PolishedPrices Market Report: Diamond Trade Quiet, Polished Prices Gain

Market Analysis
16/11/2015 13:37

According to the polishedprices Market Report, traders reported a generally quiet week of trading, with volumes expected to remain low for most of the month due to the Diwali holidays in India, though the main price index opened 1.2% higher than the previous Monday. The overall index is currently 10.0% lower than this time last year, and has lost 6.3% since the start of 2015, but Fine and Commercial quality diamonds posted healthy increases last week across all benchmark size ranges. The best performers were 0.5 carat Fine, which leapt 9.9%, and Fine 0.3 carats which rose 5.6%. Fine 1.0 carats had a volatile seven days but finished the week 5.3% higher. The main focus for sales remains in the US, where traders reported steady buying from retailers ahead of the Christmas holiday sales season, though there are signs of a slowdown in the higher priced jewelry market. According to Bain & Co., the luxury goods industry is set to post its worst year since 2009 globally. While local consumption in the US is rising, it is not enough to offset a drop in demand from tourists.

As for the rough trade, the Market Report states that, "De Beers’ small sight provided some respite to the rough market, which is grappling with a significant overhang and tight liquidity. Sentiment remained depressed. According to one industry source familiar with De Beers, the November sight last week was one of the lowest in the past 33 years – the smallest sight recorded in 1982 was $52 million." According to one trader in Antwerp, “The big question will be what happens after Diwali ... Most anticipate a recovery within the next 3 - 6 months, provided volumes sold by the main producers remain low, allowing inventory to come down."