Rapaport Weekly Market Comment

Jul 5, 2018 10:59 AM By Rapaport News

Diamond market slows as US wholesalers take vacation. Positive sentiment continues after polished prices strengthen in second quarter. 1 ct. RAPI +0.8% in June. Manufacturers upholding discounts as they defend high rough prices. Depreciation of currencies in China and India reducing budgets of local dealers and causing shift in demand to lower qualities. Diamantaires aligning their inventory with retailers’ needs and mining supply, resulting in slightly lower stock levels than this time last year. Improving demand for 0.70 ct., G-J, VS-SI, RapSpec A3+ after extended weak period. Belgium June rough imports -13% to $864M. Botswana’s Okavango joins GIA M2M tracking program.

Fancies: Fancy shapes mixed, with curves better than squares. Ovals hot, followed by Emeralds, Pears and Cushions. Marquises and Princesses weak. Oversizes selling well. Steady demand for fine-quality 6 to 10 ct. Ovals, Pears and Emeralds, with prices firming for 3 to 5 ct. due to shortages. 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: Dealer market quiet, with many businesses closed for two weeks around Independence Day. Stable engagement and bridal sales during summer wedding season. Some fashion jewelry promotions over July 4 holiday.

Belgium: Slight lull in activity. Strong demand for 3X, no-fluorescence goods, and VG also getting firm prices. F-H, VS-SI dossiers selling well. European jewelers looking for fancy shapes. Rough trading stable, but dealers and manufacturers concerned about tight margins between rough and polished.

Israel: Polished trading seasonally slow as US clients take vacation. Far East demand steady, with good orders for 0.30 to 0.50 ct., G-H, VS-SI RapSpec A3+ diamonds. Dealers expecting market improvement from September Hong Kong show. High rough prices limiting manufacturers’ profit. Bourse president Yoram Dvash urges Gujarat state minister to reduce India’s 5% polished import duty to encourage India-Israel diamond trade.

India: Sentiment weaker amid bankruptcy rumors. Local buyers cautious due to firm polished prices and recent rupee depreciation against the dollar (-2.4% in June to $1 = INR 68.80). Fewer foreign buyers in Mumbai, owing to US summer vacation. Good demand for 0.30 to 3 ct., G-J, VS-SI, RapSpec A3+ diamonds. Manufacturing steady after $575 million De Beers June sight.

Hong Kong: Market activity down after June show. Buyers limited by higher polished prices and weaker yuan currency (-3.5% in June to $1 = CNY 6.64). Solid demand for 0.30 to 1 ct., G-H, VS-SI, RapSpec A2+ diamonds. Retailers optimistic after rise in 1H tourist arrivals. Concern about potential impact of US-China trade dispute.

Rapaport Weekly Market Comment

Polished trading seasonally quiet. Asian demand driving activity during US vacation period. Chinese buyers shifting to lower colors amid yuan currency devaluation (-4% since June 1 to CNY 6.67/$1). Weaker yuan will also impact tourist jewelry shopping. Dossiers selling well, with good orders for 0.50 ct., D-M, VS-SI, RapSpec A2+ diamonds. Polished suppliers maintaining steady prices after rough-price hikes. Miners limiting 2018 supply after global 2017 KP rough production +29% to $15.9B, volume +19% to 151M cts., average price +8% to $105/ct. Alrosa 1H sales estimated +8% to $2.7B. Petra Diamonds sells 76% stake in Kimberley operations to Ekapa Mining for $22M.

Fancies: Fancy shapes mixed, with curves better than squares. Ovals hot, followed by Emeralds, Pears and Cushions. Marquises and Princesses weak. Oversizes selling well. Steady demand for fine-quality 6 to 10 ct. Ovals, Pears and Emeralds, with prices firming for 3 to 5 ct. due to shortages. 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: Trading quiet, with dealers on vacation. Activity expected to remain slow through July and August. Buyers looking for bargains over summer, but suppliers maintaining firm prices. Retailers insisting on memo rather than buying. Jewelry sales steady, with seasonal bridal demand during ongoing wedding period.

Belgium: Stable market, with good orders for 0.30 to 0.50 ct. and 1 ct., F-H, VVS-SI dossiers. RapSpec A2, 3X, no-florescence are fastest sellers. Below 0.30 ct. weakening. Larger fancy shapes with high color and nice cut for European high end doing well. Dealers cautious about buying too much inventory before August vacation.

Israel: Trading subdued due to US vacation. Solid Chinese demand, with shift toward J-L-color goods. 0.30 and 1 ct., G-L, VVS2-SI2 moving well, along with 0.50 ct. diamonds of all colors and clarities. Availability of 1 ct. rising. Manufacturers concerned about high rough prices and tight profit margins.

India: Sentiment down somewhat as rupee currency devaluation (-7% since Jan. 1 to INR 68.8/$1) affects local transactions. Buyers cautious due to higher polished prices and weaker exchange rate. Suppliers maintaining prices with slightly lower polished production. Steady interest in 1 ct., J-L, SI1-I2 diamonds. Rise in availability of 0.50 ct., D-H, IF-VS stones.

Hong Kong: Trading relatively quiet since June show. Chinese buyers restrained amid yuan devaluation. Shift to smaller and cheaper goods, with stable demand for lower colors. Jewelers holding relatively large inventory after strong 1H buying. Retailers raising promotional activity to boost summer sales.

RAPAPORT... Botswana once again finds itself at a crossroads. The sparsely populated, landlocked country is in a constant battle to ensure the longevity of its diamond industry.

Recognizing that diamond mining will not last forever, the government’s beneficiation program has sought to establish cutting and polishing, trading, and auxiliary services in an effort to diversify its industry — and economy — away from its reliance on the mining sector.

Beyond mining

De Beers, which counts around 59% of its production by value in Botswana, has played no small part in that effort. It did so initially by earmarking a part of its rough supply to be manufactured in Botswana, and today there are 18 sightholders with factories in the country. In 2013, De Beers moved its sales headquarters to Gaborone, meaning that its 10 annual sights were taken out of London, thus diverting traffic and diamond-related activity to the African city.

Furthermore, the establishment of the parastatal Okavango Diamond Company that same year gave the government access to 15% of production by Debswana, its joint mining venture with De Beers. That was the first time substantial rough sales from Debswana took place outside of the De Beers system.

The 2011 agreement that governed those developments is up for renewal in 2020, and negotiations are expected to begin in the coming year. For its part, the government is seeking to increase supply to local sightholders as a means of creating more jobs, newly elected President Mokgweetsi Masisi told Bloomberg in May.

Some question whether Botswana can handle more manufacturing, given that a few factories have closed in recent years. If profitability remains the biggest challenge facing manufacturers, Gaborone has yet to prove itself as a viable center for high-volume cutting. Perhaps De Beers can play a further role there, too.

The government will also likely want to increase the percentage of Debswana supply that Okavango receives. And it might want to renegotiate greater access to the large and high-value diamonds Debswana recovers.

Digging deep

Botswana has some leverage in the relationship with De Beers. It owns a 15% stake in the group, with Anglo American holding the remaining 85%. And the two are equal partners in Debswana and in DTC Botswana, which sorts and mixes production for De Beers and Okavango.

De Beers, meanwhile, brings to the table its mining expertise and budget. In 2010, it committed to investing $3 billion over 15 years in the Cut-8 expansion of the Jwaneng mine — considered the world’s most valuable diamond-producing asset.

That project is already the main source of ore at Jwaneng and is expected to extend the life of mine to 2030 and by some 93 million carats. Studies for the viability of Cut-9 are under way, which would further extend the life of Jwaneng. A final investment decision on the project is expected later this year, reports a De Beers spokesperson.

De Beers could use the potential Cut-9 investment, as well as funding extensions at the Orapa and Letlhakane mines, as a bargaining tool in negotiations with the government.

African investments

De Beers walks a similarly fine line in other African countries where it operates.

In South Africa, it may have to reduce ownership of its local businesses from 74% to 70% under the new mining charter, as the government wants to see more local black economic empowerment (BEE) involvement. That said, De Beers is engaged in a $2 billion project to develop underground mining at the Venetia asset. From next year, Venetia will be its only mine in South Africa, as it plans to close the Voorspoed mine. It has already sold the Finsch, Cullinan and Kimberley operations over the past decade.

Meanwhile, in May 2016, De Beers signed a 10-year sales agreement with Namibia, in which it ceded 15% of local supply to the government and promised more diamonds to local cutters. The company subsequently announced major investments in its marine mining operations off the Namibian coast.

It’s that give-and-take that Masisi is hoping will result in a “win-win” for both parties as they negotiate their next long-term deal — especially given that so much of Botswana’s future diamond production depends on Jwaneng’s expansion.

“We have had a wonderful relationship with De Beers, and we expect that relationship to be even more cemented,” the president told Bloomberg in May. “The returns [from the Jwaneng development] are going to be realized in the period of the next deal. This is a marriage we’re after.”

Alrosa Plans to Dominate Colored-Diamond Market

Jul 15, 2018

RAPAPORT... Alrosa is planning to become the world’s largest producer of polished colored diamonds, with the entire mine-to-customer process handled in-house.

“We think we will be able to integrate into this segment and even dominate it,” a company spokesperson told Rapaport News Sunday. “As Alrosa is the largest diamond miner, it is reasonable to expect today [that] we are the largest miner of colored rough diamonds as well.”

While polishing is currently only a small part of its business, the Russia-based miner launched this division several years ago. Last year, the company began focusing intensively on cutting unusual diamonds.

“We have enough experience to work with colored stones,” the spokesperson added. “We have a very strong cutting division, rich traditions and unique masters who still remember what a real Russian cut is.”

Alrosa is currently working on cutting and polishing a large assortment of colored diamonds from its mines, including yellow, turquoise, purple and pink stones. The miner will debut the collection in September at the Hong Kong Gem & Jewellery Fair, after which the stones will go up for auction.

One of Alrosa’s most prominent colored diamonds is a 27.85-carat pink stone (pictured), which it recovered last year. The nearly inclusion-free gem is the largest pink the company has ever found, and is expected to fetch approximately $500,000 per carat at auction. It is the most expensive rough in the history of Russian diamond mining, Alrosa claims.

The company is cutting and polishing the pink diamond through its Diamonds Alrosa enterprise, with the assistance of an international consultant. The stone will not be finished in time for the upcoming September auction, but will be sold at a later tender.

One potential advantage Alrosa sees is that the polished stone’s origin is completely transparent.

Sú až také vzácne? Geológovia objavili biliardy ton diamantov 😉

Hmmm , ťažbu budú môcť robiť myslím "mimozemšťania" v tomto tisícročí my to určite nebudeme ...

Rapaport Weekly Market Comment

Jul 19, 2018 10:59

Slow trading, with dealers in summer vacation mode. Bargain-hunters asking for higher discounts during quiet period, but suppliers holding prices firm. Difficult to replace goods after recent price hikes and with fewer RapSpec A2+ goods on the market. US retail seasonally slow, but e-commerce strong as record Prime Day sales exceed Amazon’s Cyber Monday and Black Friday. Asia growth continues with Chow Tai Fook 2Q same-store sales +4% in China, +26% in Hong Kong/Macau. Concerns weaker yuan will impact 3Q consumer spending. Rough trading stable, with lower volumes supporting prices. De Beers 1H production +8% to 17.5M cts., sales -7% to 17.8M cts., average price +4% to $162/ct.

Fancies: Far East demand improving as Chinese consumers seek Pears and Princesses at better prices. US and European demand mixed, with curves better than squares. Ovals hot, followed by Emeralds, Pears and Cushions. Marquises and Princesses weak. Oversizes selling well. Steady demand for fine-quality 6 to 10 ct. Ovals, Pears and Emeralds, with prices firming for 3 to 5 ct. due to shortages. US supporting market for commercial-quality, medium-priced fancies under 1 ct. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Dealers slowly returning from vacation, but finding it difficult to replace goods they sold before July 4 break. Sales up from last year, but profit is tight. Suppliers holding prices firm amid shortages. JA show very quiet. Retail also slow, with some bridal demand during summer wedding season.

Belgium: Fewer orders, with dealers prepared to wait through the vacation period rather than sell at lower prices. Bourses scheduled to close for two weeks at end of July. Good market for 0.30 to 1.20 ct., D-H, VVS2-SI diamonds. Nice-make fancy shapes selling well, with smaller Pears and Ovals in short supply and high demand. Rough trading steady ahead of next week’s De Beers sight.

Israel: Stable prices in quiet market. Solid demand for 0.70 ct., D, IF, and 1 ct., K-L, IF-VS2 diamonds. Local dealers looking for goods during quiet summer months, with some categories selling at lower prices in the US than in India. Melee trading weak, in part due to jewelers buying directly from manufacturers. Industry lobbying banks to raise credit.

India: Sentiment down due to sluggish summer demand, depreciating rupee and rumors of further bankruptcies. Dealers also frustrated by slower turnover, as authorities withhold shipments following $440 million fraud involving customs officials. Fewer overseas buyers in the market. 1 ct. and dossiers moving well. Rough demand stable, but manufacturers careful not to build up excess inventory.

Hong Kong: Cautious market sentiment due to summer slowdown and weaker yuan. Steady demand for 0.30 to 1 ct., D-M, VS-SI diamonds. Buyers willing to pay strong premium for 3X over 3VG. Improving demand for 3 ct. and larger stones, but shortages are restraining deals. Rising interest in fancy shapes and fancy color diamonds

AIGS upozorňuje na Fake Gem certifikáty.

Jul 22, 2018 7:49 Od Rapaport News

RAPAPORT ... Asijský inštitút pre gemologické vedy (AIGS) vydal varovanie medzinárodnému diamantovému priemyslu pred falošnými drahokamami s logom.

Falošné certifikáty obsahujú funkčný QR kód, ktorý nasmeruje používateľov na falošnú webovú stránku s príponou co, namiesto com.

Falošný certifikát (vľavo), pravý certifikát (vpravo). Úver: AIGS.

"Niektorí bezohľadní ľudia sa rozhodli oklamať zákazníkov pomocou názvu AIGS," uviedol predseda AIGS Kennedy Ho minulý týždeň. "Naozaj vytvorili falošné certifikáty AIGS, ktoré vyzerajú ako skutočné certifikáty."

Jediným spôsobom, ako si byť istý, že certifikát je pravdivý, je priamo skontrolovať webové stránky AIGS alebo poslať AIGS fotografiu certifikátu e-mailom, poznamenal.

AIGS plánuje podniknúť právne kroky proti falšovateľom, dodal Ho.

Hlavný obrázok: Renu.M / Shutterstock

Aby som bol v strehu...🙂
-s-

To sme tu teraz všetci ako na ihlách.😃