Industry News by Nemesis

Rapaport Weekly Market Comment

February 9, 2018

Positive sentiment, with rising expectations for the Chinese New Year retail season. Busy trading at Israel’s International Diamond Week, with momentum expected to continue through the Hong Kong show (Feb. 27). US retailers restocking and hoping for positive Valentine’s Day sales, despite recent drop in equity markets. Polished prices firm, with 1 ct. RAPI +2.2% in Jan. Manufacturers concerned about rising rough prices cutting their profits. Titan Company 3Q sales +7% to $670M, profit +21% to $44M. Rio Tinto 2017 diamond revenue +15% to $706M, earnings +96% to $92M. Gem Diamonds 2017 sales +12% to $207M. Belgium 2017 polished exports -3% to $11.4B, rough imports -11% to $10.7B. 

Fancies: Fancy shapes mixed, with curves better than squares. Ovals hot, followed by Pears and Cushions. Emeralds and Radiants OK, Princesses still weak. Oversizes selling well. Steady demand for fine-quality 6 to 10 ct. Ovals, Pears and Emeralds, with limited supply. US supporting market for commercial-quality, medium-priced fancies under 1 ct. Far East demand improving as consumers seek fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts. 

United States: Steady New York trading, but dealers finding it difficult to replace sold inventory at current prices. Shortages in select categories influencing rise in manufacturing, despite concerns about higher rough prices. Good demand for RapSpec A2+ SIs (3X, no-fluorescence). Jewelry retail slightly slow in January, with some caution after recent stock-market slump. Focus on engagement rings, with Valentine’s Day promotions. 

Belgium: Positive sentiment. Good European demand for HRD-graded diamonds. Steady dealer trading, with Israeli and Indian buyers in Antwerp looking for goods. Far East demand slower as Hong Kong wholesalers closed for the Chinese New Year. Good demand for 1 ct., F-G, VS diamonds. Rough trading stable, with strong premiums for De Beers and Alrosa goods on the dealer market. 

Israel: Upbeat atmosphere during International Diamond Week. Good local trading, and strong Indian, US and Chinese buyer presence. Polished prices firm, supported by shortages of RapSpec A2+ diamonds. Good demand for 1 ct., G-J, VS-SI (3X, no-fluorescence) diamonds. Bourse pushing tech innovation to advance the country’s position in the global diamond trade. 

India: Suppliers gaining confidence ahead of important Hong Kong show. Manufacturers raising polished production as they prepare inventory for the fair and in anticipation of good post-holiday US and Chinese demand. Steady demand for 1 ct., I-L, SI diamonds. Increase in import duty on polished diamonds to 5% will hurt the recutting sector. Steady jewelry-sales growth for large, established brands. 

Hong Kong: Wholesale market quiet as dealers take vacation for Chinese New Year. Good demand for 1 to 2 ct., D-J, VS-SI, RapSpec A2 diamonds. Focus shifts to retail, with jewelers optimistic for growth during the important selling season that began this week. Online retailers gaining market share, but at tight profit margins. Dealers preparing for upcoming exhibition.


Source: Rapaport

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