Rapaport Weekly Market Comment

Jun 27, 2019 10:58 AM

Sentiment weak amid ongoing liquidity concerns. Polished production reduced by estimated 30% in 2019 due to high inventory, sluggish demand and tight manufacturing profits. Recent rough-price cuts not enough to reboot the market. De Beers June sales slump 33% to $390M, 1H sales -18% to $2.4B. Quiet Hong Kong fair highlights show fatigue and cautious Far East demand as geopolitical tensions fuel economic uncertainty. Gold rallies +8% to $1,402 an ounce (June 1-27) as investors seek assets with store of value. Belgium May polished exports flat at $1.2B, rough imports -16% to $761M. India May polished exports -15% to $1.9B, rough imports -35% to $1B. Tara Jewels files bankruptcy.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying the strongest prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially VS2-SI2. Demand for Radiants and Emeralds down. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: New York market slow ahead of summer break: Diamond Dealers Club to close June 28 to July 9. Steady flow of memo calls, but jewelers not buying for stock. 1 ct., G-J, SI-I1, RapSpec A3+ selling well. Bridal supporting retail sector during wedding season, but concerns consumers are reducing engagement-ring spend. Vintage designs popular and selling better than modern styles.

Belgium: Polished trading quiet, as dealers return from disappointing Hong Kong Jewellery & Gem Fair. Suppliers cautious about giving credit, and are offering better cash prices. Stable demand for 1 ct., G-I, VVS, RapSpec A3+. Ovals and pears improving, but other fancy shapes weak. Rough market cautious after De Beers sight, with rough below 4 ct. selling at a loss among dealers.

Israel: US-focused memo houses doing well. 1 to 3 ct. goods in demand: the lower the clarity, the better the market. Large-stone dealers uncertain as they struggle to maintain price levels. Suppliers to Far East lacking orders, with Hong Kong show doing little to boost sentiment. Top-make fancy shapes hard to find. Rough dealers cautious.

India: Sluggish activity and weak sentiment amid persistent bankruptcy rumors. Buyers looking for bargains and sense suppliers are under pressure. Cutters despondent due to low profitability, even after rough-price cuts. Manufacturers reducing production or shifting to low-cost items to keep workers occupied. Polished inventory levels high, but shortages emerging in popular categories such as top-make SIs (3X, no-fluorescence).

Hong Kong: Last week’s show very quiet. Dealers more interested in larger September fair, but maintaining cautious outlook for 2H. Political protests and trade war affecting business, with Chinese buyers staying away. Dealers focused on dossiers, with steady demand for 0.30 to 0.50 ct., F-J, VS-SI, RapSpec A3+. Jewelry retail slowing after solid fiscal year ending March 31.

RAPAPORT ... Gem Diamonds vymenoval Mazviho Maharasoa, bývalého šéfa banskej operácie Letšeng v Lesothu, ako nevýkonného riaditeľa pre skupinu.

Maharasoa má viac ako 20 rokov skúseností v oblasti senior managementu, vrátane diamantov Letšeng, kde pôsobila v rokoch 2009 až 2017 ako generálna riaditeľka. Bola tiež zakladateľom a predsedníčkou baníckej komory Lesotho. Ministerstvo prírodných zdrojov a centrálna banka Lesotho. Jej nová úloha nadobudla účinnosť v pondelok.

"Sme ... sme presvedčení, že jej schopnosti a skúsenosti v oblasti baníctva a zdrojov a správy a riadenia spoločností prinesú do správnej rady veľkú hodnotu," povedal predseda predstavenstva spoločnosti Gem Diamonds Harry Kenyon-Slaney.

Obrázky:

Financial Data
Metals
Gold 1,393.13 +0.77%

Silver 15.17 +0.17%

Platinum 834.60 +0.30%

Palladium 1,553.63 +0.41%

Currencies
Euro $1.13 +0.02%

Pound $1.26 -0.22%

Yuan($) 6.88 +0.39%

Rupee($) 69.01 +0.17%

Indices
S&P 500 2,901.52 +0.01%

FTSE 100 7,432.42 -1.11%

Hang Seng 27,906.59 -0.91%

Shanghai 2,725.25 -0.46%

Sensex 38,645.07 -0.12%

Stocks
Tiffany & Co. $94.28 +0.68%

Signet Jewelers $17.26 -3.47%

Chow Tai Fook HKD 8.50 +3.53%

LVMH €374.60 +0.08%

Petra Diamonds GBX 20.00 +1.63%

Rapaport Weekly Market Comment

Jul 4, 2019 10:58 AM

Diamond market quiet as US dealers take vacation. America supporting the trade with steady retail sales and expected boost from Independence Day weekend. Midstream under pressure with tight liquidity, slow orders and excess inventory. Weak sentiment continues as polished prices soften. 1 ct. RAPI -1.4% in June. Manufacturers buying polished rather than rough, as they need to focus on profitability instead of turnover. Buyers taking advantage of suppliers’ need for cash and pushing for discounts. PwC predicts Hong Kong retail sales will slide 5% in 2019 as demonstrations, reduced tourist spending, and trade war affect business. Luk Fook FY revenue +9% to $2B, profit +10% to $193M.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying best prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Wholesale market quiet, with businesses closed for two-week summer break. Diamond Dealers Club of New York to reopen on July 9. Stable engagement and bridal sales during summer wedding season. Some fashion jewelry promotions over July 4 holiday.

Belgium: Polished market stable for 1 to 1.50 ct., G-J, VS-SI goods. D-F, IF-VVS categories continue to soften. Fancies moving better than rounds, with steady demand from European jewelers. Fancy-color diamonds relatively weak, particularly commercial-quality yellows. Rough trading quiet, with less available supply after small De Beers and Alrosa sales.

Israel: Slow activity with deep concerns about tight liquidity and lower sales. Many dealers have reduced operations in recent years, which has helped shield them from the current downturn. Stable demand for 1 ct., G-J, VS-SI, RapSpec A3+ diamonds. Bourse urges consumers to “love real diamonds” in social media video campaign. Click here for video.

India: Cautious sentiment amid ongoing liquidity concerns and sparse orders. Heavy monsoon rains affecting business, with delays in delivery and worker arrivals. Fewer foreign buyers in Mumbai. Good demand for top-make SIs and lower piqué goods. Manufacturers keeping production 30% to 40% below last year’s levels.

Hong Kong: Trading down due to sluggish demand, slow season and political protests. Steady market for 0.30 ct., D-H, VS-SI, RapSpec A3+ goods, but prices continue to soften. Jewelers putting price pressure on suppliers with liquidity issues. Fewer top-make SIs available. Retail sales sliding due to political protests, reduced tourist spending, and impact of trade war.

Rapaport Weekly Market Comment

Jul 11, 2019 10:58 AM

Diamond trade seasonally slow with concerns about weak demand and low profit. Oversupply continues despite drop in rough buying. Producers raising rough inventory as 1H sales slump and mine production remains steady. Alrosa 1H sales -32% to $1.8B. Kimberley Process reports 2018 global rough production +3% to $14.5B, volume -2% to 148.4M cts. Indian government raises gold import duty from 10% to 12.5% and keeps duty on polished diamonds at uncompetitive 8.25%. India’s introduction of separate import code for lab-grown rough diamonds is important step in differentiating natural from synthetic diamonds. Rapaport calls for implementation of such codes in US and other markets.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying best prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Polished trading slow, with some businesses closed for summer vacation. Weak sentiment among dealers in low-end melee as buyers push for deeper discounts. Better-quality G-H, VS-SI melee selling well. Fewer memo calls for single stones, in line with seasonal expectations. Steady orders for 1 ct., G-J, VS-I1 goods.

Belgium: Market quiet, supported by steady US demand. Dealer trading selective and price-sensitive. 0.30 to 1 ct., G-J SIs moving, but prices continue to soften. Large stones above 8 ct. weak. Fancy shapes doing okay, with nice-make ovals and pears selling well. Rough trading down as manufacturers continue to reduce factory output.

Israel: Fewer transactions, since many US wholesalers are on vacation and Far East customers remain cautious. Stable orders for 1 ct., G-J, VS-SI, RapSpec A3+ diamonds. Dealers expecting slow trading at least until September Hong Kong show. Shortage of fine-cut fancy shapes. Rough market sluggish, with manufacturers focused on reducing inventory.

India: Sentiment weak amid slow trading, tight liquidity and squeezed profits. Foreign buyers trying to take advantage by pushing for discounts. Domestic buyers cautious. Steady interest in 1 ct., G-J, SI goods. Strong gold demand supported jewelers in June, but rise in import duty to 12.5% expected to curb sales.

Hong Kong: Weak mood in market as ongoing protests and trade war hurt wholesale and retail sales. Drop in tourist arrivals is affecting jewelers, and local consumer confidence is down. Investors looking for safe-haven assets amid economic uncertainty and are choosing gold over diamonds. Stable demand for 1 ct., D-H, VS, RapSpec A3+ engagement-ring diamonds.

Rapaport Weekly Market Comment

Jul 11, 2019 10:58 AM

Diamond trade seasonally slow with concerns about weak demand and low profit. Oversupply continues despite drop in rough buying. Producers raising rough inventory as 1H sales slump and mine production remains steady. Alrosa 1H sales -32% to $1.8B. Kimberley Process reports 2018 global rough production +3% to $14.5B, volume -2% to 148.4M cts. Indian government raises gold import duty from 10% to 12.5% and keeps duty on polished diamonds at uncompetitive 8.25%. India’s introduction of separate import code for lab-grown rough diamonds is important step in differentiating natural from synthetic diamonds. Rapaport calls for implementation of such codes in US and other markets.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying best prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Polished trading slow, with some businesses closed for summer vacation. Weak sentiment among dealers in low-end melee as buyers push for deeper discounts. Better-quality G-H, VS-SI melee selling well. Fewer memo calls for single stones, in line with seasonal expectations. Steady orders for 1 ct., G-J, VS-I1 goods.

Belgium: Market quiet, supported by steady US demand. Dealer trading selective and price-sensitive. 0.30 to 1 ct., G-J SIs moving, but prices continue to soften. Large stones above 8 ct. weak. Fancy shapes doing okay, with nice-make ovals and pears selling well. Rough trading down as manufacturers continue to reduce factory output.

Israel: Fewer transactions, since many US wholesalers are on vacation and Far East customers remain cautious. Stable orders for 1 ct., G-J, VS-SI, RapSpec A3+ diamonds. Dealers expecting slow trading at least until September Hong Kong show. Shortage of fine-cut fancy shapes. Rough market sluggish, with manufacturers focused on reducing inventory.

India: Sentiment weak amid slow trading, tight liquidity and squeezed profits. Foreign buyers trying to take advantage by pushing for discounts. Domestic buyers cautious. Steady interest in 1 ct., G-J, SI goods. Strong gold demand supported jewelers in June, but rise in import duty to 12.5% expected to curb sales.

Hong Kong: Weak mood in market as ongoing protests and trade war hurt wholesale and retail sales. Drop in tourist arrivals is affecting jewelers, and local consumer confidence is down. Investors looking for safe-haven assets amid economic uncertainty and are choosing gold over diamonds. Stable demand for 1 ct., D-H, VS, RapSpec A3+ engagement-ring diamonds.

Rapaport Weekly Market Comment

Jul 18, 2019 10:58 AM

Diamond market weak due to summer slowdown and sluggish dealer demand. Manufacturers frustrated by tight profit margins and hoping for rough price reduction at De Beers July sight. Cutters maintaining low polished production due to profit and liquidity squeeze. ABN Amro restricts rough-sector lending out of concern for lack of profitability. Chow Tai Fook FY1Q same-store sales +11% in China, -11% in Hong Kong as political protests and strong dollar impact tourist luxury spending. De Beers 1H production -11% to 15.6M cts., sales volume -12% to 16.5M cts., average price -7% to $151/ct. Belgium June polished exports -20% to $836M, rough imports -21% to $681M.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying best prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Polished trading slow, with manufacturers cutting out dealers by selling directly to retailers. Suppliers considering lower offers to maintain cash flow and inventory turnover. Steady demand for RapSpec A3+, 1 to 2 ct., G-H SIs. Overall retail positive in June, despite reported decline in consumer confidence. Jewelry store sales -3% to $2.74 billion for the month, according to government data.

Belgium: Focus on rough ahead of next week’s sight, as July is traditionally a strong month for De Beers and Alrosa sales. Low activity ahead of summer vacations, which are scheduled for the beginning of August. Weak sentiment stemming from declines in other centers. US orders supporting the market. 0.30 to 0.60 ct., G-M, SI2 goods selling well.

Israel: Quiet trading, with rising concerns about drop in sentiment. Manufacturers note tight profitability ahead of De Beers sight. Stable US demand, with steady orders for 1 ct., G-H, VS-SI, RapSpec A3+ diamonds. 0.30 to 0.50 ct. and large stones above 3 ct. soft.Bourse delegation in Shanghai targeting improved business with Chinese traders.

India: Fewer transactions than this time last year, despite strong foreign-dealer presence in Mumbai. Buyers looking for bargains amid rumors of tight liquidity and financial distress. 0.30 ct. diamonds selling in parcels since prices of certified goods have declined. GIA has reduced grading fees for 0.30 by 10%. Solid demand for SI1-I2 parcels. Manufacturers maintaining low polished production.

Hong Kong: Wholesale and retail markets very slow due to ongoing political protests. Trade war making dealers cautious, even as jewelry retail sales in mainland China remain robust. Buyers moving away from 0.30 ct. Dealers reluctant to purchase in down-trending market. Some opting for 0.50 ct. instead. Soft trading expected at least until September show.

Financial Data
Metals
Gold 1,425.53 +0.56%

Silver 16.53 +0.79%

Platinum 863.53 +0.86%

Palladium 1,527.52 +0.16%

Currencies
Euro $1.11 -0.07%

Pound $1.25 +0.31%

Yuan($) 6.88 -0.05%

Rupee($) 69.03 -0.05%

Indices
S&P 500 2,901.52 +0.01%

FTSE 100 7,432.42 -1.11%

Hang Seng 27,906.59 -0.91%

Shanghai 2,725.25 -0.46%

Sensex 38,645.07 -0.12%

Stocks
Tiffany & Co. $92.53 +0.87%

Signet Jewelers $17.46 -2.02%

Chow Tai Fook HKD 8.46 +0.83%

LVMH €383.30 -0.39%

Petra Diamonds GBX 15.35 -6.52%

Rapaport Weekly Market Comment

Jul 25, 2019 10:58 AM

Summer lull continues. Polished suppliers cautious for 2H amid trade-war uncertainty, weak dealer demand and tight manufacturing profit. Miners reducing rough supply, with De Beers allowing additional deferrals at July sight. De Beers 1H revenue -17% to $2.6B, earnings -7% to $187M, rough price index -4%. Petra lowers 2020 production plan to 3.8M cts. US jewelry sales stable, despite weakness at majors and declining store count: JBT reports 185 retailers closed in 2Q, 56 opened. Tariff tensions and political protests impact Hong Kong luxury spending as Luk Fook FY1Q same-store sales -10%. New India data shows June lab-grown polished exports +64% to $24M, imports +132% to $16M.

Fancies: Fancy shapes soft, reflecting slowdown in high-end demand. 3 to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift to lower price points. Well-known brands are paying best prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak despite reduced manufacturing. US sustaining market for commercial-quality, medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Polished trading seasonally quiet. Buyers focused on round, 1.50 to 2.10 ct., G-H, VS-SI range of goods. Fancy shapes and other sizes slow. A lot of available inventory that’s difficult to move. Suppliers of melee shifting to better qualities to get better profit margins. Retail sales steady, but mall-based jewelers struggling.

Belgium: Active market before the bourses close for three-week summer vacation (July 29 to August 19). Suppliers trying to hold prices firm, hoping demand will improve after the break. Dossiers slow, but 0.30 to 0.50 ct., E-G, VVS goods moving well. Rough-market sentiment weak amid concerns of financial distress. Low rough supply during De Beers sight week.

Israel: Trading sluggish amid weak global demand. US orders supporting the market, whereas Far East remains quiet. Dealers looking for opportunities in niche items. Difficult to source the right commercial goods. Tight profit margins on available stock. Steady demand for 1 to 1.99 ct., G-H, VS-SI, RapSpec A3+ diamonds. Rough trading slow.

India: Trade cautious amid tight liquidity and diminishing credit. Some overseas buyers in Mumbai looking for bargains from companies that need to boost cash flow. 0.30 to 0.49 ct. selling well in parcels after suppliers stopped certifying SI goods. Manufacturing down by estimated 25% to 30% compared to a year ago. Improvement in cheap melee suggests some resistance to CVD.

Hong Kong: Wholesale and retail sectors continue to struggle as ongoing political protests deter foreign traders and tourist shoppers. Chinese market also cautious due to trade war. Other Asian markets such as Indonesia, Thailand and Vietnam stable. Dealers avoiding large-volume purchases as polished prices continue to soften. Steady demand for 0.30 to 0.50 ct. and 1 ct. H-J, VS-SI dossiers.

Financial Data
Metals
Gold 1,418.73 +0.31%

Silver 16.38 -0.19%

Platinum 867.42 +0.03%

Palladium 1,533.30 +0.17%

Currencies
Euro $1.11 -0.20%

Pound $1.23 -1.02%

Yuan($) 6.89 +0.29%

Rupee($) 68.85 -0.44%

Indices
S&P 500 2,901.52 +0.01%

FTSE 100 7,432.42 -1.11%

Hang Seng 27,906.59 -0.91%

Shanghai 2,725.25 -0.46%

Sensex 38,645.07 -0.12%

Stocks
Tiffany & Co. $93.27 -0.34%

Signet Jewelers $17.47 -3.11%

Chow Tai Fook HKD 7.63 +1.19%

LVMH €385.60 +2.51%

Petra Diamonds GBX 9.81 -10.16%