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The diamond-industry, pre- and post-coronavirus

Hi Willy,

I wonder if you have clearly read my last post. I did not say that supply is down, I said that sales of rough is predicted to be down. Sales is the result of supply and demand, not supply only.

Now, for more clarification, please read the original post again. Many mining countries have also experienced lockdowns. Some are still in lockdown. But all in all, with cutting countries in lockdown, there are virtually no sales of rough diamonds, and thus the major miners have canceled sight after sight, while moving mine after mine into 'care and maintenance'. That is the side of reduction of supply.

As far as demand for rough goes, India with 90% of the world's cutting-capacity is the main center, and it is mostly still in lockdown. Cutting has resumed somewhat now, but it is estimated to be at 30% of capacity. With many migrant workers, when the lockdown started, these workers literally had to walk back hundreds of miles towards their villages. And they are not rushing to return. At the same time, new realities of social distancing create difficulties in production (how can you put more than one person at a wheel?) and in lodging (how can you guarantee social distancing in the lodging of the past?).

At best, we have reduced production because of technical reasons, leading to reduced demand for rough diamonds. And that comes after a long period of no demand for rough diamonds, because of no production. That is the side of reduction of demand. For rough diamonds, mind you.

What the development will be at the consumption-side of polished diamonds remains to be seen. It is an unknown.

Live long,
 
Paul
Thanks for the explanation.
 
Report from street level...
Weird is the best way to describe what's going on.
For months, demand was a trickle. Lack of supply was unimportant. Prices were stable, for those companies still operating.
All of a sudden, it's like someone opened a flood gate.
Now, lack of supply might make a difference on the ground, where we can see the effects.
Price increases are certainly possible.
Weird.....

PLUS- there's been a revolt against Rappaport- so many companies have pulled their goods from Rap's site.
This is also a contributing factor.
From my perspective, it makes no sense to limit exposure to one's goods....but this instability is also affecting things in general
 
interesting times
 
And a super interesting note about Rappaport specifically.....
I've been suggesting to dealers/cutters we work with to return their goods to rap.
They're telling me ....um, no thank you.
From my perspective:
Having a super broad database to use for getting a feel for the market is crucial. Removal of a "central" database makes the job of evaluation much more complicated.
Today, someone asked us to buy his 4ct diamond- or sell on consignment. Before, I could simply go on Rapnet and get the basic lay of the land. The prices of comparable stones in terms of shape, cut color, etc....
Today, after going on Rap, I noticed immediately the smaller sample size. The prices on Rap are no longer reflecting reality. Many of the most aggressive sellers left.....this affects the average on Rapnet.
It makes valuation far more difficult.
 
RapDiamond / David —perhaps you could explain your posts in laymen’s terms. I am not Trade, most on this forum are not Trade, you use words like Rapnet, Rappaport, etc. I don’t know what this means. Other Trade people on this forum do understand because this is your business. I am just an enthusiast. thanks.
 
Thanks for asking Willy and sorry if I was speaking as if everyone knows the terms.
We have been discussing Martin Rappaprt. He puts out a list which dealers have used as a guide. Till recently.
A large part of Martin Rappaports online platform is a trade only compilation of diamonds available to dealers.
Until recently this was the primary platform. There were others but Rappaport ( also known as “Rap” or “Rapnet”) was the main one. My post was pointing out that the situation has changed
 
WillyDiamond said:
RapDiamond / David —perhaps you could explain your posts in laymen’s terms. I am not Trade, most on this forum are not Trade, you use words like Rapnet, Rappaport, etc. I don’t know what this means. Other Trade people on this forum do understand because this is your business. I am just an enthusiast. thanks.
Click to expand...
Rapnet is a diamond marketplace and search engine very similar to the PS diamond search except it has a few different options and is business to business.
A lot of the vendors who sell diamonds to other vendors have left rapnet, it is to early to tell if they will return.
 
@Rockdiamond The Rappaport price tables must be loosing to Google - there are so many public prices & I keep wondering for how long can this be [as it cannot be that much nicer to buy than to sell such things.]
 
Last edited:
Thank you for the clarification.
 
Not really loosing to google per se @AV_
Although there’s many dealers who used to sell wholesale that have gone into selling retail ( including me 20 years ago) many of the larger dealers on 47th street do not want to work with retail consumers.
It’s actually an entirely different business- wholesale versus retail.
So, maybe google is facilitating the newer B2B platforms that are competing with Rapnet- but other than that the wholesale pricing of diamonds is not “public” information.
 
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@Rockdiamond Does anyone use public retail prices as reference for B&B? [a reverse Rap]
 
AV_ said:
@Rockdiamond Does anyone use public retail prices as reference for B&B? [a reverse Rap]
Click to expand...

It's unworkable for many reasons.
A few:
*Many of the stones listed on retail sites are not actually available. And in many cases, the lowest priced ones are not available. Traditionally, Rapnet was fairly dependable in that regard.

* many stones are listed on multiple retail sites- and at different prices. Rapnet has a feature that allows you to see if a stone is listed by multiple sellers ( some are )
 
@Rockdiamond From my side of the screen, every asking price is a price - all of those count toward what I will expect, so it not unnimaginable that a kind of public quote [not necessarily curated tables] could serve as reference for discounting effective transaction prices - at some remote, unthinkable time ...
 
Rockdiamond said:
Today, after going on Rap, I noticed immediately the smaller sample size. The prices on Rap are no longer reflecting reality. Many of the most aggressive sellers left.....this affects the average on Rapnet.
It makes valuation far more difficult.
Click to expand...
I think you have just described the situation that diagem? Serg? has talked about previously - in the absence of a centralised pricing database, will things have to revert to pricing by local factors?

That could be an interesting situation given we now have the internet to rely on, rather than walking into town to see what the only jeweller in the area has in stock and assuming (hoping) they are charging reasonable prices!
 
AV_ said:
@Rockdiamond From my side of the screen, every asking price is a price - all of those count toward what I will expect, so it not unnimaginable that a kind of public quote [not necessarily curated tables] could serve as reference for discounting effective transaction prices - at some remote, unthinkable time ...
Click to expand...

Like I said previously, industry at large will need to reassess, its looking more and more like we all are going to have to rediscover diamond values..., some segments will stay unchanged, some will appreciate and no doubt some be hit bad. At the end, transparency will prevail.

This industry is based on old-school models or even may I dare say prehistoric models, a lot of dinosaurs still running around, move their cheese and they go lost..., we are at such an event nowadays.
 
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AV_ said:
@Rockdiamond From my side of the screen, every asking price is a price - all of those count toward what I will expect, so it not unnimaginable that a kind of public quote [not necessarily curated tables] could serve as reference for discounting effective transaction prices - at some remote, unthinkable time ...
Click to expand...

Stranger things have indeed happened! It would be silly to rule anything out at this point.
My veiwpoint is different than Yoram's for a lot of reasons. A large one could be geographic. In the NYC Diamond District, from where I sit, the "dinosaurs" are still kicking- and mightily. I'm not so quick to write them off....
 
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Paul-Antwerp said:
One month after my original post, a lot has happened. Still, a lot is remaining at a standstill too.

It will be interesting to see tomorrow's online-presentation by Martin Rapaport. Traditionally, the Rapaport Breakfast is a big thing during the Vegas-show. And you can count on Martin coming up with a new topic every year, often coinciding with a new initiative of the Rapaport-group. Even then, listening to Martin expressing his truth is entertaining, educational and sometimes eye-opening.

Tomorrow, he will present his yearly highlight online. I am truly curious how he sees the State of the Industry. Surely, he will defend the business of the Rapaport-group, but I wonder how he will position it.

Stay tuned, thus. Looking forward to tomorrow

Live long,
Click to expand...
Here it is, for you who are interested in a 2 hour Rapaport injection..

 
Luxury.. Schmugshery....

Lol, this is a quote of the day from Rap talk.

All in all it was pretty straightforward speech... No massive surprises. I am with the previous poster who mentioned that it is somewhat disappointing that he brushes off the whole lab diamond market. Not quite sure whether he is underestimating this, as lab diamonds actually fit quite nicely into the trends of sustainability (I know this is not quite the case from a perspective of electricity consumption, but at least they are easy to position that way)
 
Dizzie said:
Luxury.. Schmugshery....

Lol, this is a quote of the day from Rap talk.

All in all it was pretty straightforward speech... No massive surprises. I am with the previous poster who mentioned that it is somewhat disappointing that he brushes off the whole lab diamond market. Not quite sure whether he is underestimating this, as lab diamonds actually fit quite nicely into the trends of sustainability (I know this is not quite the case from a perspective of electricity consumption, but at least they are easy to position that way)
Click to expand...

Yes I find it very interesting how any big player in the mined diamond industry is so fast to talk lab diamonds down. To me as a customer it almost seems they’re scared of what lab diamonds could do to their business. I can’t wait for a company like Whiteflash or HP diamonds too tackle the lab grown market and sell ideal cut lab diamonds from high quality rough. I know both those companies have no interest in lab diamonds, but maybe somebody will take them as an inspiration.
 
Lessics said:
Yes I find it very interesting how any big player in the mined diamond industry is so fast to talk lab diamonds down. To me as a customer it almost seems they’re scared of what lab diamonds could do to their business. I can’t wait for a company like Whiteflash or HP diamonds too tackle the lab grown market and sell ideal cut lab diamonds from high quality rough. I know both those companies have no interest in lab diamonds, but maybe somebody will take them as an inspiration.
Click to expand...

I was a panel participant on a international webinar yesterday discussing detection of lab grown and treated colored diamonds etc. Interestingly some of the synthetic manufacturers who have been around for a while are reducing their gem output because they have raised their skill levels and are producing high grade industrial diamonds. Companies pay more for these goods than the jewellery industry!
 
Garry H (Cut Nut) said:
I was a panel participant on a international webinar yesterday discussing detection of lab grown and treated colored diamonds etc. Interestingly some of the synthetic manufacturers who have been around for a while are reducing their gem output because they have raised their skill levels and are producing high grade industrial diamonds. Companies pay more for these goods than the jewellery industry!
Click to expand...

What are high grade industrial diamonds?
 
Mlh said:
What are high grade industrial diamonds?
Click to expand...

Used for cooling computer chips in guided missiles, as windows into high pressure or high temperature experimental devices.
Diamond bearings.
Diamond is an amazing substance - tops the charts on every known physical property.
 
Garry H (Cut Nut) said:
Used for cooling computer chips in guided missiles, as windows into high pressure or high temperature experimental devices.
Diamond bearings.
Diamond is an amazing substance - tops the charts on every known physical property.
Click to expand...

Wow. I had no idea! Thanks @Garry H (Cut Nut) !
 
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