Six major factors will determine the makeup of the diamond industry this year, following a market decline in last year’s second half, according to Rapaport Senior Analyst Avi Krawitz.
In his quarterly Diamond Trends webinar last week, Krawitz pointed to economic uncertainty in the US, the recovery in China, and the changing landscape of lab-grown diamonds as issues that would impact demand in 2023. On the supply side, he cited the sanctions on Russian diamonds and the pending agreement between De Beers and Botswana’s government.
Some of those developments have led to a rising interest in source-verification programs, which is the sixth factor that will affect the trade, he said.
Krawitz also outlined retailers’ results for 2022 as a whole and for the holiday season in particular, noting a slowdown in sales during the second half of the year. After a strong start, diamond jewelry sales likely fell 5% to 10% for the full year, he estimated.
The drop in demand, along with high polished inventory in the midstream, led to a decrease in polished prices that has continued into 2023, he added.
Watch the full webinar below for more details on these points:
Correction, February 22, 2023: Please note that there was an error in the data presented in the webinar relating to the import of rough diamonds from Russia to Belgium during the first 10 months of 2022.
Belgium’s rough imports from Russia fell 53% by volume to 11.6 million carats in the first 10 months of 2022, and not 29% to 2.6 million carats as initially reported in this article. The combined imports of Russian rough to Belgium and India amounted to 15.7 million carats during the same period, down 44% by volume from the previous year, and not as stated previously. The following is the correct graph that reflects the imports of Russian rough to Belgium and India.
Image: A dealer showcases his diamonds. (Shutterstock).