Diamond Demand Grows in China
Diamonds to sparkle in China
Diamonds are expected to sparkle brighter in China on a surge in domestic consumption and investment.
Antwerp, the World’s biggest hub for diamond trading, will see China overtake the United States to become the Belgian city’s biggest destination for Diamonds exports by Y 2016, according to Ari Epstein, chief executive officer of the Antwerp World Diamond Center, which officially represents the city’s Diamond industry.
China imported a total of 9.28-M carats of both polished and uncut Diamonds, with a total value of US$5.09-B, from the Belgian city in Y 2011.
The Diamond center’s transaction volume, which includes exports and imports, reached US$60-B in Y 2011, with 4 out of every 5 uncut Diamonds coming from Antwerp.
The noticeable growth in demand coupled with rising interest in the gemstone as an investment product for Chinese consumers will drive the rise in Diamond imports in the country, Mr. Epstein said Friday.
He added that the upward trend will continue and will lead China to become the biggest destination for Diamond exports by the end of Y 2016, without citing figures.
China briefly overtook the US to become the World’s biggest diamond consumer in Y 2008, when the US was caught up in the Global financial meltdown, but dropped back to 2nd position when the crisis waned.
In Y 2011, the US was the biggest consumer of polished Piamonds, accounting for 36% of total World demand, followed by China with a market share of 12% and India with 11%.
Mr. Epstein said that the rise in China’s domestic demand has also triggered a rush to Antwerp by Chinese companies to trade in the gemstones. The rise of the middle class in China against the backdrop of an expanding economy has resulted in a buying spree for everything from gemstones to Gold bullion to other luxury goods.
A report from the World Gold Council, published Thursday, also projected that China will overtake India to become the World’s top consumer of the precious Yellow metal this year because of rising demand for Gold as jewelry and as an investment.
With regard to luxury goods, China is well positioned as the World’s 3rd biggest consumer with total consumption worth more than 150-B Yuan (US$$24-B) in Y 2010. The country is expected to overtake Japan to become the global number 2 within 2 yrs.
China is a demand-driven market, and with rising levels of prosperity and consumer spending, the Country’s imports of gemstones can only grow, Mr. Epstein said.
The Antwerp center plans to set up a “polished desk”, either in Shanghai, or 1 of China’s other heavily industrialized cities, to sell Diamonds to jewelry companies.
The plan came after last October’s co-operation agreement on Diamond financing between the Center and the Industrial and Commercial Bank of China Ltd, the Country’s biggest lender.
The Diamond boom has also prompted the Chinese bank to decide to open up a branch in Antwerp. That may happen within the next 6 months.
Mr. Epstein said that China will become a more important manufacturing center for Diamond cutting and polishing, regardless of the rising labor costs.
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster’s Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.
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