The closure of eastern markets due to the coronavirus outbreak has caused great uncertainty across the global diamond trade, The Diamond loupe reported.
Despite the optimistic month of January, the warning signs appeared in the market already by the end of the month.
The agency said that according to figures published by the Antwerp World Diamond Centre (AWDC), hardest hit in Antwerp was in the category polished-diamond exports, the year-over-year value of which was halved due to the postponement of the Hong Kong International Diamond, Gem & Pearl Show and the Hong Kong International Jewellery Show, which are the key selling events at the beginning of the year. However, this year the stocks of diamonds were not sold, as trade with Hong Kong – Antwerp’s second largest market for polished goods – fell by nearly 94%.
Nevertheless, without HK fairs polished exports only fell by a modest 7% compared to last month, to $560 million from $605 million.
The U.S. and European markets remained cautious, but exports to Israel increased by more than 62% to nearly $86 million.
Image credit: gr8effect (Pixabay)
Polished-diamond imports declined by 4% with fewer carats being traded, the value of which declined by 11% as prices fell.
The major diamond indexes showed a decline, with PolishedPrices saying its diamond index had slumped to a ten-year low at the close of the month.
Antwerp’s rough-diamond trade in February reflected accurately the trends shaping 2020 thus far.
ALROSA’s and De Beers’s strong sales in January led to a 43% increase in rough imports to Antwerp in January, carrying over to a 19% percent increase in February. Over 8 million carats were imported to Antwerp last month, the value of which rose to $683 million – a 10% increase over February 2019. During the first two months of 2020, Antwerp’s rough imports have risen 30% in volume, yet low average prices have only led to a 12% gain in value.
Meanwhile, following the increase of goods on the market due to the miners' January sales, rough-diamond exports from Antwerp in February increased by 1.4 million carats compared to January, totaling more than 9 million carats, yet this was still 8% less than in the same month a year ago. Declining prices pushed the value of those exports down 16%. During the first two months of the year, Antwerp’s exports of rough goods have fallen 7% to 16.7 million carats, while their value has declined 12% to $1.4 billion.
However, the trade still expresses concern about the impact the new coronavirus may have on the industry- rough purchases from the majors may be postponed and there may be a slowdown in manufacturing in India as consumer sentiment has crashed in China and may follow elsewhere. Others expect the demand for polished goods in China will rise again when the coronavirus calms down, as consumer jewelry demand remains strong despite challenging external circumstances, the Diamond loupe noted.
Alex Shishlo, Editor of the Rough&Polished European Bureau in Brussels
