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Rapaport Weekly Market Comment

Aug 1, 2019 10:58 AM   By Rapaport News
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Rough sales plummet due to lack of profit and liquidity squeeze. Midstream pressures caused by high 2017/18 rough supply at inflated prices, combined with tighter inventory controls by retailers. Sightholders refuse goods as De Beers keeps prices stable at $250M July sight. Rio Tinto 1H diamond revenue -16% to $271M, loss of $5M. Polished prices continue to soften, with July 1 ct. RAPI -0.9%. Rough prices must come down to restore profitable trade. Miners and brands need to invest significantly more to raise diamond-jewelry demand. Israel bourse publishes second “I Love Natural Diamonds” social-media video. Jewelers of America raises $300,000 to test consumer-focused ad campaign.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying best prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: New York dealers cautious. Melee market slow. Some interest in large stones, but buyers offering low prices that suppliers are refusing. Manufacturers of niche shapes such as rose cuts and briolettes doing well. Jewelers monitoring available inventory and price levels as they assess their stock requirements for the holiday season.

Belgium: Very little activity, with most diamantaires on summer vacation. Bourses closed until August 22. Some Antwerp-based Indian dealers in Mumbai looking for goods.

Israel: Polished trading quiet, with dealers ready to take early vacation. Bourse to close from August 12 to 22 for summer break. Inventory coming down due to reduced Indian manufacturing, but RapSpec A3+ goods still difficult to sell and prices are softening. Widening gap between none and faint fluorescence. Ovals and pears best-selling fancy shapes.

India: Some improvement from last week, with more foreign buyers looking for goods. US demand supporting the market. Manufacturers still under pressure and maintaining low production levels. Not much buzz for next week’s IIJS Mumbai show, with gold-jewelry suppliers concerned about high gold price. Rough trading slow after small De Beers July sight.

Hong Kong: Sentiment weak as ongoing protests and trade war impact wholesale and retail sales. Jewelers maintaining low stock and shifting to lower price points. Some improvement in 0.30 to 0.49 ct., J-M, SI diamonds. Goods above 2 ct. weak, with buyers pushing for deeper discounts. Major jewelers focused on driving sales in mainland China, rather than Hong Kong.
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