Latest reports from Rappaport shows that the diamond market experienced subdued trading in August due to seasonal trends and uncertainties surrounding consumer demand.
Prices of polished diamonds continued to decline, following a similar trend seen in previous months.
Price Declines and Competition from Synthetics
In the United States, retail sales presented a mixed picture, with competition from synthetic diamonds and economic challenges affecting demand.
Retailers and dealers were selective in their purchasing decisions, while demand in China remained weak.
According to the RapNet Diamond Index (RAPI™), prices for 1-carat round, D to H, IF to VS2 diamonds fell by 1.1% in August. Other sizes also saw decreases, with 0.30-carat stones dropping by 2.7%, 0.50-carat diamonds declining by 0.7%, and 3-carat diamonds falling by 0.9%.
Revision of RAPI and Market Impact
The price declines in August were less steep than in July, partly due to a revision in the RAPI calculation. On August 21, diamond listings from Chinese sellers were removed from RapNet due to low listing prices and additional fees for currency conversion. This adjustment led to a technical rise of 1.3 percentage points on average across the four sizes listed in the RAPI table.
Additionally, Rapaport adjusted prices on its Rapaport Price List on August 30 to reflect the continued decline in market asking prices.
Factory Closures and Supply Chain Adjustments
Indian diamond manufacturing was impacted by extended public holidays in August, which could delay the replenishment of inventories. As of September 1, the number of diamonds listed on RapNet had increased by 4% since the beginning of July, reaching 1.74 million stones. In response to lower demand, major diamond producers, including De Beers and Petra Diamonds, postponed rough diamond sales, reflecting the industry’s efforts to manage supply.
Key Trade Shows and G7 Restrictions
The India International Jewellery Show (IIJS) saw strong domestic demand for gold and jewellery, but expectations for the September Jewellery & Gem World show in Hong Kong remain low, given the ongoing weakness in Chinese demand for natural diamonds.
Furthermore, as of September 1, the Group of Seven (G7) expanded restrictions on the import of diamonds from Russia, affecting goods of 0.50 carats and larger. In line with these sanctions, the United States followed the European Union by exempting “grandfathered” diamonds that were outside of Russia before the March 1 sanctions, and for 0.50- to 1-carat diamonds, those already present outside of Russia before the September 1 enforcement.
