Diamond market overview
There were reports that many cutting factories closed earlier ahead of India’s Diwali holiday due to the difficult market conditions. While retail demand in the main US market is reportedly steady, and demand in China is said to be picking up, the midstream is facing headwinds from excess polished inventory putting pressure on prices. Meanwhile, the main polishedprices index ended the week virtually unchanged in thin trading volumes, opening at 116.14 on Friday, from Monday’s opening at 116.34.
Highlighting the weakness in rough, De Beers reduced sales volumes at its October sight, selling $370 million, compared to $507 million at last month’s sight. In October 2016, De Beers sold $494 million. The leading rough supplier said the reduction reflected “the concurrent timing this year of the Sight sale with the closure of polishing factories in India and Israel for the observance of religious holidays. Sales were in line with expectations, at what is a seasonally slower time for rough diamond demand.” In the trade however, traders have attributed the slowdown in rough demand to shrinking profit margins, in particular in the manufacturing sector. Alrosa reported a decline in sales in September, which it attributed to “lower activity in the market, particularly caused by the early beginning of Diwali festival in India thus year.”
Corporate and events
Come Monday and the world’s largest diamond cutting and polishing centre will wear a deserted look with shut down of diamond units for a month-long Diwali vacation, The Times of India reported. If the industry leaders are to be believed, around 20 per cent of small and medium units have already downed their shutters in the last two days. Most of the diamond workers have started moving out of the city to celebrate Diwali festival with their friends and families in their hometowns in Saurashtra, said The Times of India report. Sources said the glitter of Diwali festival is missing from the diamond industry, The Times of India report said.
The Kimberley is believed to be home to the world’s largest deposits of rare, yellow diamonds and some of the biggest mining companies have tried and failed to profit from them, abc.net.au reported. Now a Perth-based company is about to have another go and thinks there may be a ”bonanza of hidden diamonds” waiting to be extracted and sold on the world’s diamond markets, the abc.net.au report said. The company is convinced it has what it takes to get at the “fantastic stones” known as fancy yellows which are coveted by wealthy dealers and buyers, said the abc.net.au report.