Editor’s Note
The global diamond market is facing a significant downturn, driven by weakened demand in China and the rising availability of lab-grown alternatives. While this presents an opportunity for consumers to purchase high-quality stones at lower prices, it poses serious challenges for industry professionals. This article examines the current pressures reshaping this $80 billion industry.
For two years, dwindling demand in China and a flood of artificial stones have been dragging down the $80 billion global diamond market.
The diamond market experienced an upswing in 2021 and 2022. However, this trend did not continue. On the contrary, the market is currently crashing massively. Prices and sales have plummeted worldwide.
What is good for luxury lovers, who can currently acquire high-quality stones cheaply, is bad for traders, producers, cutters, and jewelers.
According to the New York-based research firm “Tenoris,” the price in the US for a 1-carat diamond fell from $6,819 (approx. €6,313) in May 2022 to $4,997 (approx. €4,626) in December 2024. This corresponds to a decline of almost 27 percent. The “Manager Magazin” first reported this.
According to the report, rough diamonds and synthetic stones are also affected by the price drop. According to “Tenoris,” an artificial diamond cost $3,410 (approx. €3,158) in the US in January 2020, but buyers only had to pay $892 (approx. €826) for it in December 2024. This corresponds to a price drop of around 74 percent.
Buyers can currently rejoice. They can save on their next piece of jewelry or upgrade to more carats. However, traders, diamond producers, and mining companies are groaning under the market development and have to accept significant revenue losses.
According to “Bloomberg,” jewelry stores are closing one after another in China. Gemstones are being sent back en masse to their countries of origin because they cannot be sold. And in India, cutting operations are being sold or closed. Those that are still active often operate far below their capacity or cut synthetic stones.
But why is the diamond industry groaning so much? Analyst Paul Zimnisky told “Manager Magazin”:
The Russian attack on Ukraine also plays a role. For example, Western sanctions hit the Russian mining company Alrosa, one of the world’s largest diamond producers. Last but not least, the industry is struggling with the innovation of artificially manufactured diamonds, as they are offered at much lower prices than natural diamonds.
Artificial diamonds have now become a popular alternative to expensive natural stones. They cost significantly less, so you get a larger or higher-quality stone for the same money.
Furthermore, you don’t have to worry about questionable mining methods or environmental destruction – lab-grown diamonds are created sustainably and fairly. There is also no optical or chemical difference from natural diamonds; even experts cannot tell them apart without special equipment.
However, natural diamonds are unlikely to die out completely thanks to the cultivated competition. Al Cook, CEO of De Beers, one of the world’s largest diamond producers, told Bloomberg: