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Market Comments 3/20/2014

Mar 20, 2014 6:00 PM  
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Polished markets stable with strong demand for GIA dossiers. Dealers shifting to diamond parcels, non-certs. and 0.25ct. sizes due to 0.30ct. shortages caused by GIA delays. Large stone market speculative ahead of Basel shows. Gem Diamonds 2013 revenue +5% to $213M, profit of $38M vs. loss of $77M a year ago. Belgium’s Feb. polished exports +33% to $1.6B, rough imports +18% to $1.4B. India’s Feb. polished exports +16% to $2.2B, rough imports +12% to $1.5B. Panama Gem & Jewelry Center launched. De Beers to select 5 new sightholders: D. Navinchandra Gems, Diambel, J.B. And Brothers, Star Rays, Vallabhbhai Dhanjibhai & Co. The Diamond Show to open March 27 at Markthalle in Basel.

Fancies: Fancy shape market steady with good U.S. demand for commercial-quality Cushions, Ovals, and Pears. Square-shapes cool with big Asschers and Emeralds strong. Availability of well-shaped fancies tight with shortages of select fine-qualities in large 5ct.+ sizes. Rising investment demand for large expensive stones. Off-make, poorly-cut fancies hard to sell even at very deep discounts. Buyers very selective regarding shape- and cut-quality with extreme price differentials between excellent- and average-cut fancies

Global Comments:

United States: Polished diamond demand is stable but buyers are cautious as they see Far East buyers paying higher prices than they’re willing to in the U.S. Buyers are resisting higher asking prices from sellers which has affected slightly slower local trading. Demand is focused on SI and lower clarity goods. There is overall good demand for GIA dossiers, with continued delays in certifying these goods at GIA. Retail jewelers are pushing ahead with a focus on bridal lines and engagement rings, and are pressured to offer discounts as jewelry prices have softened in the past few months. 

Belgium: Sentiment in Antwerp has improved as polished trading firmed up since the Hong Kong show. There is good Far East demand, while the U.S. is lagging behind in accepting higher polished price levels. European buyers have been boosted by the recent strengthening of the euro against the dollar. There is good demand for 0.20-carat to 0.90-carat diamonds with strong demand for 0.30-carat to 0.50-carat, G-J, VS-SI diamonds. Rough trading is steady.

China: Wholesale diamond trading is stable but not booming as retailers seem to have bought inventory around the March Hong Kong show. There is good demand for below 1-carat GIA dossiers with 0.30-carat to 0.50-carat, G-L, VS-SI diamonds as the strongest category. Retail trading is steady but consumers remain cautious as short-term economic growth is volatile.

Hong Kong: The polished diamond market is stable. Trading is stronger than it was before the March Hong Kong show with steady demand for GIA dossiers, mainly from Chinese buyers. Dealers have gained confidence but buyers are expected to be patient in the coming weeks to assess how prices will trend in the second quarter..

India: Local polished demand is relatively slow as the market has quieted slightly since the Hong Kong show. Still, sentiment is positive after a relatively good first quarter for the trade. Buyers have shifted to 0.20-carat and 0.25-carat goods as prices for 0.30-carat diamonds have increased steadily over the past year and given the reported shortages of 0.30-carat goods in the market. There are a few foreign buyers in the market but trading is slightly cautious. There is good demand for below 1-carat dossier goods. Liquidity is tight, as it usually is ahead of the fiscal year end on March 31, and banks are expected to tighten their lending in the new financial year. Rough trading is relatively slow and manufacturing units continue to operate below capacity. Domestic jewelry retail sales are weak for this time of the year.

Israel: The market is steady with strong inter-dealer trading in the bourse, while orders from overseas are stable but relatively quiet. Dealers are preparing for the U.S. and International Diamond Week taking place in Ramat Gan in early April, hoping for a boost in orders before the Passover holiday break. There is good demand for GIA dossiers and strong demand for SI-clarity diamonds in all categories. Similarly, there is strong demand for large stones above 10 carats. Demand for fancy shaped diamonds is steady with cushions and emerald cuts being the strongest category.

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