February Market Report

(ehudlaniado.com) - Activity in the midstream of the diamond pipeline was mixed in the past month. On one hand, the high level of activity typical in the post-New Year and holiday sales season was not seen as much this year. On the other hand, traders are reporting steady demands and prices, with a few pockets of occasional rise in local demand for polished. The highlight was activity during the Hong Kong trade show, where trading activity was above the levels seen in recent months. Noteworthy was the purchase of Blue Nile by Bain Capital, which creates a sense of uncertainty among some of their vendors. The drop in Signet sales has rattled the market, which was used to seeing the leading US retailer doing well even when most others didn’t. At Tiffany, the poor results led to the immediate dismissal of the CEO, and the appointment of three new directors to the board, representing a key shareholder. On the rough goods side, De Beers hiked prices of rough in January, stretching the price too high, as indicated by the lower prices goods got at tenders that took place in the following weeks. In February, demand for rough recoiled to a certain degree. Polished diamond prices continue to soften, and the Mercury Diamond Global Tracker™ (MDGT) declined 0.07% in January.