Sight Letter
27th August 2010
Dear Friends
The August Sight is estimated in the region of $535m. Mahiar and the Sales team went to some lengths to emphasise the efforts DTC has gone too in order to present a Sight that was relatively “stable” both in price, and presentation, and in line with the DTC’s commitment to offer consistent Sights. Sightholders nevertheless found some presentations to differ in composition and size, although in general these boxes were in the minority. Although there was no notification of any price changes, some Sightholders felt that in certain areas, mainly in the lower qualities and Preparers boxes price adjustments had been made in order to reflect polished price movements.
The well timed allocation of a broad range of Ex Plan goods was welcomed as it will be in production before the Diwali holidays and will meet the deadlines for Christmas season orders. A few areas remain in short supply due to mining constraints and ITO commitments could not be fulfilled. It was again mentioned that greater co-ordination at a mining level would help to maximise the DTC’s selling opportunity and capture the seasonal peaks in the manufacturing cycle.
The recent IIJS Show in India was reported to have been a huge success again, catering to the domestic Indian market and also attracting even greater numbers of exhibitors and buyers from around the world.
The rough market in Antwerp has opened after the holiday period with demand for DTC goods slightly stronger than last month. Premiums are up in many areas by between 1-3% when compared to the July Sight, although it is not entirely clear if business has been concluded across the full range of boxes.
After a very strong first half for polished, manufacturers are now expecting a levelling out of polished prices in the lead up to the American season. Retailers have restocked to a comfortable level and are now adopting a more cautious approach to the forthcoming season. As this important time of the year gets ever closer the feeling is that the season is likely to generate a flat result or very slight increase on the corresponding period in 2009. Indian and Asian markets continue to perform strongly although prices in the “dossier” categories have softened.
The first announcements regarding “enhancements” to the distribution model in the 2012-2015 contract period were unveiled to Sightholders in a series of daily presentations given by Varda. This precedes a period of consultation between the DTC, Sightholders and Brokers which will shed greater light on any forthcoming changes to the new contract.
On Tuesday 24th August the DTC hosted the Business Excellence Seminar and the Mandarin Oriental Hotel in London. Topics covered included; the use of Social networks as engines for recovery, what can be learnt from the recent economic downturn, how science can help us understand the consumer decision making process, and the impact of Corporate Social responsibility on consumer confidence. Sightholders in general felt that the Seminar was extremely well organised and the subject matter was both interesting and relevant to their business, something that has not always been the case in previous years.
With warm regards
Mike Aggett
Managing Director