Industry News by Nemesis

Rapaport Weekly Market Comment

February 24, 2017

High hopes for next week’s Hong Kong show after China jewelry sales improved during the Chinese New Year. Polished prices steady as suppliers await outcome of the show and defend high rough prices. Manufacturing rising with steady rough demand during sight week. De Beers 2016 earnings +159% to $667M, revenue +30% to $6.1B, to raise 2017 production from 27M to 31-33M cts. Lucara 2016 sales +32% to $296M, profit -9% to $71M. Petra Diamonds 1H revenue +48% to $229M, profit of $35M vs. $2M previous year. Dominion 2016 sales -21% to $571M, Ekati production +40% to 5.2M cts. India Jan. polished exports +3% to $1.6B, rough imports +28% to $1.3B. ALROSA CEO Andrey Zharkov to step down. 

Fancies: Fancy-shape demand improving slightly with shortages of fine-quality, large Pears and Ovals. Cushions making comeback. Emeralds selling better than Princesses. Some demand for big fancy shapes, but buyers extremely picky. U.S. demand steady, Far East fancy shape demand weak. Large 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 market stable with buyers looking for deals and pushing for higher discounts. Steady demand for 1 to 2.99 ct., D-J, VS1-SI1 diamonds. Rising interest in fancy color diamonds and color gemstones. Ovals, Cushions and Emeralds the strongest fancy shapes. Jewelry retail sales expected to slow until start of summer wedding period. 

Belgium: Sentiment weak as trading slowed in February. Difficult to find the right goods at the right price. Dealers shifting from 3X to 3VG to meet lower price-point demand. Steady demand for nice-make GIA dossiers (RapSpec A2+). Fancy blue and pink diamonds strong. Selective demand for fancy shapes with Hearts improving. Rough trading stable during De Beers sight. 

Israel: Trading slowed after busy International Diamond Week. Rising expectations for Hong Kong show (Feb. 28 to Mar. 4) with large delegation of 83 exhibitors in Israel pavilion. Buying reserved ahead of the show as dealers have enough inventory to sell at the event. Steady demand for 1 to 3 ct., G-J, VS-SI diamonds. 

India: Trading cautious with foreign buyers looking for bargains and dealers waiting for better prices at the Hong Kong show. Domestic demand quiet with small independent retailers still acclimatizing to new demonetization rules. Steady demand for 1 ct., G-J, VS-SI diamonds. Manufacturing back to normal levels with shortage of small Indian rough during sight week. 

Hong Kong: Positive sentiment as trading improves ahead of the show. Buyers looking for goods as they expect suppliers to hold prices firm during the show in order to cover exhibition expenses. Steady demand for 0.30 to 0.70 ct., D-J, VVS2-SI1, RapSpec A2+ diamonds and for 1 ct., G-H, VS-SI, VG+ diamonds. Improving demand for 1 to 2 ct., fancy yellow, VS-SI diamonds. Steady engagement ring and bridal demand in mainland China.

 

Source: Rapaport

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