TAGS May 2026 - Market & Tender Report

Despite the inference from US that the conflict with Iran would be over quickly, the world still waits as tentative peace discussions ensue.

This escalation of geo-political tension in the Middle East, has had a significant effect on trading hubs like Dubai where flight disruptions and travel fears reduced customer traffic.

While TAGS managed to host a slightly reduced tender schedule during the past two months, several other tender houses relocated a few of their sales to India on a temporary basis with only average results.

The macro-economic effect however remains huge. Rising oil prices effect everyone, and India, as a large importer of oil, are feeling a direct impact.

This impedes the ability of Central Banks to reduce interest rates, and has caused recent volatility in the Rupee, which has in turn affected the diamond industry. The weaker Rupee ($1 to 95 rupee) heavily impacts the current market, particularly in the small sizes and cheap goods.

Despite this situation, many of the ongoing issues within the industry remain broadly structural.

The recovery of the market remains reliant on a coordinated marketing approach to differentiate LGD from Natural Diamonds, a radical shift in retail practices and attitude, and the future of De Beers under new ownership.

With consumer spending heavily impacted by global issues the new owner will hopefully have the necessary ability and budget to reignite the industry.

Rough:

As we entered May, which marks summer holidays in India, and a quieter season for polished, rough trading has slowed particularly in smaller sizes.

A small De Beers May Sight 5 was presented again with no price adjustments in small sizes, but as in previous sales, Sightholders had the option to refuse all smalls and cheaper ranges, without penalties.

In the past few weeks the sales team of Alrosa visited India and indicated that the expected contract sales in May would be cancelled and replaced by a tender system.

However, when the goods list was released, it contained around 5m cts of goods 3grs and below. This news has shocked the market, as there is simply no demand for these goods, especially now in the quieter period.  Some 20 companies have been invited to view in Moscow, and the result will be announced on 1st June.

In Angola, Luelle and Catoca continue to sell into the market, but prices continue to fall.

While De Beers hold considerable rough stock, in Botswana, many ‘junior miners’ continue to close permanently or have been put on ‘care and maintenance’ during the past year alone.

This has led to shortages, particularly in the larger sizes and the corresponding increases in price across those ranges.

As touched on in our last report, it is difficult to underestimate the impact of this reduction in natural diamond supply, which has been dramatic.

Global Rough production this year is estimated at approximately 95 – 100m carats, the lowest level since 1987.

In effect as we look ahead, there are just 3 entities which control most of the world production, De Beers, Endiama and Alrosa. 

Currently, in contrast to their previous stance of tighter distribution, Alrosa and Endiama seem to want to sell regardless of the market conditions and meanwhile De Beers still waits for a buyer who it is hoped might generate some much-needed stability into the market.

Let’s hope that this consolidation of supply, might generate some coordination going forward, and the industry can drive an upward trend in rough prices, following a year-on-year decline of as much as 50% since the peak of 2022.

The recent WFDB Summit was held in Gaborone from 18-19th May. The summit focused on the long-term positioning of rough diamonds and the alignment of provenance, beneficiation, sustainability, transparency, and value creation across all producing countries and trading centres.  A key milestone was the announcement that Botswana and Angola will join WFDB as Nation Affiliated Members, further cementing relations between producer countries and the global trading community

From the mining perspective, producers cannot economically choose what they mine, so a further challenge going forward for all will be the less desirable sizes and qualities. For these the industry will either have to rebuild demand or find alternative uses.

Polished:

Despite all the gloom in the mid-stream, the retailers at the higher end are doing relatively well. The latest results from Richemont Group (+8%) indicate that consumers are still willing to spend.

The recent Gem Geneve Show (7th-10thMay) attracted a record number of participants since the launch in 2018. The bulk of attendees were from European countries, and the show was considered a success.

All eyes will now be on the JCK Vegas Show (29th May-1st June), which is one of the strongest indicators of the US market going forward.  There are positive expectations for the higher end of the market and in +2ct sizes.

While prices for +2ct polished remain strong, other polished price points have remained generally unchanged in recent weeks.  The main concern is the possibility of prolonged unrest in the Middle East, and the willingness of consumers to purchase diamonds at a time when higher cost of living impacts household budgets globally, resulting in less discretionary income.  The impact of this will be felt by all the leading consumer centres.

While shortages in larger size polished has generated an increase in price, as availability reduces, it’s hoped that the same might ultimately be seen in other size categories, but this would take an industry wide push to promote demand for eg. 1ct polished which has been decimated by consumers opting for LGD.

Another important move required is a change in the industry’s approach to selling LGD. Currently retailers are presenting Natural Diamond alongside LGD, as an interchangeable product which is considered ‘identical’.  This approach can only continue to erode natural diamond pricing.

In India the market is stable with steady demand from US buyers.  The domestic Indian market as previously reported is solid, although currently polished manufacturing has slowed due to May holidays.

It is reported that the Chinese mainland buyers are moving towards LGD, and natural below 0.30pts is hard to sell.  Hong Kong consumers continue to purchase goods from 0.50 up (D-F IF-VVS).

A concerning statistic coming out of India, is that for the first time ever India has exported more LGD that natural polished. Official figures confirm March exports of 1.4m carats compared to 1.3m carats of natural, and it is believed the trend has continued through April and May.

TAGS Tenders:

Since our last report we have completed 1 further sales event in Dubai.

This comprised, 1 Single Supplier Southern African Production of primarily High-end material.  

There was strong demand particularly in the larger sizes +10ct, and steady demand in 2-10ct ranges.  We witnessed some demand in 3-6gr but these goods remain very price sensitive. Overall, we had an 80% sell through.

We are currently presenting our multi-supplier event, which completed on 29th May.

In Johannesburg our office has concluded 2 further sales events since end of April, the last concluding on 26th May.  We are very pleased to report that our South African tenders continue to grow in volume as we establish our reputation and presence locally and build on the number of local suppliers.

Our forthcoming tender in Dubai starting in mid-June will be an Original Zimbabwe production, of close to 500k carats.

More details and future tender dates to follow.