No sparkle for smallest gems

THE RECOVERY in diamond prices is leaving out the smallest and lowest-quality gems. For the smallest diamonds, prices are down 15 percent this year, Bloomberg data show. That compares with an average 7 percent increase for stones yet to be cut and polished. The overall market is recovering after De Beers and Russia’s Alrosa PJSC cut supply last year. The slump in gems smaller than three grains (0.75 carat) was partly a hangover of producer stockpiling, which left a “hefty supply” to sell in the first half, said Johan Dippenaar, the chief executive of Petra Diamonds. Manufacturers were also turning more to bigger, higher-quality types, which could be bought and sold faster, consultant Gemdax said. Cheaper stones were also threatened by the rise of man-made diamonds. Average rough-diamond prices slid 18 percent last year as slowing Chinese demand and an industrywide credit crunch cut purchases.