Diamond markets were quiet in October with wholesale businesses closing for the respective Chinese, Jewish and Indian holidays.
The latest RapNet Diamond Index (RAPI) from the Rapaport Group also found trading slowed as larger US holiday orders were already filled and dealers shifted to accommodate specific requirements from their retail customers.
The price for 1-carat polished diamonds fell 2.3% during the month, while 0.50-carat and 3-carat diamonds fell 1.6% and 1.2%, respectively. The price of 0.30-carat diamonds dropped 0.5%.
Market sentiment improved after the September Hong Kong show but polished trading remained sluggish and inventory levels relatively high. Rough demand softened as rough prices firmed in October and Indian diamond manufacturers scaled down operations before closing for Diwali.
While rough demand slowed in October, mining companies continue to register strong growth compared with 2015 when demand slumped due to low manufacturing profitability and high polished inventory.
The report said the industry’s focus shifted to retail as Diwali, Christmas and the Chinese New Year provide important jewellery selling opportunities in the major consumer markets.
However, it said holiday jewellery sales are unlikely to stimulate a “sustainable rise” in diamond trading and polished prices are expected to remain under pressure for the rest of 2016 and into 2017, which should cause rough prices to soften in the long term.