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May Certified Polished Prices Hold Steady

Las Vegas Jewelry Shows Signal Stable But Cautious Market

Jun 5, 2012 8:00 PM   By Rapaport
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RAPAPORT... Press Release, June 5, 2012, New York: Certified polished diamond prices were steady during May in a weak global environment. The United States is providing market stability while consumer demand in India and the Far East has softened and uncertainty in Europe continues to reduce confidence. Liquidity is tight and manufacturing profit margins low. Rough prices remain unsustainable and are expected to decline.
 
The Las Vegas jewelry shows were mixed with strong demand from high-end retailers while Middle America continues its shift toward more affordable mid-quality VS-SI goods at attractive price points. Indian buyers were a no-show due to the weak rupee and sluggish domestic demand. Israelis were aggressively looking for polished goods while U.S. retailers were buying to fill orders and not build inventory. Significant improvement in demand for fancy shapes, especially square fancy shapes.

In May, the RapNet Diamond Index (RAPI) for 1 ct. diamonds fell 0.6%. The 0.3 ct. category declined by 0.3% and the 0.5 ct. stones dropped 0.4%. RAPI for 3 ct. diamonds fell 1.6% during the month. Through the first five months of the year, RAPI for 1 ct. diamonds fell 1.7% and has declined by 4.5% from one year ago.   



Polished inventories are stable but trading levels are low with shortages of well-made polished goods, particularly fancy shapes and SI clarity rounds. Indian cutters are slowly returning from summer vacation but manufacturing levels are below capacity. Polished buyers expect prices to soften due to the weak economic environment but suppliers are holding their prices firm due to expensive rough.

Rough prices softening with an estimated 7% decline in BHP Billiton prices. De Beers and ALROSA production remains below capacity and rough supply is limited. Sightholders hoping that De Beers will reduce prices or improve assortments at the next Diamond Trading Company sight, which begins June 11.

While there is a sense of stability in the market, uncertainty prevails.  Buyers remain conservative and inventories across the pipeline are controlled. Trading is set to remain challenging in the second half of the year.

Rapaport will release its May 2012 Research Report on June 11 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 Rapaport - RapNet Diamond Index (RAPI): The RAPI is based on the average asking price in hundred $/ct. for the top 25 quality 1 ct. round diamonds (D-H, IF-VS2, RapSpec-2 and better) with GIA 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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