New York: The diamond market showed improvements in March after Chinese demand at the Hong Kong exhibition was better than expected.

The latest RapNet Diamond Index from the Rapaport Group found the price of 1-carat polished diamonds increased by 0.1% in March and was down 1.1% during the first quarter.

There was good demand for 0.30- to 0.49-carat diamonds, and the Hong Kong show was particularly positive for dealers specialising in these sizes.

The end of the first quarter is usually strong in the first period as retailers tend to replace stock following Christmas and Chinese New Year.

The monthly report for April showed that retailers were favouring lower-priced goods over high-valued ones, reflecting a shift in consumer demands.

The change in Chinese buyers demands showed a preference towards SI diamonds rather than higher and better quality VS ones.

Diamond mining companies are also increasing production levels when compared with those of the previous year. Rough demand was steady during the first quarter whilst polished production showed an increase.

Profits made from manufacturing showed a small increase as rough prices increased from 2% to 3%. Despite the first quarter improvement, diamond trading is expected to slow down again during Passover and Easter.