Certified 1ct. Polished Diamond Prices +0.3% in February

Diamond market sentiment improved in February as polished diamond prices rose while rough diamond prices remained stable. Polished trading was driven by U.S. and Chinese demand as jewelers began to replenish inventory sold during the Christmas and Chinese New Year shopping seasons. As a result, polished dealers have high expectations for the Hong Kong show, which began on March 3, Rapaport reported.
In February, the RapNet Diamond Index (RAPI™) for 1-carat certified polished diamonds increased 0.3 percent, while RAPI for smaller diamonds continued the positive trend that was evident in 2013. There is strong demand for 0.30-carat to 0.50-carat, GIA dossiers with large inventory building up at the Gemological Institute of America (GIA) due to delays.
The Rapaport Monthly Report – March 2014, ''Rising Confidence,'' noted enhanced confidence among diamond manufacturers as polished prices have firmed and profit margins improved. There was greater liquidity in the market as manufacturers’ inventories declined. However, concerns remain that liquidity will tighten in the coming months since trading is expected to slow in the second half of the year and banks are reducing their credit to the industry.
Improved liquidity helped boost rough trading at the start of 2014 and demand remained strong in February. De Beers kept prices stable at its February sight and boxes continued to garner steady premiums in the secondary market. There is particularly good demand for rough that yields polished below 1-carat and for SI and lower clarity diamonds.
Diamond markets are optimistic but all eyes are on this week’s Hong Kong show to assess whether the positive trend will be sustainable. The show is expected to reflect selective Far East demand with price sensitive buyers. Polished suppliers are clamoring for higher prices but buyers are resisting as retail jewelry demand is steady but not booming.