Dear Friends,
Summer is upon us, and as we contemplate our annual holidays, we are in the midst of a slow business season. There is always a seasonal slowdown over the summer, but the situation for most of us in the diamond industry is problematic for additional reasons. Demand in the US is fairly weak and the situation in China and the rest of Asia is even worse.
We’ve heard from some of our US bourses that there had been a slight boost in demand within the past few weeks, much of it due to the wedding season. However, when the RAP list lowered natural diamond prices across the board, business dropped sharply. We are told that the list is supposed to reflect the diamond market, but in reality, it is influencing the market. We are hopeful that beginning in September and on to the Christmas season the natural diamond market will improve.
As we mentioned, the Chinese diamond market has not recovered. Thankfully, De Beers, Chow Tai Fook and the Chinese government, through the Shanghai bourse, is going to be spending considerable sums of money to promote natural diamonds in China. We believe that these marketing campaigns will result in an important boost for the Chinese diamond market.
Thankfully De Beers seems to be keeping in tune with the market, lowering the amount of rough that it is making available. The last sight was smaller, and the next sight will smaller still, a good sign for manufacturers and rough traders.
The industry is waiting for answers to several important open questions. How will the G7 Russian sanctions finally play out? The EU has pushed the date of the beginning of traceability from September 2024 to March 2025. We don’t yet know what the US, UK and others will decide but it seems clear that the single node model will not work.
We are also waiting to see if De Beers will be sold, and to whom, and how that will impact the diamond industry.
In the meantime, let’s all think positively and enjoy our summer holidays.
Warm regards,
Yoram Dvash
