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Rapaport Weekly Market Comment

Feb 7, 2019 10:59 AM   By Rapaport News
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Far East trading quiet during Chinese New Year. Market cautious due to weak demand, tight profitability and reduced bank credit. Selective buyers creating shortages of excellent-cut (3X, none) diamonds, but prices of lower-quality goods softening due to excess supply. 1 ct. RAPI -0.4% in Jan. Manufacturers maintaining low production as profit margins are squeezed by high rough prices. Letšeng 4Q sales -40% to $42M, average price -43% to $1,259/ct. Belgium 2018 rough imports flat at $10.7B. Pandora 2018 sales flat at $3.5B, profit -13% to $773M. RapNet introduces jewelry to trading network. The Rapaport Group wishes all our friends a happy and successful Chinese New Year.

Fancies: Fancy-shape market stable, driven by US and European demand for fashion jewelry. Excellent-cut ovals, pears and emeralds doing well. Supply shortage supporting prices for Pears. Radiants improving. Marquises and Princesses weak. Steady demand for fine-quality 6 to 10 ct. Ovals, Pears and Emeralds, with prices firming for 3 to 5 ct. due to shortages. Chinese consumers seeking fancy shapes at better prices. US supporting market for commercial-quality, medium-priced fancies under 1 ct. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: New York trading stable but lacking usual first-quarter buzz. Shortage of better-quality diamonds supporting prices. Large availability of lower qualities such as brown, green, milky (BGM) stones. A lot of goods out on memo. Dealers concerned about lack of industry financing and growing demand for synthetics. Retailers focused on Valentine’s Day promotions. Solitaire jewelry selling well, and rose-gold rings gaining popularity.

Belgium: Dealer sentiment mixed amid sluggish polished trading and concern about high rough prices. Fewer post-Christmas orders than last year. 3X, no-fluorescence stones selling at firm prices. Stable demand in 1 ct., H, VS1, 3X diamonds. Rough trading slow, with some dealers making a loss on the secondary market.

Israel: Positive momentum from International Diamond Week at the end of January. Niche suppliers of large stones, fancy shapes and fancy-color diamonds doing well. Low availability of bread-and-butter, 1 ct., D-J, VS2-I1, RapSpec A2+ goods, with buyers relying on overseas suppliers. Weak demand for 3 to 5 ct., D-H, IF-VVS2 diamonds, with prices softening despite low inventory.

India: Polished trading quiet. Foreign dealers in Mumbai looking for bargains. Relatively low amount of new merchandise available, as manufacturers keep production down due to tight profits and sluggish demand. High gold prices weighing on jewelry retail sales. Jewelry wholesalers and diamond dealers hoping for boost at next week’s IIJS Signature show (Feb. 10 to 13).

Hong Kong: Jewelry wholesalers and diamond dealers on vacation during Chinese New Year. Activity expected to resume in two weeks and pick up around the Hong Kong show (Feb. 28 to Mar. 4). Polished inventory levels down since January, but remain significantly higher than this time last year. Jewelers focused on selling to Chinese tourists.
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