Diamond demand weakens as the stock market slumped in the September as rough producers have loosened supply to the open market. At the same time they have reduced production of rough goods. De Beers sightholders in Gaborone expressed concern that the stock market was affecting their rough value. As a result De Beers has eased its restrictions on returns, allowing the sightholders to refuse expensive rough allowing for more flexibility.
Far East
Analysts note that the economic slowdown in China was in part to blame for the diamond demand and sales. Consequently, this affected the diamond demand production. Therefore fresh concerns were deepened as the People's Bank of China allowed their currency to depreciate 3.5%. This was done to boost exports and economic activity. Diamantaires fear consumers will lose wealth in the stock market resulting in further restraints in the ability to purchase luxury materials. Hong Kong based diamond dealers Dehres Limited, Ephraim Zion notes that the general slowdown in China's economy is due to the country's crackdown on corruption and extravagance. He maintained low expectations for diamantaires for the upcoming quarter. Industry insiders suspect that the Chinese buyers will push strongly for deeper discounts as their currency to the US dollar is less valuable.
USA
Diamond demand weakens in the far east. While rough manufacturer's note that the US market is offering large discounts for cash buyers. There is a decent market for diamonds in the 1-3 carat category from F color to I color. In addition to VS clarity to SI clarity triple excellent cut GIA certified stones. The United States diamond imports valued at $12.25 billion in the first half of 2015. That figure is consistent with last years numbers. However, it is important to note that there was a 12% decline in diamond demand for polished exports. Similarly, Hong Kong's polished diamond exports dropped 4% to $9.35 billion during the same period.
Simulating Trade
Due to the current climate in the industry, manufacturers are lowering their output. They are more concerned about levels of demand at this crossroads. One industry insider said, "there's just nothing going on and we have excess capacity and inventory. But the biggest problem is that the industry hasn't invested in demand for the long term. We don't have enough demand for polished. With the liquidity concerns in the market dealers and manufacturers expressed hope that by withholding the supply De Beers and ALROSA will help simulate trading between dealers.
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