MUMBAI: Diamond prices fell in March as the spreading coronavirus led to a dramatic decline in the global economy. Diamond markets are under pressure and facing a severe liquidity crisis as jewellery retail, diamond manufacturing, and trading shut down.
The RapNet Diamond Index (RAPI) for one carat diamonds dropped 6.8% during the month and 8.7% in the first quarter. Prices slumped amid slowing demand and increasing supply.
Manufacturers bought large volumes of rough between December and February, anticipating strong inventory replacement after a good US holiday season. De Beers' rough sales exceeded USD 1.3 billion in those three months preceding the pandemic, while Alrosa's reached USD 1.1 billion.
De Beers cancelled its March sight, and Alrosa allowed customers to defer their full allocations in early April. Rough prices are expected to decline when sales resume. Prices at March rough auctions slid from 15% to 25%.