Greetings from KIRAN Family..
Wishing all our esteemed customers, team members and their family best of health and hope you are back with the new normal!
Just a round-up from our previous newsletter – wherein we had informed about the restricted manufacturing activity in India along with the much needed flexibility created on rough buying and an overall limited polish inventories. This led to the prices in polished goods being mostly stable to marginally higher. The equilibrium created in demand and supply by combined efforts and swift action of diamond manufacturers in the last 6 months has had a singular effect in keeping the overall market buoyant as the production was kept low to adapt towards the COVID situation. All these efforts have indeed held the sector in good stead as Diamond industry is one of the select few witnessing a quick rebound.
Demand is also buffeted by the fact that while the global economies have gradually come out of the lockdown and consumer spending is getting back to normal levels, the still restricted travelling and overall limited spending options has also aided in demand normalization and increased wallet share for the diamond sector given that it caters to a sentimental need of a personal nature. Current Rough situation: It is expected that the Miners who have handled the COVID crisis diligently and effectively shall continue with the vigilant approach as it has had a strong impact in keeping the entire value chain supported. It is noteworthy to realize that if a similar approach is continued, we envisage 2021 to be a golden year for the diamond industry. Rough prices in the primary market are stable and the industry pipeline is healthier than ever, however prices in the secondary market are showing strength due to increased demand from the smaller to medium scale factories. We anticipate stable to slightly higher rough prices in certain articles in coming days. Current Polish situation: Business avenues shall continue opening up going ahead as has been the case post August 2020 – as more and more markets are completely coming out of the lockdown and consumer behavioural normalcy is picking up at a very fast clip given the unprecedented large monetary support already provided in the US, China and other developed markets which make up for close to 80-90% of global sales. Polish demands are in fact growing by the day in the US, China and South Asian countries like Thailand, Vietnam etc. Diamond production is still lower overall due to social distancing norms being followed and still prevailing non-availability of skilled workmen vis a vis pre-COVID levels. Certain articles in Polish are at a premium now due to increased demand and the festive season lined up.
Going forward: We are cautiously optimistic both in terms of overall demand and its concentration as we witness a clear shift – of higher demand emanating from the Jewellery Manufacturers and Retailers
towards more organized and service-oriented suppliers. In this era of the new normal wherein new ways of doing business are being rapidly adapted, Companies following “Make to Measure” and focusing on creating more efficient ways of doing business shall be better equipped in servicing the expanding needs of the clients.
Companies providing dependable capabilities to implement key strategies like proper forecasting, inventory control will benefit in the long run. Post COVID, it will be imperative to choose a supply partner with a consistently strong manufacturing background which can cushion the short to mid-term volatility in prices and can adapt to new challenges. Trust, reliability, consistent assortment, and unhindered supply will play a pivotal role in choosing an ideal supply partner.
Fancy shapes will turn out to be a growth avenue and a game-changer due to its growing acceptance and the cost benefit compared to rounds. Also, in the era of Social Media (Instagram, Pinterest etc.) driven Consumer behaviour – differentiation offered by the fancy shapes due to their distinctive look has led to growing demand from retail end jewellery buyers. We are seeing an ever-growing number of jewellery manufacturers inclined to change their designs and procure Pears, Marquise, Emeralds and Ovals along with their regular inventory.