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Rapaport Weekly Market Comment

Mar 7, 2019 10:59 AM   By Rapaport News
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Diamond trade cautious after slow Hong Kong show. Demand selective and inventory levels high, with buyers insisting on deep discounts for goods under 0.50 ct. Low manufacturing profits reducing Indian polished production as smaller goods not making money. 0.30ct. RAPI -0.6%, 1 ct. RAPI +0.1% in Feb. with better market for 0.70 to 1.99 ct. De Beers prices flat at $490 million sight. Far East consumer outlook improving as US and China approach trade deal. Chinese retailers restocking after Lunar New Year, with Hong Kong jewelry and luxury sales +5% to $1.1B in Jan. HRD adopts natural-diamond grading language for synthetics reports.

Fancies: Fancy-shape market stable, driven by US and European demand for fashion jewelry. Supply shortage supporting prices for Pears. Radiants improving. Marquises and Princesses weak. Excellent-cut Ovals, Pears and Emeralds doing well, with steady demand for fine-quality goods in 6 to 10 ct., and prices firming for 3 to 5 ct. due to shortages. Chinese consumers seeking fancy shapes at better prices. US sustaining 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: US wholesale trading difficult due to high prices. Secondhand diamonds emerging as a more profitable market for small-stone dealers. Ovals strong. Retailers increasingly seeing lab-grown as viable option for low-budget customers.

Belgium: Dealers report sluggish sales at Hong Kong show, with diamonds above 10 carats moving slowly despite high expectations. Overall demand good for 1.00 to 2.99 ct., G-K, VS, 3X. Baselworld (Mar. 21 to 26) set to be smaller show than usual after high-profile exits.

Israel: Hong Kong show boosted activity, with steady demand for 0.70 to 1.99 ct. goods. Weaker movement in dossiers up to 0.49 ct., and 3 ct. and larger sizes. Fancy shapes slow, except pears and ovals with perfect cuts. Midstream facing difficulties due to high rough prices, with Israel losing further market share to India.

India: Manufacturers maintaining reduced production in quiet market. Margins under pressure due to high rough prices at De Beers sight and subdued polished demand. Steady orders for 0.50 to 1.99 ct., G-H, VS2-SI1 (3X, no fluorescence). Stones with good or fair cut very hard to sell. Melee stable, with selective demand for stars, but manufacturers want to sell bigger melee sizes, as they offer better profits. Traders and manufacturers showing growing interest in synthetics.

Hong Kong: Sentiment positive after show, with retailers replenishing stock following Chinese New Year sales. Exhibitors not lowering prices with strong demand for 1 ct., D-K, nice SIs in short supply. Chinese consumers moving away from 0.50 ct. category, opting for 0.30 or 1 ct., F-J goods. Alternative cuts popular and offering good margins. Sales of yellows and pinks improving. Dealers optimistic despite ongoing concerns about trade war.
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