The Rapaport Group has reported that its RapNet diamond price index (RAPI) decreased in many categories in August as the US tariffs impacted demand for Indian polished goods.
In August, RAPI for 1-carat diamonds fell 1.1%, while the index for 0.30- and 0.50-carat stones declined 3.8% and 3.9% respectively. Meanwhile, larger stones were more resilient than smaller ones, with the 3-carat RAPI increasing 0.4%.
Tariffs imposed on Indian goods by the US administration were especially severe: from the initial 25%, the duty on Indian-origin products have been elevated to 50% as a retaliation for India buying Russian oil.
The gap in asking prices between US- and India-located inventory on RapNet grew to around 16% in 1-carat commercial goods, from the usual 10% to 12%.
“The levies have shaken up supply chains that developed over many years. Companies have sought low-duty routes and loopholes and relocated inventory to the US,” Rapaport said in a press release.
“The uncertainty has made it hard to plan and invest in long-term solutions.”
At the same time, rough demand weakened as manufacturers reduced production. Indian manufacturing sector, which cuts and polished around 90% of the world’s diamonds, came under threat of significantly squeezed margins and mass layoffs.
Theodor Lisovoy, Managing Editor, Rough&Polished
