If sales at the Hong Kong Jewellery & Gem Fair reflect the current state of the global economy, then full recovery is still ahead of us, the U.S. market is still hurting, and in China business is slower yet clearly pulling ahead. Almost all exhibitors at the show reported a decreased level of sales, and expressed a certain amount of discontent with the show.

 

 

In practical terms, this currently means that jewelers with higher than usual stock levels buy less and very cautiously, and diamond buyers demand lower prices so they can maintain lower price points – even if it means to buy lower color/clarity items.

 

The general consensus is that there were fewer visitors this year compared to last year. By Saturday, nearly 36,000 visitors attended the show, according to the fair organizers. Final figures have not been published yet, however last year a total of 37,276 visitors attended the fair.

 

Focused Designs, Yellow Diamonds and Pearls

Jewelry trends reflected the times, with many exhibitors showing lines designed with the tighter purse buyer in mind. This meant that they offered lighter items to cut on the cost of gold, set the jewelry with smaller and lower quality diamonds and made greater use of silver.

 

Jewelry and diamond manufacturer BTC decided to decrease its margins as well as set their jewelry with lower color diamonds. They maintained, however to gold content. According to sales executive Gary Ng, they did so to meet consumers desire "to feel the gold."

 

Dalumi Jewellery took a different approach. According to Elle Hill, head of global business development, they narrowed their collections, deciding to focus on proven lines. This allowed them to minimize the risk of producing less popular items.

 

Two trends that caught our eye were the increased use of pearls and yellow diamonds. The price of pearls fell in the past year and jewelry designers took advantage of that. As a result, pearl jewelry were seen in the display cases of most companies, regardless if they offered lower price point goods, mid-level items or high end objets d'art.

 

It is not clear if those items sold well, considering the higher price of yellow diamonds. One exhibitor said he has such an item in the display case, but his buyers were mostly interested in the smaller, basic pieces. He argued that most exhibitors had them for show only.

 

While the shift was clearly toward belt tightening measures, a number of exhibitors reported good sales of higher end items that were priced well, proving that in diamonds as in diamonds, the allure is always there.

 

Flower designs are still prominent and spherical designs, including three dimensional forms, were seen in every display case.

 

Diamond Sales

Diamond buyers were often looking for G-I/VS goods, typical items for the Chinese market. Larger diamonds in higher SI1-VS2 clarities as well as fancy color goods were also sought after, however traders did not report large business volumes. The point of contention was price. Two large wholesalers with very busy booths said asking prices were too high for today's market and must be lowered to meet what buyers are willing to pay – which both claimed to do. Considering that diamond wholesaling is a game of volume, they clearly did well.

 

New Venue

At the remote AsiaWorld-Expo (AWE) by the Hong Kong airport – where diamonds, pearls and gemstones dealers were located – everyone debated if the separation from the jewelers and the main venue at the convention center was a good idea. Most argued against it, citing its inconvenience. A number of diamond traders said they used to do good business with exhibiting jewelers that stopped by their booths during the day when they had a short break. They now lost a majority of that business. Others argued that the separation as well as the distant location – a 30 minute train ride - is good. Visitors, they said, were serious buyers that came to do business.

 

And what is the Hong Kong Show without Thefts

Almost a custom by now, this year's show had its fair share of thefts. There were at least four reported cases of thefts on the first day of the show. In one case a 5 carat diamond was switched with a fake. In another, a Mainland China resident was caught trying to steal a diamond and was released. It was later discovered that he was caught during his second attempt after succeeding in taking a diamond just moments before. Some $5,000 in pearls were stolen too.

 

In what was probably the worst case, a Taiwanese exhibitor reported that a case containing $1.5 million in diamonds "went missing" from the Airport Express.