Proving that the Indian diamond industry’s interest in lab-grown diamonds (LGD) is fully established, India exported $445.3 million worth of these polished stones in 2019, up 71.8% year over year. By volume, gross polished LGD exports leaped 119% to 4.4 million carats.
Of most interest to many in the sector is the decline in average wholesale prices over the past year. According to government figures, the average price of exported goods declined 21.4% in 2019. As indicated by our transaction-based Wholesale LGD Price List, wholesale prices have declined throughout most of the year, but posted a price revival in the fourth quarter.
LGD Exports and the Near Future
This large jump in exports is impressive, but considering that LGD is slowly becoming an established category, plus the impact of the coronavirus on global trade, can LGD export growth continue at this rate into 2020?
As with diamonds, India is the world’s main source of polished LGDs thanks to its large polishing capabilities. Fueling the LGD polishing activity, India nearly doubled its rough LGD imports in 2019, according to the GJEPC.
This is an ongoing trend, with this year’s initial figures showing a tripling of exports in January with India importing $42.4 million worth of LGD rough, up 194% year over year.
However, the main source of LGD rough is China, which is battling with the effects of the Coronavirus on its economy. In an attempt to avoid infection, many are staying at home, limiting their exposure to large crowds to a bare minimum. This means avoiding public transportation, not visiting markets, and even dodging going to work – whenever possible.
Without a work force, production is expected to decrease, and without a steady supply of rough LGD from China, India’s ability to supply polished – even at current levels – is at risk. This week, Indian manufacturers started reporting broad shortages in HPHT made goods.
Price prediction: If demand in the consumer markets remains steady and supply is hurt, then a rise in wholesale prices is a reasonable expectation in the short-term.