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Reduced Diamond Supply Lifts Polished Prices

RAPI for 1ct. up 1.9% in July

Aug 4, 2020 5:00 AM   By Rapaport
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RAPAPORT PRESS RELEASE, August 4, 2020, Las Vegas… Polished diamond prices firmed in July due to supply shortages for select categories. Sentiment remained weak and trading levels low amid new Covid-19 restrictions.

The RapNet Diamond Index (RAPI™) for 1-carat polished diamonds rose 1.9% during the month, buoyed by improving investment demand and scarcity of D, IF diamonds. The index has fallen 4.8% since the beginning of the year.

RapNet Diamond Index (RAPI™)
July Year to date
Jan. 1 to Aug. 1
Year on year
Aug. 1, 2019, to Aug. 1 2020
RAPI 0.30 ct. 2.0% -4.8% 3.2%
RAPI 0.50 ct. 4.5% -1.2% 0.8%
RAPI 1 ct. 1.9% -4.8% -6.1%
RAPI 3 ct. -0.8% -5.5% -8.8%
© Copyright 2020, Rapaport USA Inc.

Rough buying declined sharply due to lower polished demand and the forced reduction of manufacturing operations. De Beers’ and Alrosa’s decision to let clients refuse contracted supply has eased midstream liquidity concerns and helped prevent a buildup of polished inventory. 

Manufacturers’ profit margins are better than before the pandemic. Polished prices have firmed for select goods, and cutters are able to buy rough that aligns with demand. Polished dealer activity is limited to online platforms. Jewelers are ordering specific items rather than bulk inventory.

Trading has become more localized as interruptions at customs have caused shipping delays. This has empowered suppliers in some centers to maintain higher prices due to shortages in their localities. Polished inventory levels have fallen, but mining companies continue holding large volumes of rough they have been unable to sell.

The weak market is forcing companies throughout the supply chain to rethink their long-term strategies. Many businesses are adopting technological tools to improve efficiency. Mining companies recognize that they will need to customize rough supply to match consumer demand. Retailers are increasingly requesting digitized access to suppliers’ inventory so consumers can cherry-pick the diamonds they want.

While market conditions remain difficult, the diamond industry has an opportunity to implement technological innovations that will help inventory flow more efficiently through the supply chain. That should result in a more profitable trade. It should also ease the burden on manufacturers forced to hold large quantities of unwanted diamonds that have put pressure on polished prices over the past decade.

For in-depth diamond price, supply and demand data, subscribe to the Rapaport Research Report here.

Rapaport Media Contacts: media@diamonds.net
US: Sherri Hendricks +1-702-893-9400
International: Alex Shine +1-718-878-5138
Mumbai: Prashant Bhojani +91-97694-66855

About the Rapaport Research Report: The Rapaport Research Report provides subscribers with in-depth analysis of key themes affecting the diamond market. It also presents exclusive analytics on diamond prices for a variety of categories, based on sales and inventory data from RapNet®.

About the Rapaport RapNet Diamond Index (RAPI™): The RAPI is the average asking price in hundred $/ct. of the 10% best-priced diamonds, for each of the top 25 quality round diamonds (D-H, IF-VS2, GIA-graded, RapSpec-A3 and better) offered for sale on RapNet® (www.rapnet.com). Additional information is available at www.diamonds.net.

About the Rapaport Group: The Rapaport Group is an international network of companies providing added-value services that support the development of ethical, transparent, competitive and efficient diamond and jewelry markets. Established in 1976, the group has more than 20,000 clients in over 121 countries. Group activities include Rapaport Information Services, providing the Rapaport benchmark Price List for diamonds, as well as research, analysis and news; RapNet, the world’s largest diamond trading network; Rapaport Laboratory Services, providing GIA and Rapaport gemological services in India, Israel and Belgium; and Rapaport Trading and Auction Services, the world’s largest recycler of diamonds, selling over 500,000 carats of diamonds a year. Additional information is available at www.diamonds.net.

Image: Sorter inspects rough diamonds. (De Beers)
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Tags: Alrosa, De Beers, diamonds, Jewelry, Rapaport, RAPI
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