Hong Kong Show Meets Low Expectations

The important Jewellery & Gem World Hong Kong fair saw slow diamond trading as Chinese buyers limited their purchases, exhibitors told Rapaport News.

Activity was in line with participants’ low expectations, reflecting weak mainland demand amid an economic slump.

Suppliers reported minimal sales of polished under 5 carats. Larger, high-value stones saw some movement, as high-end brands and wealthier consumers continued to buy, but these deals were still limited, exhibitors said. Smaller Asian markets such as Singapore and the Philippines offered some sales.

“We came with few expectations,” said Ephraim Zion, founder of Hong Kong-based Dehres, a supplier of high-end diamonds, gemstones and jewelry. “We did a little business, but not much. We thought we were going to see a few Chinese buyers, but unfortunately it didn’t happen. Some people sold some 10-carat flawlesses, but they sold very cheap to some of the big brands. There were a lot of people who sold at a loss.”

The downward trend in polished prices restricted clients’ willingness to buy diamonds as they didn’t wish to see their inventories devalued, exhibitors explained.

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“There were people who went around looking and checking prices, but everyone is cautious about prices going down,” said Brijesh Dholakia, CEO of Hari Krishna Exports. “Hopefully lower production will have a positive effect on prices.”

Debt crises affecting high-profile Chinese real-estate companies Evergrande Group and Country Garden have spooked the economy, preventing a full recovery from last year’s Covid-19 slowdown.

However, the decline in diamond demand goes beyond that, said Chen Shen, president of Shanghai-based gemstone dealership and consultancy firm Skywalk Global, who also observed slow trading at the show.

Increased competition from lab-grown has dented demand for naturals, while sales of gold, pearls and electronics are strong, he noted, citing reports of mass demand for the new Apple iPhone 15.

“I don’t think it has anything to do with the economy,” said Shen, arguing that consumers were shifting to lab-grown diamonds and members of the trade were following suit. “There is the economy side, but there are [also] consumer trends there.”

The loose-stones part of the show ran from September 18 to 22 at AsiaWorld-Expo (AWE), near Hong Kong’s airport. Finished-jewelry exhibitors displayed their merchandise from September 20 to 24 at the Hong Kong Convention and Exhibition Centre (HKCEC) in the Wan Chai district. This was the first time since before the Covid-19 pandemic that the event spanned both venues.

“As the industry undergoes rebuilding, the challenges ahead remain significant, emphasizing the increased importance of JGW [Jewellery & Gem World] like never before,” said Celine Lau, director of jewelry fairs at Informa Markets, which organized the show.

Main image: Visitors at the show. (Informa Markets)