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Rapaport Weekly Market Comment

June 23, 2016

Jun 23, 2016 11:00 AM   By Rapaport News
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Polished markets cautious. Hong Kong show begins with low expectations for Chinese demand after relatively weak JCK Las Vegas show. Prices stable at De Beers sight with boxes selling at mid-single-digit premiums amid concerns that rough market fails to reflect sluggish polished demand. Manufacturing steady. Swiss May watch exports -10% to $1.6B. Luk Fook FY revenue -12% to $1.8B, profit -41% to $124M. Shrenuj FY revenue -34% to $266M, loss of $6M vs. profit of $3M in previous year. India May polished exports +13% to $1.9B, rough imports +15% to $1.5B. Rio Tinto merges diamond and copper units to be headed by Arnaud Soirat. 

Ovals doing well. Cushions improving with better demand at JCK show. Emeralds selling. 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 in New York ahead of July vacation period. Post-Las Vegas demand weaker than previous years but U.S. still considered the best market. Steady demand for 1ct., G-J, VS2-SI2, 3X diamonds. Ovals and Pears the strongest fancy shape. Large orders for commercial-quality cushions. Jewelry retail slow but engagement and bridal demand consistent during summer wedding season.

Belgium: Cautious activity in Antwerp.Dealers waiting for this week’s Hong Kong show to gauge Chinese demand. U.S. demand quiet but stable. Buyers filling orders and not building up inventory. Good demand for dossiers and 1 to 2 ct., D-H, VS-SI, 3X diamonds. 3 ct. okay, 4 ct. weak. Rough trading stable during low-key De Beers sight and “Antwerp Rough Diamond Days” event.

Israel: Polished trading quiet and buyers cautious. Large Israeli delegation exhibiting at Hong Kong show. Good U.S. demand for 1 to 2 ct., G-J, SI-I1 goods. 3ct., SI’s steady, better qualities weak. Ovals and Pears best sellers among fancy shapes. Rough market strong relative to polished with steady rough demand on the secondary market during sight week.

Polished trading slow with very few foreign buyers in the market and sluggish local Indian demand. Suppliers and buyers traveling to Hong Kong show uncertain about Chinese demand. Steady demand for dossiers, particularly 0.50 to 0.80 ct., G-J, SI-I2 and for 1 ct., G-J, SI-I2 diamonds. Manufacturing remains steady at estimated 70 percent of full capacity. Rough trading stable during sight week.

Hong Kong:
Market focused on show which starts Thursday (June 23-26).Expectations low as buyers from mainland China remain cautious and Hong Kong retailers endure significant slowdown in customer foot traffic and sales. Chinese buyers selective and price sensitive. Steady demand for 1 ct., G-J, VS-SI, RapSpec A2 diamonds. 0.30 to 0.40 ct. relatively weak.
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