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April Certified Polished Diamond Prices Stable With Low Trading Volume

May 2, 2012 10:48 AM   By Rapaport
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RAPAPORT... Press Release, May 2, 2012, New York: Certified polished diamond prices were stable in April although trading remained weak. Activity in the diamond trading centers slowed as diamantaires took a break during the Passover and Easter holidays. India is under pressure as the new protectionist 2% polished diamond import tax has drastically reduced 1Q 2012 polished imports by 71% and exports by 42%. Thousands of Indian jewelry shops also went on strike in protest against new excise taxes. While market sentiment improved slightly after the government agreed to review its excise tax policy, the protectionist import tax has destroyed India’s opportunity to become a world class global diamond trading center.

Demand in the consumer markets was stable but wholesalers and retailers continue to maintain low inventory levels. Buyers are focused on commercial-quality diamonds. There is continued improvement in demand for fancy shape diamonds. Price conscious consumers are moving to fancies as their prices are much lower than rounds. Price differentials encouraged cutters to manufacture rounds instead of fancies in 2011, resulting in a current shortage of fancies.

In April, the RapNet Diamond Index (RAPI) for 1.00 ct. polished diamonds fell 0.2%. The 0.3 ct. category increased by 0.4 percent while 0.5 ct. rose 0.5 percent. RAPI for 3.00 ct. diamonds increased 1.2 percent.

During the first four months of the year, RAPI for 1.00 ct. diamonds fell 2.9 percent and was at about the same level as it was one year ago (see table below).



Trading remains well below levels experienced in the first half of 2011. Rough prices have increased by about 7 percent during the first four months of the year and continue to firm. De Beers continues to hold back production exerting pressure on the market. There is improving Indian demand for rough but liquidity remains tight and manufacturing profit margins are low.

Pressure for higher polished prices is coming from high rough prices rather than improving consumer demand. Rough prices are unsustainable at current levels with speculation that U.S. and Far East demand may expand. While the long term prospects for these markets remain strong, current sentiment and trading levels point to a conservative trading environment for the rest of the second quarter.

Rapaport will release its April Research Report on May 7 providing additional information about the state of the global diamond market. The Rapaport Research Reports can be found at www.diamonds.net/report or by emailing: specialreports@diamonds.net

Rapaport Media Contacts: media@diamonds.net
International: Alissa Goren +1-718-473-0882<> U.S.: Sherri Hendricks +1-702-893-9400 <> Mumbai: Mittal Kalsy, +1-91-97699-30069

About the RapNet Diamond Index (RAPI): The RAPI is based on the best asking price in hundred $/ct. for the top 25 quality 1 ct. round diamonds (D-H, IF-VS2, RapSpec-2 and better) with GIA, HRD or AGS grading reports offered for sale on RapNet – Rapaport Diamond Trading Network. The RAPI is provided for various sizes. www.RAPNET.com has daily listings of over 850,000 diamonds valued over US$5 billion and 7100 members in over 78 countries.

About the Rapaport Group: The Rapaport Group is an international network of companies providing added value services that support the development of free, fair and competitive global diamond markets. Established in 1978, the Rapaport Diamond Report is the primary source of diamond prices and market information. Group activities include publishing, research and marketing services, internet information and diamond trading networks, global rough and polished diamond tenders, diamond certification, quality- control, compliance, shipping, and financial services. Major activities of the group include the development of markets for Fair Trade Diamonds and Jewelry as well as the creation of diamond futures markets. Additional information is available at www.Rapaport.com.
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Tags: , diamonds, Polished Diamonds, Rapaport, RAPI, RapNet, RapNet Diamond Index
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