Diamonds not losing their lustre amid gloom
Diamond prices are holding firm in the face of the economic crisis - but their glitter is not attracting investors.
Neither buyers nor sellers are keen to trade, even though prices are higher than in 2007, before the financial meltdown began.
Auction houses Christie's and Sotheby's say prices for white diamonds have fallen 20 to 25 per cent since early autumn because of the global economic downturn.
Christie's Hong Kong jewellery specialist Mei Giam said a round, 5 carat, flawless clear diamond now cost about US$121,500 per carat, compared with US$146,500 per carat in June. But that was still higher than its June 2007 price of US$73,500 per carat.
Prices of coloured diamonds, top-quality jadeite and other gems such as sapphires have also been holding steady.
'These top-quality stones are very rare in the market. Therefore, their prices at auction since the market crashed have still met estimates,' said Terry Chu, Sotheby's deputy regional director and deputy head of its jewellery department.
She was speaking ahead of Sotheby's spring jewellery sale at the Convention and Exhibition Centre.
At a Christie's sale in London in December, the historic Wittelsbach diamond, which weighs 35.56 carats and has been worn by three of Europe's royal families, fetched US$24.3 million, a record for a diamond sold at auction.
Ms Chu said most jewellery owners were in no rush to sell. That had led to an extreme scarcity of diamonds for auction.
Buyers would only buy items that were genuinely rare and of high quality, she said. Because of that, some less valuable items had been kept from tomorrow's sale.
Ms Chu said the auction house had cut its estimates for some lots because of the financial crisis but was maintaining those for certain items, such as a 12 carat pink diamond being offered at a firm price of US$180,000 per carat.
Ms Giam said that besides rare gems, high-quality pieces by famous makers could also claim high prices.
Nevertheless, excessive glamour is no longer in fashion. Socialite Mira Yeh Leung Mei-lan said the economic gloom had dampened people's appetite for shopping and even the city's most glamorous crowd was opting for relatively low-key attire when attending society events.
'Unlike the times when the economy was good last year, excessive glamour is not desirable amid the current mood,' Mrs Yeh said.
She said she would buy 60 per cent less jewellery this year.
'For investment purposes I would rather buy gold,' she said.