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Diamond Prices Firm After Supply Declines

1 ct. RAPI +5.8% in 2020

Jan 5, 2021 5:00 AM   By Rapaport
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RAPAPORT PRESS RELEASE, January 5, 2021, Las Vegas… Diamond trading was seasonally slow in December as the industry’s focus shifted to retail and as diamantaires took their end-of-year break. Sentiment received a boost from strong holiday e-commerce sales, the distribution of Covid-19 vaccines, and the US approval of a $900 billion coronavirus stimulus package.

Polished prices firmed as supply declined due to limitations on diamond manufacturing during India’s lockdowns. The RapNet Diamond Index (RAPI™) for 1-carat diamonds rose 2.3% in December and 5.8% for the full year.

RapNet Diamond Index (RAPI™)
December 4Q 2020 FY 2020
RAPI 0.30 ct. 0.4% -4.7% 0.2%
RAPI 0.50 ct. 0.8% -2.3% 12.1%
RAPI 1 ct. 2.3% 3.8% 5.8%
RAPI 3 ct. 2.5% 7.0% 3.7%
© Copyright 2021, Rapaport USA Inc.

The industry began 2021 with a healthier supply-demand balance than it had at any stage in the past five years.

The volume of 1-carat diamonds on RapNet in the D-H, IF-VS range — the categories the RAPI measures — declined 24% in the second half of 2020. The top 10% of diamonds in that category were selling at an average of 32% below the Rapaport Price List on January 1, 2021, compared to 37% below on July 1, 2020. The lower discount suggests that demand is stronger relative to the available supply.

Manufacturers are raising polished production in anticipation of steady first-quarter orders as jewelers and dealers seek to replace inventory they’ve sold during the holiday period.

Jewelers with solid e-commerce programs had a good season. Many off-mall independents also did well, as consumers felt safer visiting stand-alone stores than crowded malls and were driven to support local community businesses following the Covid-19 lockdowns. Independents without an effective online presence struggled.

US jewelry sales for October 11 to December 24 fell 4.3% year on year, according to Mastercard SpendingPulse. Online jewelry sales grew 45%.

There is some optimism for the year ahead even as Covid-19 continues to disrupt business activity. To ensure growth, the trade must intensify its efforts to engage with consumers via storytelling and improved omni-channel platforms while keeping supply in sync with prevailing levels of demand.

For in-depth diamond price, supply and demand data and analysis, subscribe to the Rapaport Research Report here.

Rapaport Media Contacts: media@diamonds.net
US: Sherri Hendricks +1-702-893-9400
International: Alex Shine +1-718-878-5138
Mumbai: Prashant Bhojani +91-97694-66855

About the Rapaport Research Report: The Rapaport Research Report provides subscribers with in-depth analysis of key themes affecting the diamond market. It also presents exclusive analytics for diamond prices in a variety of categories, based on sales and inventory data from RapNet®.

About the Rapaport RapNet Diamond Index (RAPI™): The RAPI is the average asking price in hundred $/ct. of the 10% best-priced diamonds, for each of the top 25 quality round diamonds (D-H, IF-VS2, GIA-graded, RapSpec-A3 and better) offered for sale on RapNet® (www.rapnet.com). Additional information is available at www.diamonds.net.

About the Rapaport Group: The Rapaport Group is an international network of companies providing added-value services that support the development of ethical, transparent, competitive and efficient diamond and jewelry markets. Established in 1976, the group has more than 20,000 clients in over 121 countries. Group activities include Rapaport Information Services, providing the Rapaport benchmark Price List for diamonds, as well as research, analysis and news; RapNet, the world’s largest diamond trading network; Rapaport Laboratory Services, providing Rapaport gemological services in India, Israel and New York; and Rapaport Trading and Auction Services, the world’s largest recycler of diamonds, selling over 400,000 carats of diamonds a year. Additional information is available at www.diamonds.net

Image: Polished diamonds. (Shutterstock)
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Tags: Coronavirus, COVID-19, diamond, diamonds, jewellery, Jewelry, MasterCard SpendingPulse, Rapaport, RAPI
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