The diamond market saw subdued trading in January, with mixed reports on holiday sales, according to Rapaport. While demand remained weak, there were signs of stability in certain categories, including 0.30- to 0.50-carat, D to F, IF to VVS2 diamonds. Larger fancy-shape diamonds of 3 carats and above also performed relatively better.
Market Performance and Price Trends
The RapNet Diamond Index (RAPI™) for 1-carat diamonds, covering round, D to H, IF to VS2 stones, fell by 2.3% in January. Smaller diamonds saw more modest declines, with the index for 0.30-carat and 0.50-carat diamonds down 0.4% and 0.6%, respectively. Prices for 3-carat diamonds dropped by 0.9%.
Despite overall market softness, there was some improvement in demand for specific diamond categories, particularly higher-quality smaller stones.
De Beers and Botswana Agreement
De Beers and the Botswana government have finalised a new agreement that extends the mining licences of their joint venture, Debswana, beyond 2029. The agreement extends Botswana’s diamond mining licences and includes measures to support the natural diamond sector. Botswana remains a significant source of rough diamonds for the global market.
Meanwhile, De Beers held its first rough diamond sight of the year, maintaining prices but selling fewer stones. The cautious approach reflects ongoing market challenges, with weaker demand for rough diamonds.
US Trade Regulations and Tariffs
US Customs and Border Protection (CBP) is increasing scrutiny on the origin of polished diamonds. Importers must now disclose the country of origin for their stones. However, diamonds that entered the market before US sanctions on Russian diamonds were implemented—referred to as “grandfathered diamonds”—are expected to be exempt.
Rapaport has introduced two new standards: the Rapaport Ethical Sourcing Standard (RESS) and the Rapaport Traceability Standard (RTS), which address concerns about ethical sourcing and traceability in the diamond trade.
Additionally, potential US tariffs on Canadian and Mexican goods could impact the diamond trade. If implemented, Canadian diamonds may face higher import costs in the US market.
While the Chinese holiday season has not significantly boosted demand, the Indian market remains stable, continuing the trend of uneven demand across key regions.
