Coronavirus bugs diamond traders

India is the world’s largest centre for cutting and polishing of rough diamonds, and it is said that 14 out of every 15 rough diamonds produced are polished here.

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Overall export of cut and polished diamonds in the first nine months of the current fiscal was down 17.14 per cent from the same period last year.
Kolkata: Prices of rough diamonds have risen by 3-4 per cent in De Beers’ first sale of the year, though Indian diamond exporters are not sure whether the price increase will be reflected in polished diamonds, as demand from China, Hong Kong and the Far East is likely to take a hit due to the outbreak of coronavirus.

After a difficult 2019, diamond mining major De Beers has reported sale of $545 million worth of rough diamonds in the first sales cycle of this year. The improvement in sales is an indication that the industry is on a recovery path.

Vipul Shah, a leading diamond exporter and a De Beers sightholder (authorised bulk purchaser) said the inventory levels with the manufacturers have come down after Diwali. “We were expecting that prices will remain firm at the first sales. Rough diamond prices across all categories are up by 3-4 per cent,” he said.


India is the world’s largest centre for cutting and polishing of rough diamonds, and it is said that 14 out of every 15 rough diamonds produced are polished here. Surat is the hub for cutting, polishing and processing rough diamonds and 85 per cent of the stones are exported.
diamond-graph

“What is bothering the trade is the outbreak of coronavirus in China. It will affect sales of cut and polished diamonds if the situation does not come under control shortly,” said Shah. “In that scenario, polished prices will not go up and the margins of the manufacturers will come under pressure.”

Overall export of cut and polished diamonds in the first nine months of the current fiscal was down 17.14 per cent from the same period last year.
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The industry was expecting an improvement in exports in the fourth quarter following the US-China trade treaty. But as things stand today, exports are unlikely to go up in the fourth quarter.

The death toll from the coronavirus outbreak crossed 360 on Monday, with dozens of people dying in the epicentre's quarantined ground-zero. The virus has since spread to more than 24 countries. The World Health Organisation has declared the crisis a global health emergency.

“Exporters are worried that if the situation does not come under control in the coming weeks, then the Hong Kong International Jewellery Show, which will be held March 4–8, will take a huge beating,” said Sabyasachi Ray, executive director of Gem & Jewellery Export Promotion Council.
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