Record inventory buildup of 0.30 to 0.50 ct. goods

The diamond market was relatively quiet in September as various Jewish and Indian festivals disrupted activity. Dealers remained optimistic for the US holiday season after positive trading at the Las Vegas shows in late August. China’s economic slowdown brought some caution into the market.

Polished prices softened for goods below 1 carat but firmed for diamonds above 1.50 carats. The RapNet Diamond Index (RAPI^™) for 1-carat diamonds slid 0.5% during September.

Categories below 1 carat weakened as inventory levels increased. A record volume of 0.30- to 0.50-carat diamonds is currently available. Total listings for all sizes on RapNet exceeded 1.7 million unique stones on October 1, up 5% from September 1 and 43% from a year earlier.

Diamond manufacturers have gradually raised capacity following strong rough buying in the first half of the year. High polished output is anticipated in the coming month; suppliers are filling US holiday orders before factories close for the two-week Diwali break beginning November 4.

A lot of goods remain in the pipeline. The Gemological Institute of America (GIA) continues to report a six-week backlog at its Mumbai lab. Rough demand was robust during the De Beers sight that took place from October 4 to 8, and prices were stable. Rough supply is low relative to prevailing demand. Cutters are concerned about profit margins, particularly for rough that yields polished below 1 carat.

Steady US orders are supporting the market. Consumer confidence has dipped slightly as Covid-19 relief money has dried up and due to concerns about inflation and labor shortages. However, jewelers are enjoying a banner year. They have positive expectations for the holiday season, especially since engagement-ring sales typically peak in November to December. There is pent-up demand for weddings after the postponements that resulted from the pandemic, as noted in the October bridal issue of Rapaport Magazine.

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