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Market Comments 12/13/2012

Dec 13, 2012 6:00 PM  
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Polished markets stable with very good U.S. demand for SI qualities. Jewelers discounting heavily to drive final Christmas sales. Expensive De Beers sight estimated at $490M. Weak rough trading and low premiums as Indian cutters hold enough inventory for post-Diwali manufacturing. Christie’s NY sale at $32.5M (84% by lot) with rectangular-cut, 50.01ct, D, potential FL diamond selling for $8.4M ($167,400/ct.). U.S. Oct. polished imports -21% to $1.4B. Belgium’s Nov. polished exports -8% to $1.2B. Philippe Mellier, Varda Shine to address DMIA NY meeting. Caution: Prices for green, grey and brown tinted diamonds 10-15% below non-tinted. Green tint often indicates Marange origin.

Fancies: Fancy market relatively steady with good U.S. demand. Smaller sizes selling well with very strong demand for 3/4's. Lower fancy shape price points attracting price sensitive buyers. Princess demand strong. Relatively weak ‎‎demand and lower prices for rounds are encouraging manufacturers to shift production ‎‎back to fancy shapes. Extreme price differentials ‎between ‎‎excellent/fine and average cut fancy shapes. Caution: Prices for green, grey and brown tinted diamonds 10-15% below non-tinted. Green tint often indicates Marange origin.

Global Markets

United States: Wholesale trading is steady as dealers work to fill last minute demand ‎before Christmas. While retail jewelry sales tapered off since Thanksgiving weekend, ‎along with most retail categories, sales are expected to rebound in the coming final two ‎weeks of the year, especially in the higher priced items. Among diamond dealers, there is ‎good demand for smaller fancy shapes with princess, pears and cushions selling ‎particularly well. In rounds, demand is focused on SI- goods, with nice-make GIA ‎certified diamonds in competitive supply. ‎

Belgium: While inter-dealer rough and polished trading has softened slightly, polished ‎demand remains stable from U.S. and Far East wholesale and retail customers. Prices ‎are holding steady for goods required to fill specific orders but offers to buy inventory are ‎still too low for suppliers to take seriously. There is good demand for G-I, VS-SI goods ‎with improved demand for collection VS goods. Demand for collection VVS stones ‎remains weak. ‎

Israel: The market is stable with good demand from U.S. customers. Suppliers are ‎pushing for final Christmas orders and note steady demand for 1-carat, 1.5-carat and ‎oversize, SI- goods, particularly from the U.S., as well as nice, non-certified pique goods.  ‎Rough dealers are waiting to see De Beers boxes from this week’s sight but initial ‎demand for them on the secondary market is weak as De Beers is considered expensive ‎relative to other sources.  ‎

India: Polished trading eased slightly as demand softened from foreign and local buyers. ‎Overseas buyers focused on filling their final holiday requirements, while domestic ‎buyers worked to satisfy demand for the ongoing wedding season. There is good ‎demand for SI- stones and some shortages in nice-make, SI-, GIA certified goods. ‎Rough trading is relatively stable but dealers remain hesitant regarding De Beers goods ‎during this week’s sight. There is sufficient rough supply as manufacturing continues at ‎reduced capacity with some workers still away due to the wedding season. The ‎exchange rate remained relatively stable this week.‎

China: There has been little change in market conditions during the past week with ‎buyers focused on filling orders and still cautious to make inventory purchases. Most are ‎waiting for January to assess whether recent polished price stability will hold and ‎influence some buyer confidence ahead of the Chinese New Year season.  This week’s ‎China International Jewellery Fair in Beijing has spurred some interest among diamond ‎buyers but is not expected to significantly boost trading. ‎

Hong Kong:
Wholesale demand remains slightly weak as buyers are hesitant about ‎global economic trends and political changes taking effect in China. Dealers expect ‎overall caution to continue through the first quarter of 2013. Still, suppliers are holding ‎polished prices steady and there is good demand for fancy shape, D-G, VS-SI diamonds. ‎Retailers note steady tourist traffic in the city but consumers have lowered their per-ticket ‎spending.  ‎
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