Inventory in the diamond trade will remain high for the time being amid reduced retail demand, but the market will eventually rebound, De Beers has predicted.
“While there have been some positive signals in some countries, with US inflation continuing to fall and the economy proving more resilient than anticipated, 2023 consumer demand for natural diamonds is expected to be below the record levels seen in 2021 and 2022,” the miner said in its annual Diamond Insight Report, which it published last week. “While high polished-diamond inventories in the midstream are likely to remain elevated in the near term, they are expected to fall back to normal levels in the medium term as trading conditions recover.”
Global diamond-jewelry demand was flat at $87 billion in 2022 as strong growth in India and a slight increase in the US offset a sharp decline in China as a result of Covid-19-related lockdowns, De Beers explained. Demand rose 10% over 2019.
Demand for diamond jewelry increased 1.7% to $47 billion in the US and went up 8% to $5 billion in India. In China, demand slid 11% to $8.8 billion.
Global polished-diamond demand rose 0.3% to $27.8 billion in 2022, De Beers estimated. In the US, it increased 1%, and in India, it gained 15%. Demand in China slipped 9%.
Meanwhile, global diamond production fell 2% in 2022 to 121 million carats, the miner continued. Output was up 5% in Russia and rose 4% in Botswana. Production decreased 6% in Canada and was down 27% in the Democratic Republic of Congo (DRC). In Angola and South Africa, production was flat. Meanwhile, global rough-diamond sales increased 8% year on year to $17.2 billion.
Main image: Rough diamonds. (Shutterstock)