With the number of diamonds on RapNet declining by 3.3% in September to 1.45 million, buyers from mainland China are said to be cautious, as the US-China trade war, depreciation of the yuan, and higher gold prices have diminished their spending power.
It also said that manufacturers have drastically reduced their production of polished diamonds after starting the year with an oversupply, as jewellers in the US are limiting their inventory purchases as the “shift to interactive digital shopping and omni-channel reduces their in-store stock requirements”.
In addition it revealed that rough purchases have slumped, with De Beers maintaining steady prices but introducing a flexible buyback policy in August-September. De Beers sales fell 48% year on year to $537m (£435m) in the third quarter.
Indian manufacturers are said to be keeping their operations at a lower capacity in comparison to previous months due to the three-week Diwali festival break, beginning on October 27, with some small-scale operations closing early due to the weak market conditions.
With the decrease, fashion jewellery was found to be at its peak, overtaking bridal jewellery, which Rapaport said “highlights the need for a “strong investment” in marketing engagement rings this Christmas period.