IDEX Polished Price Index: A 15th Month of Consecutive Decline
June 05, 23
(IDEX Online) - Polished diamond prices were down yet again during May with the prospect of a global recession still looming large. The IDEX Polished Price Index, derived in real-time from actual global industry asking prices is now down just over 22 per cent on its peak in March 2022. It's been sliding ever since then. Last month it slipped by 1.27 per cent, down slightly from 1.47 per cent in April, although in March is lost only 0.98 per cent.
The overall picture remains gloomy. Midstream inventories are building as consumer demand slows, in response to inflation in the US and elsewhere. China's widely expected post-lockdown bounce hasn't materialized. And there is still the prospect of G7 sanctions on Russian goods, even though leaders failed to reach agreement when they met last month in Japan. De Beers' sales were down 20 per cent in May. It cancelled auctions because of poor demand and Petra held back parcels of over 75,000 carats at its May tender for the same reason.
Zoom out a little and we can see the Index levelled during Covid but climbed throughout 2021 and until March 2022 when we felt the effects of the Covid bubble bursting and Russia's invasion of Ukraine. The Index has been dropping steadily ever since.
Month-to-month prices fell 1.9 per cent in May, compared to 2.1 per cent in April. Monthly drops have averaged 1.6 per cent over the last year. The rate of decline slowed from December 2022 to March 2023.
Year-on-year prices for May hit another low at 18.1 per cent, marginally down on 17.7 per cent in March and April. They're the worst in at least the last four years, and are worse than any month during the Covid pandemic Year-on-year prices - no longer insulated from world events by the De Beers monopoly - have been in decline since April 2022 and have been below zero since December.
Polished month-on-month prices fell for all sizes shown below in May, as they did in April. Losses were more pronounced (around 3.0 per cent) among 0.50-cts and 4.0-cts goods and less so in the size between. In April it was the other way round.
Year-on-year prices for May fell sharply again, largely in line with those for April. 1.0-cts fared worst, down 21.8 per cent, closely followed by 1.5-cts and 2.0-cts. Larger goods performed better - 3.0-cts and 4.0-cts fell 10.2 per cent and 8.6 per cent respectively.
Prices for all sizes shown below kept on falling in May, as they have been for more than a year. One of the worst casualties was 4.0-cts goods, which have largely been resistant to the recent decline.
Assessment: The Index has now been in decline for 15 months and there's little to suggest things will change any time soon, although JCK at Vegas may provide a much-needed nudge in the right direction.