Monday, August 30, 2010
To Counter Increase In Rough Diamond Prices
SURAT: As the gem dealers in Antwerp and Dubai have increased the rough diamond prices by about three per cent, anticipating robust demand from key consuming centre in Surat ahead of Christmas season, diamantaires have started building pressure on the promoters of new diamond syndicate to speed up the legalities of forming Surat Diamond Sourcing India Limited (SDSIL) and start its operations.
Industry experts said the prices of rough diamonds have climbed this year after producers, including De Beers, cut output and gem dealers rebuilt stockpiles. The rough prices rebounded by almost 15 to 20 per cent from its pre-recession level following the increase in jewellery sales across the globe, including the United States, China, Hong Kong, South America, United Aran Emirates and Commonwealth of Independent States (CIS) countries.
Data collected by Gems and Jewellery Export Promotion Council (GJEPC) show that India's diamond trade during the first six months of 2010 has already surpassed 2008 levels for the same period. Rough imports for six months are up 10 per cent from the 2008 to $ 6 billion during January to June 2010.
"Recession has taught diamantaires that over production ultimately hurts their business and therefore, they no longer are holding large volumes of rough stock in inventory. However, they (diamantaires) have to depend on the gem dealers in Antwerp and Dubai for their rough supplies. But, the situation is such that the prices of rough are on fire due to the improved demand of jewellery in some of the key consuming centres of the world," president of Surat Diamond Association ( SDA) Dinesh Navadia said.
Praveen Shah of Ankit Gems said, "The company is going to directly source rough diamonds for the industry people at competitive rates. We want the company to start operations soon. This will help us in minimising our costs of procuring rough diamonds from the secondary market at higher rates."
Recently, Russia's government has announced to sell the diamonds it bought last year for $1 billion from ZAO Alrosa. However, the SDSIL promoters have been closely eyeing the developments in rough mining countries to tap the vast resources available.The spokesperson of SDSIL said the legal process of forming the company has been started and it may take a month to complete the formalities. "The response is tremendous and we have collected a huge amount running into crores of rupees in the last 10 days. They (industry stakeholders) will have to wait for a month to see the company start its full-fledged operations."
Hitesh Shah of Mahima Gems said, "Only SDSIL can promise the industry consistent supply of rough diamonds at competitive rates. However, we have been eagerly waiting for the company to start operations at the earliest."
Melvyn Thomas, TNN