Colored diamond prices have increased in 2021
PRICES for fancy colored diamonds rose in 2021 as the market recovered from the previous year’s pandemic-induced slump, but their supply is shrinking somewhat.
That’s according to the Fancy Color Research Foundation (FCRF), which tracks the price of gemstones in Hong Kong, New York, Geneva and Tel Aviv, where demand is above average.
According to the foundation’s 2021 analysis, the steady rise in the Fancy Color Diamond Index is further evidence of the stability of this luxury category,” FCRF advisory board member Ephraim Zion said last week.
“We are seeing more people buying these beautiful natural diamonds as their supply decreases,” he said.
The average price of all fancy colored diamonds ended the year up 1.7% from 12 months earlier, with the index recording price increases in 89% of all categories, FCRF noted. .
Prices for blues jumped 2.2% on the year, while pinks climbed 2%. Yolk prices edged up 0.9%.
Despite these price increases, diamond sales continue to increase. This is mainly due to the continued recovery of the global crude market.
The diamond industry has started the year in good spirits after strong holiday jewelry sales and strong overall growth in 2021.
This optimism was tempered towards the end of the month by sharp price increases, the Omicron variant of Covid-19, market volatility and geopolitical tensions.
According to the RapNet Diamond Index, the price of 1-carat cut diamonds rose 6.9% in January and 26.3% year-on-year earlier this month.
There were also shortages in the polished market.
Manufacturers were still operating at around 75% capacity due to Covid-19 measures and because many workers had not returned from earlier coronavirus shutdowns.
The shift to cutting higher value certified products during the early stages of the pandemic led to a significant increase in prices for small and low value polished diamonds from September 2021, as supply dwindled.
Three main factors explain the high polished valuations: supply shortages, good US demand and high rough prices. Manufacturers are keeping prices firm as their rough costs rise.
For now, it is easier to sell than to buy.
This could change in the coming months as more merchandise becomes available and dealers become more cautious about their ability to make a profit at these price points.
De Beers reported a sharp rise in rough sales last week to $660 million (tentative) at its first sight of 2022. That’s nearly double its sales at the sight. last December, which only raised $336 million.
The UK-based miner reportedly introduced steep price increases for small commodities in January (up to 20% according to Bloomberg) as consumer demand showed no signs of slowing down.
This adds to a long series of price increases for big goods.
Bruce Cleaver, Group Managing Director of De Beers, said: “As expected, consumer demand for diamond jewelery has increased sharply over the holiday season. As a result, we saw continued robust demand for rough diamonds during the first sales cycle of the year, with buyers focusing on restocking depleted inventory.”