Diamond markets were mixed in April, according to a press release by Rapaport group. A robust recovery in the US and China drove optimism, but sentiment weakened due to the spike in Covid-19 cases in India. Surat-based manufacturers reduced capacity as infection rates rose. Grading labs experienced a backlog because of operating restrictions, it noted.
Lower inventory levels supported polished prices. The RapNet Diamond Index (RAPI™) for 1-carat diamonds increased 2.5% during April and was up 4.2% from 1st January.
RapNet Diamond Index (RAPI™)
| April | Year to date Jan. 1 to May 1 | Year on year May 1, 2020, to May 1 2021 | |
| RAPI 0.30 ct. | 0.1% | -0.3% | 6.2% |
| RAPI 0.50 ct. | -0.2% | -2.5% | 15.6% |
| RAPI 1 ct. | 2.5% | 4.2% | 18.3% |
| RAPI 3 ct. | 2.5% | 2.9% | 9.9% |
Rapaport noted that diamond manufacturing in India fell an estimated 30% to 40% following the second coronavirus wave in mid-March. The Gemological Institute of America (GIA) extended its grading time to over a month at its Mumbai and Surat labs.
The number of 1-carat, D to H, IF to VS2 diamonds on RapNet has fallen 7% since 1st March. The volume of goods in that category is still 36% higher than at the beginning of the year, signaling that there is sufficient supply to satisfy short-term demand. Polished inventory rose after a strong period of rough buying between November and March. India’s rough imports grew 44% year on year to $4.12 billion during the first quarter but declined in April due to the lockdowns, according to estimates.
Supply volatility is likely in the short term and may impact polished-diamond prices, Rapaport said. More goods will become available once the GIA reduces its backlog, but fewer goods will be entering the market afterward due to the current drop in manufacturing, it stated. That should bolster prices when demand picks up for the holiday season, Rapaport indicated. The outlook for retail is positive. US jewellers are seeing strong sales amid successful vaccination programmes. Companies with strong multi-channel strategies can capitalise on continued e-commerce momentum as well as consumers’ desire to get out and shop in stores again.