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Rapaport Weekly Market Comment
Aug 11, 2016 11:00 AM
By Rapaport News
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India IIJS show better than expected
for gold jewelry but weak for diamonds. Manufacturing profit under pressure
with relatively high rough prices and sluggish polished demand. Rising
expectations for Hong Kong show. U.S. supporting the market but large retailers
dominating demand and squeezing suppliers. U.S. independent jewelers exiting
with 460 business closures (+88%) in 2Q. Blue Nile 2Q sales flat at $114M,
profit -9% to $2M. Lucara 2Q revenue +169% to $141M, profit +436% to $46M after
selling 813 ct. rough for $63M ($77K/ct.). Sarine 2Q revenue +45% to $21M,
profit +122% to $6M. U.S. June polished imports flat at $1.7B. Hong Kong 1H
polished imports -9% to $8.5B.
Fancies: Markets slow with some weakening of
prices. Ovals and Pears doing well. Cushions supported by specific orders.
Emeralds selling with improving large-stone demand. Princess and Hearts slow.
Top quality fine-cut fancy shapes OK but buyers are extremely picky. Overall
fancy shape prices relatively soft. U.S. demand supporting market for
commercial-quality fancies, especially for sizes under 1 ct. Far East fancy
demand weak. Buyers are very selective and insisting on excellent-shape
proportions. Significant price differentials between excellent- and average-cut
fancies. Off-make, poorly-cut fancies illiquid and very hard to sell, even at
very deep discounts.
United
States: Polished
trading quiet. Jewelers insisting on memo rather than buying for inventory.
Larger jewelry retail chains looking for goods but pushing for higher
discounts.
Dealers
focused on RapSpec A2+ (3X, None) as premiums over non-A2 decline. Steady
demand for 0.70 to 1.25 ct., G-J, VS-SI goods. 0.30 to 0.40 ct. slightly slower.
Belgium: Antwerp diamond bourses closed until
August 22 for summer vacation. Some Antwerp-based Indian dealers in Mumbai
looking for goods but demand expected to remain quiet until September Hong Kong
show.
Israel:
Polished trading very
quiet ahead of summer vacation period. Israel Diamond Exchange to close August
15 to 28. Dealers cautious due to slow demand and tightening credit conditions.
Steady demand for 0.30 to 0.89 ct. and 1.01 to 1.99 ct., G-J, SI goods with
some weakness in VS-clarity. 2 to 5 ct. slow. Steady demand for large-size
fancy shapes above 5 ct. with dealers shifting to lower-quality polish,
symmetry and fluorescence. Demand for emeralds improving.
India: Trading at IIJS show focused on gold
rather than diamonds. Gold jewelry demand steady ahead of Diwali season but jewelers
cautious after gold price jumps +26% to INR 31,400/10 gram. Polished market
quiet with steady U.S. demand from major retailers. Manufacturing profits
squeezed as rough remains expensive and polished remains sluggish.
Hong Kong: Slight improvement as dealers return from vacation and prepare for
September Hong Kong show.Chinese demand improving for dossiers with
retailers looking for bargains. Good demand for 1 ct., D-F, VS-SI, 3X diamonds.
Local Hong Kong retailers struggling with slow luxury demand and high
rentals.
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Tags:
Rapaport News
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