Market Comment

News: Diamond prices falling following De Beers’ sharp reduction of rough prices in many categories and synthetic diamonds’ takeover of commercial-quality real-diamond demand. Brands buying perfect fancy shapes and select large diamonds. Vivid and intense yellows also selling well. Fine-quality diamonds better than commercial goods. Synthetic-diamond prices crashing, with fine-quality synthetics (F-G, VVS-VS) in 2 to 3 ct. selling for $300-$500/ct. De Beers 2Q sales -19% to 7.6M cts., production -5% to 7.6M cts. US consumer spending weak, with revenue growth slowing to 0.2% in June, Census Bureau reports. Asia recovery supporting luxury brands: 1Q sales at Richemont’s jewelry brands +19% to $4B. China gold demand improving, but diamonds slow.

Fancies: Fancy-shape market slower than before but better than rounds. Prices dropping but not as fast as rounds. Longer Ovals, Pears, Radiants and Cushions fetching higher prices than shorter stones. Goods with medium and short ratios weak. Marquises improving. Demand for Cushions declining. 0.30 ct. doing well. Orders low for 0.70 to 1.20 ct. diamonds. VS-SI losing strength, except in 1.20 to 1.49 ct. Well-cut stones seeing supply shortages. Excellent shapes commanding premiums. Retailers offering broader product ranges as consumers seek alternative cuts. Oversizes trading at higher prices than usual. Off-make, poorly cut fancies illiquid and difficult to sell.