FOCUS 焦点 JNA November/December 2023 | 11 not reach the level that we anticipated. There were a few unpleasant surprises in 2023 – inflation, higher interest rates and now the war in Israel, to name a few.” Hope for diamonds A “challenging” 2023 came at the heels of rapid and strong post-pandemic recovery in consumer demand, according to Feriel Zerouki, president of the World Diamond Council (WDC) and senior vice president of Corporate Affairs at De Beers Group. Macroeconomic uncertainties dampened consumer appetite for diamond jewellery, she added. “The pressure was amplified in wholesale markets because of midstream inventory levels and the supply chain ripple effect,” noted Zerouki. Sabyasachi Ray, executive director of India’s Gem & Jewellery Export Promotion Council (GJEPC), agreed, adding that demand from the US weakened due to economic upheavals. Additionally, a post-Covid rebound in Chinese consumption is yet to materialise. “China is grappling with its own economic challenges, affecting jewellery demand. This also led to a 25 per cent decline in India’s gem and jewellery exports to date,” revealed Ray. Echoing Ma’s sentiments, Sidharth Agarwal, director of major diamond dealer Kowloon Trading Co, said further instability can be expected throughout 2023. In fact, demand has dropped so much that it was almost on a par with Covid-19 levels as of October. “September to December is supposed to be a peak buying season in the jewellery trade due to Thanksgiving, Christmas and other festivities, but we are not getting the usual number of orders,” noted Agarwal. “There is little optimism as we navigate the second half of 2023.” Buyers are also playing safe due to price uncertainties, opting to limit their diamond purchases to just meet specific orders. This was a stark difference from the first two quarters of the year when Kowloon Trading Co’s clients would buy in bulk in anticipation of increased orders. Meanwhile, customers could buy on the dip as prices are down, especially for smaller-sized loose diamonds of VVS and VS clarity grades. Even SI goods are also seeing a drop in prices although not as steep as those for better-quality stones, according to Agarwal. “You can say it is a good time to buy, but there is also so much uncertainty in the market. Nobody knows where the bottom line is,” he continued. Hope may be on the horizon though. Both Agarwal and Ma of DFHK are counting on recent industry initiatives to help stabilise the diamond market: India’s voluntary two-month moratorium on rough diamond imports until December 15, 2023; and De Beers’ reported decision to allow its Sightholders to postpone diamond purchases to early next year. “Inventory in the pipeline, especially in the manufacturing and wholesale level, remains quite high. Restricting rough purchases over the next two to three months could lessen inventory buildup in the midstream,” explained Ma. Solid demand for gems Damien Cody, president of the International Colored Gemstone Association (ICA), cited robust market demand for coloured gemstones at international trade shows in 2023. “Gem and jewellery trade fairs recommenced around the globe and were very successful as traders scramble to once again meet customers face to face,” noted Cody. “Meanwhile, higher prices of goods have slowed trading as there is uncertainty as to where prices will eventually settle.” Temur Ansari of Noor Gems said prices of premium gems such as Paraiba tourmalines have risen by as much as 50 per cent to 100 per cent. Supply is also tight as buyers continue to actively seek these top-quality gems, he added. “We offer rare Paraiba tourmalines from Brazil and Mozambique. We also sell Kashmir sapphires and alexandrite, to name a few. All these are enjoying solid market demand,” he shared. The three major shows in Hong Kong were a highlight in Noor Gems’ 2023 as these enabled it to tap international buyers, specifically from the US, Europe and the United Arab Emirates. Ansari however said companies are adopting a wait-and-see position due to continued uncertainties. 5.25% – 5.5% US interest rates at press time – the country’s highest in 22 years. The US Federal Reserve kept the rates steady in September 2023 but indicated one more possible hike before yearend. 截至发稿时的美国利率，为22年来最高 美国联邦储备委员会在2023年9月保持利率稳定，但表示在年底前可能再加息一次 International Colored Gemstone Association President Damien Cody 国际有色宝石协会(ICA)主席Damien Cody
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