Diamond markets were quiet in April. Many polished diamond suppliers did not lower their prices even though liquidity and profitability remain tight.
Sentiment improved slightly as shortages helped stabilize prices toward the end of the month , Rapaport reported .
The RapNet Diamond Index (RAPI™) for 1-carat laboratory-graded diamonds rose 0.4 percent in April. RAPI for 0.30-carat diamonds fell 1.9 percent and RAPI for 0.50-carat diamonds declined 1 percent. RAPI for 3-carat diamonds dropped by 1.5 percent during the month.
During the first four months of the year, RAPI for 1-carat diamonds increased 0.4 percent, but remained 13.9 percent down from one year ago on May 1.
RapNet Diamond Index (RAPI™)
According to the Rapaport Monthly Report – May 2015, “Muted Markets,” very few new polished diamonds have been entering the market. Diamond manufacturers are still losing money on overpriced rough and refused about 30 percent of rough supply in the first quarter.
Diamond mining companies are realigning their production with weaker rough demand. De Beers lowered its planned production for 2015 as sightholder refusals suggest that the company is holding a relatively large rough diamond inventory. Polished production has been significantly reduced since the October Diwali break and factories are maintaining lower output and extending the ongoing summer vacation period in India.
Diamantaires are focused on buying polished rather than rough for manufacturing. However, polished trading has been soft as demand was weak from jewelry retailers. Diamond buyers have limited their buildup of inventory in a downward-trending market and demand has been order specific.
Retail sales have been weak in the Far East and steady in the U.S. However, sentiment is positive among U.S. retailers and many are expected to start looking for goods ahead of the summer wedding season. Expectations are therefore rising for the upcoming Las Vegas shows. As polished inventories are slowly being depleted, the hope is that the shows will signal stronger trading in the second half of the year than during the first.
