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Rapaport TradeWire April 6, 2017
Apr 6, 2017 6:00 PM
By Rapaport
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Rapaport Weekly Market Comment
April 6, 2017
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Positive mood but market cooling ahead of Passover and Easter break. First quarter
weaker than previous years with cautious retail inventory replacement. 1 ct.
RAPI -1.1% in 1Q, +0.1% in March. Good demand for 0.30 to 0.49 ct. diamonds.
Rough market hot with 3% to 10% dealer premiums after De Beers $580M sight
exceeds expectations. Sotheby’s Hong Kong sells 59.60 ct., fancy vivid pink, IF
diamond to Chow Tai Fook for record $71.2M ($1.2M/ct.). Belgium March polished
exports +0.4% to $1.2B, rough imports +2% to $1.1B. Israel bourse to appoint
judge to handle high-value arbitration. THE RAPAPORT PRICE LIST WILL NOT BE
PUBLISHED ON APRIL 14 DUE TO THE JEWISH HOLIDAY OF PASSOVER.
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| Diamonds |
1,243,452 |
| Value |
$7,638,971,461 |
| Carats |
1,353,058 |
| Average Discount |
-29.96% |
www.rapnet.com
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| The RapNet Diamond Index (RAPI™) is the average asking price in hundred $/ct. of the 10 percent best priced diamonds, for each of the top 25 quality round diamonds (D-H, IF-VS2, GIA-graded, RapSpec-A3 and better) offered for sale on RapNet - Rapaport Diamond Trading Network. |
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Get Current Price List | Subscribe to Rapaport | Join RapNet |
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QUOTE OF THE WEEK
Diamonds have value worldwide, so it comes as no surprise that an alleged organized ring would target diamond wholesalers in Manhattan's diamond district in a worldwide scheme.
Acting Manhattan US attorney Joon Kim after police arrest 10 people accused of involvement in a $9M fraud scheme.
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MARKETS
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United
States: Rising consumer confidence lifting trade sentiment. Independent jewelers
that are investing in social media marketing and innovation and adapting to
changing consumer needs are doing well…
Belgium: Polished market steady with good demand for 0.30 to 0.49 ct., F-I, VS-SI, RapSpec
A2 (3X) diamonds. Commercial-quality, J to L colors also moving well…
Israel:
Trading quiet but stable. Many businesses closing for next week’s Passover
holiday. Dealers trying to innovate but struggling to break stagnant trading
patterns…
India: Steady polished trading driven by consistent Chinese demand. Local dealer
demand improving with start of the new financial year in April…
Hong
Kong: Positive sentiment but dealer activity has slowed following the Chinese New
Year season and due to the public holiday this week…
Click here for deeper analysis |
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RAPAPORT STATEMENT
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Diamond Market Improves After Cautious 1Q
Diamond trading improved in
March, with better-than-expected Chinese demand at the Hong Kong show.
Suppliers were willing to compromise on price in order to generate liquidity
before new, better-quality polished production becomes available.The
RapNet Diamond Index (RAPI™) for 1-carat polished diamonds edged up 0.1% in
March and was down 1.1% during the first quarter.
Click here for the full statement |
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INSIGHTS
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Diamond Trade Banking on Relationships
The recent diamond financing seminar in Mumbai
highlighted the gulf that exists between the trade and its lenders but also a
willingness to engage with one another...
Click here to continue reading
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INDUSTRY
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Pink Diamond Smashes Records with $71M Sale
Chow Tai Fook bought the Pink
Star diamond for $71.2 million, or $1.2 million per carat, at Sotheby’s Hong
Kong, making it the most valuable diamond ever sold at auction. The oval,
mixed-cut, 59.60-carat, fancy vivid pink, internally flawless diamond originated
from a 132.50-carat rough extracted by De Beers in 1999, and cut and polished
by Steinmetz Diamonds. The stone was renamed the ‘CTF Pink’ in honor of the
buyer’s founder and to mark the jeweler’s 88th anniversary. |
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De Beers Sees Strong Demand at $580M Sight
De Beers garnered sales of
$580 million in March amid positive sentiment in the rough diamond market.That
saw the company’s sales rise 2% to $1.86 billion over the first three sights of
the year, according to Rapaport records, as rough demand improved following a
liquidity crunch in India at the end of 2016. Sightholders reported strong demand for
De Beers goods on the secondary market during the sight which ended March 31,
with boxes selling at 3% to 10% premiums.
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Judge to Head Israel Bourse Arbitration Unit
The Israel Diamond Exchange
(IDE) will appoint a judge to decide major disputes between its members,
marking a break from its 80-year tradition of settling matters within the
trade.The
appointee will head the IDE’s Arbitration Institution in lieu of a bourse
member, dealing with financial disputes between members valued at $400,000 and
above, as well as appeals on smaller disagreements. IDE members will continue
to deal with initial arbitration for matters below $400,000.
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Gang of Diamond Fraudsters Arrested
New York police arrested 10 men accused of defrauding
wholesalers out of diamonds worth more than $9 million. The accused wrote bad
checks, forged documents and devised long stories to cheat their victims in New
York, Las Vegas and Mumbai, the US Attorney’s Office for the Southern District
of New York reported. Police are still looking for two more men charged in the
scheme. The group focused on obtaining small melee diamonds, building up credit
and trust with the diamond supplier before walking away with millions of
dollars in diamonds at the moment of maximum credit, the complaint explained.
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RETAIL & WHOLESALE
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Signet Says Shareholder Suit Lacks Merit
Signet Jewelers dismissed a
lawsuit that claims it misled the public about an arbitration case in which
allegations of sexual harassment surfaced. The suit was filed by Irving
Firemen’s Relief & Retirement System, an institutional investor in Signet,
alleging the company violated federal securities laws by disseminating false or
misleading statements about the true nature of the allegations.The
suit says shareholders suffered damages when Signet’s shares fell 13% last
month as claims of sexual harassment at Signet surfaced in a report by The
Washington Post. Signet said the lawsuit was “without
merit.”
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NRF Predicts Cracking Good Easter
Easter retail sales are
projected to rise 6% to $18.4 billion this year, according to the National
Retail Federation (NRF), as the holiday’s relatively late date means consumers
will have longer to shop. The improving economy means consumers are in the mood
to shop and retailers are ready to entice them with deals, the NRF
added. US consumer confidence improved 8% in March from the previous month, hitting its highest level since December 2000, the Conference Board said.
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Titan Optimistic Amid Indian Economic Reforms
Titan Company projected sales
will increase by more than 10% this year, underpinned by government measures to
formalize the Indian economy. The jeweler expects to build on exceptional
growth in the last fiscal year that ended March 31, which came despite a
nationwide jewelers' strike and demonetization which squeezed consumer
liquidity. Retail sales grew more than 40% at its flagship Tanishq stores
during the fourth fiscal quarter, the company reported.
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Signet, DPA Setting Synthetics Detection Criteria
Signet Jewelers is working
with the Diamond Producers Association (DPA) and product-testing firm UL to
establish quality criteria for equipment that detects synthetics, the jeweler
said. The project with UL, formerly Underwriters Laboratories – and not United
Laboratories as previously reported by Rapaport News – aims to establish
criteria for identifying screening equipment for lab-grown diamonds. That's in
addition to the machines currently available from HRD Antwerp, the Gemological
Institute of America (GIA) and De Beers' International
Institute of Diamond Grading & Research (IIDGR). Signet is not opening a
testing laboratory, contrary to the original Rapaport News report.
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MINING
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Dominion Sees More Life in Diavik Mine
Dominion Diamond Corporation
has extended the life span of its jointly owned Diavik mine by two years to
2025. The
company, which is currently soliciting bids to be acquired, expects output
of 46 million carats for the remainder of the operation, up 16% from its
previous estimate. Its revenue forecast subsequently rose 22% to $6.77 billion. Dominion
owns 40% of Diavik, with Rio Tinto owning the rest.
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Alrosa’s Asian Sales Gain Momentum
Alrosa raised $12.9 million
from a rough-diamond auction at its new Eurasian Diamond Centre in Vladivostok.
The miner sold 21,000 carats of gem-quality rough for $8 million, at an average
price of $380 per carat, with the remaining $4.9 million of sales coming from
440,000 carats of industrial-grade diamonds. The main buyers were Indian and
Chinese, but the sale also attracted bidders from South Korea, Europe and
Russia, the company said. |
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Large Yellow Diamond Confirms Liqhobong Potential
Firestone Diamonds has
extracted a 110-carat, light-yellow diamond, which it says is the largest
discovery to date at its Liqhobong mine in Lesotho. The rough
diamond surfaced during the ramp-up phase of the mine, where production began
in October. The mine previously yielded 20 stones larger than
10.8 carats, including a 37-carat diamond. The new diamond’s discovery “confirms
our long-held belief that Liqhobong has large-stone potential,” said Firestone
CEO Stuart Brown.
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DiamondCorp Sends Staff Home
DiamondCorp retrenched all
employees effective April 3 after talks with its lender and a mining union failed.
Negotiations with the rescue practitioner for DiamondCorp’s subsidiary Lace
Diamond Mine, to commence care and maintenance at the mine, were terminated
without a settlement being reached. DiamondCorp warned that the group will need
to be placed in administration if an “accelerated” funding plan cannot be
completed by mid-May 2017.
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GENERAL
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GIA Launches Gem Guide for Artisanal Miners
The Gemological Institute of
America (GIA) is piloting a free gemology guide for artisanal miners in
producing countries. The aim is to offer basic gemological and market knowledge
in regions where gem-mining takes place, the institute explained. The GIA has
distributed the illustrated booklet – available in English and Tanzanian
Swahili – to approximately 45 women miners in Tanzania’s Tanga region.The
project was carried out in partnership with international development
organization Pact at a cost $120,000, paid from the GIA’s endowment fund.
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London Bourse Recruits Ethics Adviser
The London Diamond Bourse
(LDB) has appointed Katherine Chappell, a longstanding member and specialist in
fair-trade principles, as its special adviser for ethical issues. This
means LDB can enhance its conversations around responsible sourcing and engage
in a more relevant dialogue, and at the same time strengthen the bourse’s
understanding of specialist issues, explained Victoria McKay, the LDB’s chief
operating officer.
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JBT Backs Chairman for Second Term
The Jewelers Board of Trade
(JBT) has reelected Todd Wolleman, of New York-based colored-stone specialist
Leo Wolleman, as chairman for another year. Michael Kaplan of New York’s Rocket
Jewelry Box will remain first vice chairman, while Ann Arnold of Arnold
Advisory Group in Norwood, New Jersey, will stay on as second vice chairman.
Anthony Capuano, meanwhile, continues to serve as president and treasurer. Brenda
Pimentel has been reelected as secretary.
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Baselworld to Be Two Days Shorter
Organizers of the Baselworld
watch and jewelry exhibition have reduced the 2018 edition by two days after
fewer buyers and exhibitors attended this year's show. A
total of 106,000 buyers took part in the event, down 4% from the previous year,
while the number of exhibitors reportedly fell 13% to 1,300. Baselworld
said it was responding to exhibitor feedback by limiting the show to six days
instead of the traditional eight. Baselworld 2018 will run from March 22 to 27.
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ECONWATCH
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Diamond Industry Stock Report
Firestone Diamonds (+17%) led mining stocks after the rough producer discovered the largest diamond to date at its Liqhobong mine. In the U.S., retail stocks had a disappointing week amid continued reports of store closures and poor first-quarter figures. Far East stocks climbed, with the gains headed by Chow Tai Fook (+5.4%) in a week that saw the Hong Kong-based retailer buy the most expensive diamond in history.
View the detailed industry stock report
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Apr 6, 2017 (12:58 GMT) |
Mar 30, 2017 (12:22 GMT) |
Chng. |
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| $1 = Euro |
0.94 |
0.93 |
0.01 |
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| $1 = Rupee |
64.55 |
64.90 |
-0.35 |
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| $1 = Israel Shekel |
3.64 |
3.62 |
0.02 |
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| $1 = Rand |
13.84 |
12.86 |
0.98 |
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| $1 = Canadian Dollar |
1.34 |
1.33 |
0.01 |
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| Precious Metals |
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Chng. |
| Gold |
$1,253.12 |
$1,250.40 |
$2.72 |
0.2% |
| Platinum |
$954.75 |
$957.71 |
-$2.96 |
-0.3% |
| Silver |
$18.23 |
$18.17 |
$0.06 |
0.3% |
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| Stock Indexes |
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Chng. |
| BSE |
29,927.34 |
29,647.42 |
279.92 |
0.9% |
| Dow Jones |
20,648.15 |
20,659.32 |
-11.17 |
-0.1% |
| FTSE |
7,304.24 |
7,354.17 |
-49.93 |
-0.7% |
| Hang Seng |
24,273.72 |
24,301.09 |
-27.37 |
-0.1% |
| S&P 500 |
2,352.95 |
2,361.13 |
-8.18 |
-0.3% |
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INDIA MARKET REPORT
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Polished Trading Activity
Steady polished trading driven by consistent Chinese demand. Local dealer
demand improving with start of the new financial year in April. Fewer overseas
buyers in the market due to upcoming Passover and Easter holidays. Some concern
about weak US orders, with dealers emphasizing June Las Vegas show as important
market gauge. Rough trading strong as large manufacturers continue to increase
polished production.
Read the Polished Diamond Trading Report |
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