India may impose embargo on diamond imports for 1-3 months

(FINMARKET.RU) - India may impose an embargo on the import of rough diamonds for a period of 1 to 3 months after the expiration of the national lockdown on May 3, said industry website The Diamond Loupe citing unofficial sources.
However, there is no official confirmation of this information yet.
India accounts for about 90% of global production of polished goods; the country is the largest actual importer of rough diamonds. India’s annual diamond imports reach about $ 14 billion.
Indian traders in favor of the embargo hope that this measure will stop the fall in diamond prices and improve the financial situation in the industry.
India introduced a similar embargo during the crisis of 2009, and the ban lasted 30 days. It followed a period when rough prices, due to speculation, reached unreasonably high levels resulting in large diamond inventories that were difficult to sell.
The shutdown of the diamond manufacturing industry in India due to the quarantine introduced at the end of March complicated the sale of rough diamonds, the demand for which fell sharply due to the closure of jewelry retail in the United States and most of the EU countries, as well as the downturn in the global economy caused by the coronavirus.
According to Bain, global sales of luxury goods in the 1st quarter will be reduced by 25-30%, and in 2020 they may fall by a quarter compared to last year. De Beers canceled its third sales cycle this year due to antiviral restrictions; ALROSA’s result was two times lower than in February and the company broke off contracts with some customers due to non-compliance with the conditions. Small diamond miners, such as Petra Diamonds, which sell their rough at tenders, faced a sharp deterioration in market conditions in March. Petra reported a 24% drop in prices in March prompting the company to suspend trading and stockpile rough until better times.