Edahn Golan's Market Analysis: Sight Okay, Retail Not at All

Market Analysis
16/05/2015 07:54

In his latest blog, Edahn Golan argues that despite the positive news on price reductions at the latest May sight, those reductions are not sufficient, not just because sightholders complain the reductions aren't going far enough. Golan believes a combination of moderate price reduction and supply decrease would work much better not only for manufacturers but also for retailers. He adds that the latest sight results demonstrate that De Beers will not decrease supply if it can help it, and the next Sight is expected to be a big one. "The reduction in supply is (at least partially) in the hands of Sightholders." And Golan points to more issues that lie ahead; US retail sales have declined for the sixth consecutive month, and revised figures over the past seven years indicate the jewelry and especially diamond jewelry segment isn't doing all that well, leading Golan to his conclusion: "To improve rough diamond sales, manufacturers need better sales of polished diamonds and higher prices of polished compared to rough diamonds (and not simply higher polished diamond prices). For this to happen, demand needs to be higher on the consumer level. To spark that kind of renewed interest, more and better marketing is needed."