diamond prices in the domestic market. “That’s why people have been reluctant to purchase [goods] because they are not sure how the exchange rate will move in the short term so they prefer to wait,” Kothari said. As the exchange rate stabilizes, he expects buying to improve.
Since the beginning of August, the rupee has lost about 19 percent in value to trade currently at INR 52.725 to $1.
“Everyone is facing a price barrier and the exchange rate volatility is a concern,” said one trader. As a result, trading at the show remained relatively low given that the Signature show is largely aimed at domestic buyers.
“People do not feel free to buy goods immediately,” Isaac Siman-Tov, managing director of Lili Diamonds, an Israeli company participating in the show for the first time. “But we feel a strong connection here and there is good potential so we are looking at the long term. We have got customers inquiring about goods but we need to be patient.”
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