Market Overview

Rapaport Press Release: Diamond Prices Stable Through Vegas Show Season

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Diamond prices were stable in May as businesses focused on the Las Vegas
shows that began on May 30. The JCK fair was relatively slow, with fewer
retail buyers attending. Steady dealer demand supported polished price
levels.

The RapNet Diamond Index (RAPI) for 1-carat diamonds slid
0.2% in May. RAPI for 0.30-carat goods dropped by the same margin, while
0.50-carat stones rose 0.2%. RAPI for 3-carat diamonds increased 0.7%
during the month.

RAPI for 1-carat increased 2.5% in the first five months of the year,
but was down 1.2% from a year earlier.

 

RapNet Diamond Index (RAPI)

   

May

 

Jan. - May

 

Y2Y
Jun. 1, 2017 - Jun. 1, 2018

RAPI 0.30 ct.   -0.2%   6.5%   1.1%
RAPI 0.50 ct. 0.2% 5.8% -6.4%

RAPI 1 ct.

-0.2%

2.5%

-1.2%

RAPI 3 ct.   0.7%   0.5%   0.7%

© Copyright 2018, Rapaport USA Inc.

 

The Las Vegas shows highlighted significant challenges facing the
diamond industry amid De Beers' mainstream embrace of synthetics, and
the use of blockchain technology to verify sourcing.

Smaller businesses are under pressure as they face competition from
major diamond companies developing exclusive rough-to-retail channels.
De Beers' entry into synthetics will undercut the existing lab-grown
sector, but also compete with low-cost natural-diamond fashion jewelry.

Sales are up in 2018, but midstream profit margins are being squeezed by
higher rough prices and reduced retail-inventory buying. Strong demand
during the first quarter has led to a slowdown during May and June, as
retailers have sufficient stock for now. Jewelers are looking to fill
immediate orders and require less inventory due to increased interest in
customized pieces and greater reliance on memo goods.

Dealer inventory levels have consequently gone up, and the number of
unique diamonds listed on RapNet has risen 10% since the beginning of
the year to 1.3 million stones valued at $7.7 billion on June 1.
Retailers are expected to start placing orders again in the third
quarter as they prepare for the holiday season, and suppliers must offer
a strong follow-up to the Las Vegas shows to take advantage of the
prevailing positive sentiment.

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