Small diamonds up for grabs as prices fall 15% in a year

Surat: Diamonds less than 0.30 carats are up for grabs as their prices have fallen by nearly 15% since June 1, 2018.
According to industry sources, this is the biggest fall in polished diamond prices witnessed in the last five years.
Rapnet Diamond Index, the world’s largest online B2B trading platform, has listed 0.30 carat diamond price lower by 15%. Notably majority of the diamonds below 0.30 carats are manufactured in Surat by the small and medium units. Diamonds sized between 1 carat to 3 carat, which are preferred as investment as well as in rings and pendants, have witnessed prices falling between 6% &14%, according to the price index published for June 2019.
Diamond markets in Surat and Mumbai are under pressure as profit margins have shrunk due to spike in rough diamond prices, squeezing bank finance to diamond sector , growing acceptance of lab-grown diamond jewellery and weak demand in key markets due to US-China trade war.
An indication that demand for lab-grown diamonds is on the rise was the recent JCK Las Vegas show, one of the biggest annual gems and jewellery shows of the world organised in Las Vegas. The diamond firms who participated in the event said the demand for loose diamonds and jewellery was subdued.
Diamond industry analyst, Aniruddha Lidbide said, “At this jewellery show, I was surprised to see over 50 stalls of lab-grown diamond jewellery. The inquiries at these stalls were very good, indicating that the consumer preference has changed. This an alarm bell for the natural diamond industry in Surat, especially the small and medium diamond companies.”
“Manufacturers have became cautious due to tighter credit in India and the rupee depreciation. Some US retailers are shying away from natural melee diamonds because of the threat of undisclosed synthetics. The prices in small category of diamonds have plummeted 20-25% in the last one year in Surat and Mumbai,” added Lidbide.
Babu Gujarti, president of Surat Diamond Association (SDA), said, “The diamond units in Surat are operating at half the capacity as they are trying reduce inflated inventory. Manufacturers are rejecting high-priced rough that has made production of polished gems unprofitable. The +11 category goods from 7 cents to 10 cents have witnessed highest fall in prices in the local markets due to high inventories.”