The IDEX Polished Diamond Price Index - November 2019

(IDEX Online) - The IDEX Polished Diamond Price Index showed very slight movement in November. Prices dropped marginally around the middle of the month, but returned to their earlier level by the end of November.

The Index began the month at 120.86 and ended it at 120.93.

Diamond Prices Stabilizing as Year Ends

Following declines in 2017, prices strengthened in 2018. Although prices had been on a downward trajectory throughout most of 2019, as the year draws to a close, this fall has been arrested. Prices are lower than at the start of the year, however, they seem to have found equilibrium for the past few months and even inched up a tiny amount in November. 

As the final month of the year gets underway, the Index stands at 120.84, as the graph below shows. 

On a month-over-month basis, global polished diamond prices in November edged up just 0.1 of a percent compared to October.

On a year-over-year basis, average prices in November fell 2.6 percent compared to November 2018. As we've observed before, prices seem to rise and fall on an annual basis with trends following a wave pattern of peaks and troughs.

The fact that the year-over-year changes continue to lessen - from a peak of -3.7 percent in September - seems to confirm our earlier analysis that we have seen the worst of this particular trough and the market will enter 2020 in a more positive position. However, given the precedence set in previous years, we expect another few months of declines before the market hits a positive stance.  

Diamond Prices By Size

On a month-over-month basis - November 2019 versus October 2019 - there was little change in prices. Even the 4-carat category, which tends to experience a significant amount of volatility, only declined by a modest -1.4 percent.

Once again, there was much more volatility on an annual basis. The 0.5-carat category saw an 8.2-percent decline over November 2018, 3-carat stones declined 8.2 percent and 4-carat diamonds experienced another month of loses with a 33 percent drop in prices.

Over the longer term, the price of 4-carat stones have plunged since 2015, which is immediately obvious from the graph below. Other sizes have had much more stability, with prices rising and falling much more gently.

Outlook

Trade in November continued to rise in the mid-stream, reflecting an increase in retail sales as the holiday season draws closer. 

Evidence of this increase was seen at the ninth De Beers' Sight of the year, at which sales increased by almost $100 million over the previous month - up to $390 million (provisionally) compared to $297 million in October. The miner said it had seen both increased polished price stability and an increase in sentiment from rough diamond buyers.

There are still high hopes for strong holiday trade, with good demand expected from Europe and the United States ahead of the Christmas holiday, and also from the Far East ahead of the Chinese New Year, which falls at the end of January.