Indian Diamond Industry Has A Good Holiday Sales Season

(IDEX Online News) - Holiday demand, particularly from the U.S., was surprisingly good for the Indian diamond industry. Diamond dealers said they were pleasantly surprised by the level of demand despite the adverse weather conditions in the U.S. which would normally have dampened sales. This demand, combined with the continuing shortage of polished goods in the market, has kept prices buoyant.

The shortage of polished is a factor that worries some, however. One insider noted that rough diamond inventories in India were probably much higher than that of polished diamond.

The lack of skilled labor is still a main cause to the low production and until there is a major restructuring in the wages the industry pays, this labor shortage is going to persist, the source said.

An added factor is that with the rise in prices in the Rapaport list, sellers are more inclined to hold on to their goods as they foresee stronger prices in the near future, given the persisting shortages.

With the holiday season over, however, demand will also slack off and industry watchers say it remains to be seen what the composite effect of all these factors is on polished prices in the weeks ahead.