Rap list up again.....temporary blip, or the new reality?

[Rockdiamond]

Hi all!
My email this morning contained the new diamond price list- increases across the board on round diamonds between 1.50-2.99cts
What’s your thoughts on this- is it due to so much new activity due to lessening civic restrictions combined with lack of supply due to covid in India in particular.....or are these prices the new reality- here to stay?

 

[missy]

@Rockdiamond interesting. What about larger rounds?

 

[Rockdiamond]

Hi @missy ! I hope you guys are getting a lot of miles in on that tandem!
No changes above 3cts this week. Nor changes on Fancy shapes. But sometimes he tends to stagger....one week rounds, the next week Fancy shapes.

 

[Karl_K]

no clue and I really wonder if anyone knows the answer.

 

[kenny]

"Blip or new reality?" ... You could ask that about any change in the market for anything.
I'd guess supply and demand are pretty reasonable assumptions.

 

[missy]

Hi @missy ! I hope you guys are getting a lot of miles in on that tandem!
No changes above 3cts this week. Nor changes on Fancy shapes. But sometimes he tends to stagger....one week rounds, the next week Fancy shapes.

Hi David! Thanks. And yes we are.

We have a new development I wanted to share with you but was too lazy to start a thread about it plus I don't think most people here would be interested anyway. Greg retrofitted our tandem with a solar panel and a voltage converter which is connected to a battery that powers a pedal assist motor. Greg has the pedal assist though and I do not. But that works for us. He needs another knee replacement. He did one (January 2020) before Covid and needs the other knee replaced but we are waiting. In the meantime this is a fantastic way to go. I love it because we can go faster and it's so much fun. I am not sure he will want to give up the pedal assist even after his surgery. He says it is still a great workout and he doesn't feel it takes anything away from our cycling experience. I feel the same.

Here's a photo of our new solar set up.






How goes your cycling adventures? Are you still cycling to work daily? Are the streets of NYC still relatively quiet? I hope you are enjoying your bike very much.

 

[Rockdiamond]

Greg retrofitted our tandem with a solar panel and a voltage converter which is connected to a battery that powers a pedal assist motor.

That is the coolest thing I’ve seen in a long time!?!!!
Definitely deserves its own thread IMO.
Maybe I’ll start one since you’re too tired because Greg is using all the electric power

 

[Rockdiamond]

"Blip or new reality?" ... You could ask that about any change in the market for anything.
I'd guess supply and demand are pretty reasonable assumptions.

I guess there’s ways that the diamond business is just like any other….but there’s unique aspects too.
Who sets prices for automobiles?
The rap list really does affect what we pay ….except fancy colors.
Maybe that’s a clue.
Fancy Light Yellow as an example.
2ct FLY on May 1 2021= 1
2ct FLY on July 1 2021= 1.5+

Is Rappaport reflecting the changes or spurring them ?

 

[John Pollard]

My 2 cents would be a pandemic-caused supply-demand gap attributable to the same restart-delay that's causing price increases in other sectors.

For example, tree farming was affected much like diamond mining. Both sectors had to adjust their operations, slowing production, resulting in reduced supply. Now there is insufficient transportation to move lumber from the mills to the dealers to keep up with demand. In the same manner, polishing and export of diamonds from India has been plagued by continued stops and restarts while demand increases.

If there was a Rapaport for the lumber industry (Plankaport?) you'd see prices up notably. In that sector I imagine we can expect a return to normal.

Rap reported/created some room for prices to maneuver in March 2020, aka "The short heard round the world." In the interest of fair reporting, and relevant to David's question, the Rap Response may be of interest.

This pandemic supply-demand gap isn't limited to natural resources. After encouraging staff to take early retirement and furloughing almost 20,000 people last October, American Airlines had to cancel 950 flights this month because they don't have enough qualified pilots to fly the planes. And don't get me started on rental car prices.

 

[Modified Brilliant]

I think prices will level out overall once the world has a better understanding of the pandemic's current and future status---still alot of uncertainty.

 

[Rockdiamond]

Unbelievably, I totally agree with Rappaports assessment that John linked to.
Having experienced many spikes and drops in prices over the years I’ve learned it’s an asset to simply value inventory where the market is.
So easy when the stone you paid $10k for has gone up to $12k.
Much more difficult ( for many) when it has gone down to $8k.
My experience with 2ct FLY seems to bear out that Rap is reflecting prices as opposed to affecting them.
Personally I hope diamonds follow the “Plankaport” prices…..
I understand lumber prices have dropped precipitously from their pandemic high levels

 

[Garry H (Cut Nut)]

The simple truth.
Supply dropped as mentioned by others.
Spending went thru the roof as travel and eating out plummeted.
Diamonds are not satiating - like water - the more people own the more they buy.
LGD's (as I bang on and on) are leading to a crash in prospecting because investors will not fund geologists.
Natural diamond prices will continue to soar - from Rapaport:

and from our data base on Pricescope:

 

[Rockdiamond]

The simple truth.
Supply dropped as mentioned by others.
Spending went thru the roof as travel and eating out plummeted.

I can’t argue with the premise you raise Garry. There does seem to be a disconnect when LG diamonds follow the Rap list directly.
But as far as the point I quoted above….
The opposite happened. During the worst of the pandemic in the US, diamond prices softened. Now that people are again, going out and spending money diamond prices are spiking

 

[Garry H (Cut Nut)]

I can’t argue with the premise you raise Garry. There does seem to be a disconnect when LG diamonds follow the Rap list directly.
But as far as the point I quoted above….
The opposite happened. During the worst of the pandemic in the US, diamond prices softened. Now that people are again, going out and spending money diamond prices are spiking

Look at the two charts I posted David - no need to remember - its all there.
Prices softened early last year as did share prices. Then from June onwards they shot up.
There had been a bit of over supply and until the peak of 2018 when the banks tightened up on the manufacturers.

 

[Rockdiamond]

Could be that I’m reading it wrong but....the graph shows sharp increases starting in about June 2020.....
I was not buying much in the way of colorless RBC’s at the time but in the fancy colors prices started shooting up in the second quarter of 2021.
Is the graph. Based on Rap prices?

 

[Garry H (Cut Nut)]

Could be that I’m reading it wrong but....the graph shows sharp increases starting in about June 2020.....
I was not buying much in the way of colorless RBC’s at the time but in the fancy colors prices started shooting up in the second quarter of 2021.
Is the graph. Based on Rap prices?

"The RapNet Diamond Index (RAPI) is the average of the best priced 10 asking prices in each category for Round, D-H, IF-VS2, GIA Graded, Rapaport Specification A3 or better diamonds, which are offered for sale on RapNet - Rapaport Diamond Trading Network. While the RAPI indices are available for 0.30 Ct, 0.50 Ct, 0.70 Ct, 1.00 Ct ,2.00 Ct, 3.00 carat size categories, the primary index will be for one carat sizes."

 

[Rockdiamond]

It's Friday....which means another jump in Rap prices for rounds.....

 

[autumngems]

Is the increase why we are seeing EVERYTHING is lab grown these days? I'm sticking to earth-mined, personal preference.

 

[RunningwithScissors]

Can you tell us more about the current round of price increases? Are some sizes more affected than others?

 

[Rockdiamond]

Can you tell us more about the current round of price increases?

When the list comes out, prices changes are indicated by bold numbers.
If the price has decreased, it's italicized bold.
Increases are indicated by underlined bold.
The increases of late have been broad-based.
The newest list shows increases for every size from .30ct-10cts.
The increases affect every color clarity, save I3 ( from .70-10ct- in the smaller sizes some of the lower color clarity combos were not raised) ( yipee if you're shopping for a .57ct ISI3!!)

It seems the list leapfrogs- one week fancy shapes, one week rounds.
There were many times that specific articles, in high demand would go up while most other segments were stable.
At this point, it seems everything is going up.

 

[RunningwithScissors]

When the list comes out, prices changes are indicated by bold numbers.
If the price has decreased, it's italicized bold.
Increases are indicated by underlined bold.
The increases of late have been broad-based.
The newest list shows increases for every size from .30ct-10cts.
The increases affect every color clarity, save I3 ( from .70-10ct- in the smaller sizes some of the lower color clarity combos were not raised) ( yipee if you're shopping for a .57ct ISI3!!)

It seems the list leapfrogs- one week fancy shapes, one week rounds.
There were many times that specific articles, in high demand would go up while most other segments were stable.
At this point, it seems everything is going up.

Thanks for the explanation. Appreciate it!

 

[John Pollard]

Recent increases may reflect speculation. ALROSA normally supplies 30% of rough diamonds, worldwide.

US Places Santions on Russian Miner ALROSA

 

[Rockdiamond]

Is the increase why we are seeing EVERYTHING is lab grown these days? I'm sticking to earth-mined, personal preference.

for sure the growth in lab grown is fueled by increases in Natural.....or so it might seem.....

Excellent point John.....

 

[MissGotRocks]

So I guess it will be quite a while before availability goes up and prices go down? Difficult times for diamond suppliers and purchasers!

 

[bright&shiny]

Well, I guess this will help me stick to my budget. Bummer but not unexpected. Thanks for the posts - as always so much good information!

 

[Garry H (Cut Nut)]

Rapaport italics key is busted.
LGD prices should never ever have had anything to do with natural prices - that is criminal. The FTC and other bodies should investigate.

 

[Texas Leaguer]

It's only logical that the sanctions on Russia are impacting diamond prices in a significant way. Without their rough moving into the market the supply/demand equation skews dramatically towards price increases. As @John Pollard suggests the current spike may be driven more by expectations of short supplies down the road. And that could reverse if there is a resolution to Russia's war in Ukraine and sanctions are relaxed.

But turning around sanctions will likely not happen overnight, even in the best scenario. So, we may be seeing a new normal. At least until things fully settle down on the world stage.

 

[oncrutchesrightnow]

Rapaport italics key is busted.
LGD prices should never ever have had anything to do with natural prices - that is criminal. The FTC and other bodies should investigate.

It seemed like there was a race to the bottom on LGD right before Christmas, but now prices have gone back up. Doesn’t that make sense if the only other diamond option is earth grown and prices for those are going up? People who get priced out of a one-carat EGD might rather switch to whatever they can afford in LGD than reduce to 0.85.

 

[Garry H (Cut Nut)]

It seemed like there was a race to the bottom on LGD right before Christmas, but now prices have gone back up. Doesn’t that make sense if the only other diamond option is earth grown and prices for those are going up? People who get priced out of a one-carat EGD might rather switch to whatever they can afford in LGD than reduce to 0.85.

No - it is avaricious pricing - totally unrelated to the cost of goods or production costs.
People jumped up and down for decades that De Beers manipulated prices by storing diamonds in safes in London (which was a gross over simplification and rarely true).
Why should there be any connection to LGD's and natural diamonds?
CVD LGD's should be cheaper as they become heavier.
A 2ct should be cheaper per carat than a 1ct.
Why does the cost for color and clarity have anything at all to do with the rarity factor of natural diamonds with fewer inclusions or les color? It should only relate to the increased sot to produce less inclusions and les color.

 

[Rockdiamond]

No - it is avaricious pricing - totally unrelated to the cost of goods or production costs.

For sure, there’s that. But supply and demand can’t be ignored. In December Signet bought pretty much all the LG 1/4 ct rounds. At that point, the people who still had some left raised the asking price.
To me, that’s different than raising large stones based on increases on the Rap Sheet.
But even there…. I was searching for a 5ct LG emerald and so much of what I was seeing was sub par. Because of long standing relationships, the grower maintained the price for us- but I could understand raising it based on demand, and quality.