Rapaport Magazine
Economics

Global Diamond Demand

April 2008

By Rapaport
RAPAPORT... Antwerp
Round
• Demand is good across the board for cleanish goods in VVS-VS, D-I. 
  Polished prices increased by 10 percent in one recent week, which is 
  considered justified in the current market.
• SI, P are increasingly difficult to move because of weakened U.S. market.  
   Diamonds are no longer a priority for middle-income consumers.

Fancy shapes
• 3 carat+ in nice makes in marquises and pears are moving well across the 
  board.

China
• Demand is good for 0.30 to 0.70 carat G+/VS+.
• 1/2 carat D-G/VS+ is popular.
• Larger stones in 1 carat+/VS+/H+, GIA certified and fine make, continue 
   to sell well.
• The market is getting more diversified and is accepting a wider range of
   colors and clarities, but the round shape still prevails.

Hong Kong
• Demand for large diamonds is still strong.
• High colors in D-E in SI are becoming more popular.
• Demand continues to be very strong in H-J colors in all sizes, better clarities
   and VVS.
• Demand for setting sizes is sluggish and is expected to weaken during 
  coming summer months because of the depressed U.S. market, gaining only
  toward the end of 2008.

India
• Sales of size goods have been slow, due to a major rise in prices and 
  exchange rate fluctuations. Buyers are resisting until discount adjustments 
  settle in.
• Manufacturing of small goods is not in full force, due to high asking prices 
   for rough and a shortage of rough in this category, leading to shortages of
   product to fill local and export orders.
• Demand is strong for -2 and melee goods but shortages persist across the
   board.
• Movement is stable for 0.01 to 0.18 carats in I1+ goods in J+.
• Demand is good for 0.50, 0.70 and 0.90 carats in SI+, J+.
• Demand is consistent across the board for 1 carat.
• 2 carats have picked up movement after a sluggish period, despite price
   increases of 5 to 7 percent.

Israel
• There was a clear shift in polished export numbers for January and
   February  as Israel sent more to Hong Kong than to the U.S.
• Traders expect price increases to continue, especially for 3 carats+.
• Rough prices are expected to continue to rise.
• 3 carats remain in strong demand and 50- to 
  70-pointers are moving well.
• 10 carats+ are quiet as buyers adjust to new prices.
• Demand is good for clean goods, particularly in VS2+ and fancy colors.
• Traders are optimistic that the Basel show will pick up where strong Far
   East events left off.

Japan
• With a strong yen and a weaker dollar, foreign buying has subsided, making
   it easier for Japanese buyers to buy. The dealer market appears to be
   reviving.
• The market for high-color, well-made 4/4 is strong but it is difficult to sell
   outside these parameters.
• Pointers, which have been lagging in the market, have become very strong
   due to high rough prices.
• The prices of capes are stable, helped by the stronger yen.
• Smalls, such as melees and stars, are very strong and Indian manufacturers 
  are suspected of no longer working in that size.

Russia
• ALROSA and Diamond Chamber of Russia sold 11.7 thousand carats
  worth $42.6 million at their 27th auction on February 28, 2008.
• Almost all 725 stones offered were sold, including seven stones weighing
  more than 50 carats. The biggest stone auctioned was 88.99 carats and one
  of the lots sold at the record price of $25,000 per carat.
• ALROSA also sold $2.37 million worth of rough diamonds at its second
  auction at the Hong Kong Jewellery Show and sold 52 polished diamonds
  for $1.8 million at the same show.

U.S. Retail
• Most popular color is yellow, most popular sizes are 2 to 5 carats and
  preferred quality is fancy to fancy intense.
• Best-selling colored diamond categories: rings, followed by pendants and
  earrings.
• Best-selling colored diamond item: three-stone ring with a colored center.
• Other popular items: pavé stack rings, black diamond beads and
   multicolored designs.

U.S. Wholesale
• Round and princess cuts are very popular.
• Journey and circle pendants have slowed.
• Browns are selling well in sizes from 1 point to 1 carat and above.
• Yellows in the 3- to 5-carat range are meeting strong demand.
• Pinks are moving rapidly.

Article from the Rapaport Magazine - April 2008. To subscribe click here.

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