March 21, 2009 / 4:51 PM / 10 years ago

Italian jewelers see gloom in 2009 as crisis hits

AREZZO, Italy (Reuters) - Italy’s jewelry sector, the world’s top exporter, will see more gloom this year with falling output and export sales, participants at a trade fair said on Saturday.

Italian jewelry used to dominate the world markets, but its market share has shrunk since early 2000 as lower cost rivals from India, China and Turkey advanced. Economic crisis and high gold prices have dealt it an additional blow.

“After a bad 2008, the situation has not improved in the first quarter, and it will most probably get even worse in the entire 2009,” Antonio Zucchi, chairman of Italian goldsmith’s body Federorafi told Reuters at the jewelry fair in Arezzo, one of Italy’s three main jewelry manufacturing centers.

“The credit crunch hits everyone ... There is no liquidity,” Zucchi said.

Export volumes of Italian gold jewelry fell 13-14 percent in volumes and 8 percent in value to 4.38 billion euros last year, according to estimates from Federorafi and the OroArezzo fair made earlier this week.

Some jewellejewelersrs said they hoped to see the first signs of recovery in the last quarter of 2009, when Christmas sales usually boost trade.

But Giovanni Tricca, chairman of Arezzo’s promotion center which organizes the OroArezzo fair, said business was more likely to pick up next year if the economy started recovering.

Jewelers at the OroArezzo fair, which attracted buyers from more than 50 countries, said their retail and wholesale customers still had full stocks and were not placing new orders.

“They are still in the phase of destocking ... When demand is falling distributors have to reduce stocks. It’s a must for them and it penalizes producers,” said Massimo Citernesi, commercial director at Graziella Group jewelers.


Falling consumer demand has hit all jewelers, from makers of bespoke pieces to manufacturers of mass-market items. Those who bet on innovation in technology and design, and offer high-quality product at affordable prices, are likely to win back clients faster than others, jewelers said.

For instance, jewelers targeting young customers, who would resume spending more quickly than more cautious older clients, would recover from the sales slump faster than others, Federorafi’s Zucchi said.

At Graziella Group, which targets medium and high segments of the market with chunky but light-weight gold “fashion jewelry,” revenues jumped 30 percent and sales volumes soared 25 percent last year, its chairman Gianni Gori said.

Gori said his group posted double-digit sales growth in the first quarter of this year and hoped to maintain this pace in the entire year. Price tags for Graziella’s main collections vary from 200 euros to 5,000 euros, he said.

“We have invested a lot in technology, innovation and creativity,” Gori said.

Reduced exposure to the troubled U.S. market, which accounts for just 5 percent of Graziella’s export-driven revenues, also helped to buck the sector’s negative trend, he added.

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