TAGS September Market & Tender Report

While TAGS has continued to run regular tenders each month since our last report in May, and opened our new TAGS tender facility in Johannesburg, it has been against a background of ongoing turmoil, due to tariff threats and geopolitical uncertainty.

In Q1 the market saw signs of ‘green shoots’ that were extinguished in April with the potential of 25% tariffs (subsequently revised to 50%) on US imports affecting polished diamonds from India.

Since then, the market has operated under a cloud of uncertainty, in the hope that some kind of agreement would be reached between India and other countries trading with the US, on the levels of tariffs to be imposed. However, despite all efforts tariffs on Indian imports doubled to 50% effective 27 August.

This move has escalated tensions between the world two largest democracies and strategic partners. This followed several rounds of talks, during which Indian government officials, had at times signaled optimism that US tariffs might be capped at 15%, in line with some other major trade partners, such as the EU, Japan and South Korea. The impact of tariffs on India will be felt throughout the entire value chain, and influence market dynamics, sourcing strategies and pricing. The current 50% tariff could cripple future exports and displace thousands of skilled workers within India’s $40 billion Gem and Jewellery sector.

It remains unrealistic for US jewellers to cut India out of their supply chains completely, and while some Indian manufacturers are looking into the possibility of developing some capacity in other countries, it will never match the scale, experience, or viability offered in India with over 6 decades of experience, particularly in the smaller sizes which remain a high demand article in America.

ROUGH MARKET:

Rough producer De Beers surprised many with the announcement in early August, of $1.7 billion sales in H1, which was considered on the high side. Comments shared in the trade press by senior Botswana Govt officials critical of De Beers also caused concern in the industry.

Alrosa sales dropped during H1 amid sanctions on Russian goods and the prolonged downturn in the global diamond market. Alrosa reported a fall in revenue of 24% year on year to $1.45 billion, for 6 months ended June 30 . Alrosa also had less rough available as production was paused at some mines, and it withdrew from its Catoca joint venture in Angola.

Neither De Beers nor Alrosa have reduced their official price list, despite some Sightholders receiving ‘deals’ during recent months. This has gone some way to maintain a degree of stability in the markets.This has been particularly evident in the +2ct size bands.

The industry has now come to the end of the summer vacation. Not surprisingly all eyes wereon the De Beers August Sight and ODC’s sale, to give an indication of the market position and sentiment.

De Beers prices remained unchanged, and most DB boxes remain out of line with market prices. Deals were believed to have been offered in August, but primarily in areas of smaller sizes where stocks are high and demand is weak.

Sightholders have been informed of significant changes from October, which are indicating a reduced list of companies. Many DB staff across the centres have been reduced.

Throughout August there was talk that some of the larger manufacturing companies had already started reducing polished prices to push sales, probably as a result De Beers selling ‘deals’ at more favourable prices during June/July Early Sept, ODC sold $54m at an average price of around $114, compared to their last sale in July of $63m. at an average price of $126. This 10% reduction in September was broadly spread in goods below 10cts, with a particular focus on lower qualities below 2cts.

Demand for +5cts rough has generally been stable as +2ct polished demand has remained solid. There has also been some movement in the 3-4ct rough sizes in the better qualities.

Prices in 3-6grs and below are still weak, but there appears to be some demand in -3gr, better qualities. Col’d and Brown goods remain a weak area, with very little demand.

POLISHED MARKET:

In the weeks preceding the 27 August large volumes of polished were again shipped to US ahead of the tariff deadline. As a result, a significant proportion of orders may have been fulfilled for the upcoming Christmas season.

Those remaining for the November/December delivery could be filled by dealers and wholesalers in US. A total of $2.18 billion gem and jewellery exports were made in July from India (up 15.98% year on year, according to GJEPC). This might indicate that the real issue for the Indian industry could begin in Feb 2026 when restocking is required.

With some 40% of goods polished in India destined for US, manufacturers are looking to new markets. In recent years India’s domestic market has grown, as evidenced by large orders placed at the recent IIJS Show in India. The Far East, Middle East, and UK all offer potential opportunities, but these markets collectively are still lacking the vast scale of the US. China previously the second biggest market shows little sign of recovering to previous levels of demand. Hong Kong demand has shown some degree of recovery recently.

Overall, the uncertainty amid US tariff policy continues to put a downward pressure on polished prices. This is particularly evident in the 1ct sizes and below. Most jewellers in US have expressed deep concern that the impact will severely reduce holiday sales in diamond jewellery this year.

At the time of writing there is a challenge from the US Federal Court of Appeals being made that some tariffs imposed by The President may be illegal. President Trump has until 14 October to appeal to the Supreme Court.

Additionally, as reported in Rapnet (Sept 7 2025) ‘The White House has expressed a willingness to remove reciprocal duties on natural diamonds for select countries – but a full exemption is still some way off.‘

TAGS SEPTEMBER DUBAI TENDER:

We presented our regular Southern African tender during the first week (3 - 8 September). The event showcased close to 180 Lots, the majority of which were in goods +5cts.

We welcomed approximately 100 companies representing all the major centres. Despite the current market challenges, TAGS are delighted to report one of the best results for some time with a 92% sell through.

We are currently presenting a second tender which commenced on 8 Sept, consisting of over 400 Lots, with goods from several producer countries, and expect a similar attendance to view. This event is a broader spread of sizes and qualities.

This event will close on 12 Sept.