Diamond prices declined in October as inventories rose in categories that had seen strong gains earlier this year, according to Rapaport Group. The Rapaport Trade Diamond Index (RAPI™), which tracks asking prices for round, D-H, IF-VS2 goods, fell 5.5% for 0.30-carat diamonds and 2.3% for 0.50-carat goods after peaking in late September. The 1-carat index dropped 0.9%, and the 3-carat index rose 0.9%. The 0.30-carat index is still up 8.8% for the year to date.
The number of 0.30-carat rounds in RAPI qualities on Rapaport Trade grew 165% between 1st June and 1st November. There were similar but less-sharp trends in 0.40-ct to 0.99-ct rounds. Prices for these ranges came under pressure as inventory rose.
Rapaport attributed the supply increase partly to manufacturers raising production in response to the market recovery between April and September. Another factor may have been the return of certification activity among cutters who had previously avoided obtaining grading reports for 0.30-carat stones when prices were lower.
Demand for 1-carat diamonds remained stable to soft, while goods of 2 carats and above held steady. Price declines in oval diamonds also eased as available supply tightened.
Rough demand slowed as Indian factories prepared to close for 15 to 30 days over the Diwali festival, which occurs on 8th November. Sales at De Beers’ October sight were low as a result, and because sightholders had brought purchases forward when the miner reduced prices in July. The pause will enable manufacturers to rebalance their stocks, Rapaport explained.
Meanwhile, the industry focused on the impending sale of Anglo American’s 85% stake in De Beers, with Signet Jewelers and Richemont in talks to join former De Beers CEO Gareth Penny’s consortium to bid on the company. Observers expect a deal announcement in the coming weeks.
Luxury jewellery brands continued to outpace the diamond trade, with LVMH and Kering reporting strong third-quarter figures for their jewellery segments. The attention now turns to the Thanksgiving weekend and the holiday season.