Consumers should expect higher diamond prices as strong demand has been driving them up in recent months. After consumer retail purchases dropped in March and April, US retail activity surged in the summer months. This renewed demand includes jewelry and diamonds and is causing diamond prices to rise.
Diamond Manufacturing
The economics and activities of diamond manufacturing. A sensible place to start a background journey into the midsection of the diamond value chain.
What is Diamond Manufacturing?
It is the series of actions that transform a rough diamond into a polished diamond ready to be set in a jewelry item. It is an activity that not only transforms a rough stone into a polished diamond, the transformation process is also where the most value is added to a diamond.
The polishing process takes place in the midsection of the diamond value chain, commonly referred to as the midstream. Here is the place where knowledge, skill, and cutting edge technology come together, and are of the outmost importance for the diamond value chain.
What Happens in Diamond Manufacturing?
Diamond manufacturing involves:
- Rough diamond purchasing
- Rough diamond assessment
- Sophisticated technological tools
- Cutting
- Polishing
- Grading
- Wholesale of polished diamonds
Where are Most Diamonds Manufactured?
The majority of diamonds are polished in India. Manufacturing also takes place in Belgium, Israel, China, and Thailand.
Issues Related to Diamond Manufacturing
This section of the diamond value chain is not just the key transformation spot for diamonds, it is also the most vulnerable part of the diamond value chain. It is heavily reliant on complex financing and suffers from the thinnest margins of all sections of the diamond industry.
It also bears the greatest risk. Diamonds can break during the polishing process. The thin margins and difficult profitability means that business and can easily fall into losses. Most manufacturers are in a volume business, which does not lend itself to improved profitability.
For a deeper look into this topic, please see below:
4
Diamond Production Dropped, Now It Is Nosediving
Global diamond production sank 6.9% in 2019, the deepest plunge in a decade. By value, diamond production dropped 6.2%. There were good reasons for this, and the updated diamond production forecast calls for an even more significant slide in 2020.
The Rush for the Holy Grail: Cash Flow
Diamond wholesalers, just as any other business owners in the COVID-19 era, need to jump start their business activity, and those that could did. The result was a mid-single digit drop in wholesale diamond prices in May and an improvement in cash flow. Polished Diamond Prices Tumble Seeking Cash Flow The desire to generate cash flow, accompanied by pressures to …
4
Polished Diamond Prices Edge Down in April
Conventional wisdom holds that trading in the diamond industry should have come to a complete stop in April. This is largely true, but there are some exceptions. Polished diamond trading has continued, though at a much reduced level. Prices naturally declined, down a low single digit. Jewelry stores in China are mostly open, and a good number of stores remained …
The Golan Diamond Market Report – Q1 2020
The Q1 2020 issue of the Golan Diamond Market Report reviews transaction polished diamond prices, changes in midstream inventory & demand, and updates on prices and demand in the LGD market. All that, plus an exploration of consumer attitudes.
Lack of Confidence Hurts Diamond Prices
Wholesale polished diamond prices declined in February as diamond manufacturers lose confidence in the short-term prospects
Polished Diamond Prices Rise in January
Wholesale polished diamond prices rose in January in response to improved demand and lower wholesaler inventories. Wholesale prices of 1-carat round diamonds rose 3.7% MoM in January. US jewelry sales popped up 4.4% YoY in December, capping a slow year with sales rising just 0.7%.
The Golan Diamond Market Report – Q4 2019
The Q4 2019 issue of the Golan Diamond Market Report reviews transaction polished diamond prices, changes in midstream inventory & demand, takes an in-depth dive in to the activity of the main diamond centers, with updates on prices and demand in the growing LGD market. All that, plus an exploration into consumer attitudes towards diamond jewelry and engagement rings, checking who is interested in LGD around the world.
8
Diamond Industry Financing Is Shrinking. This Is What It Means
Diamond industry financing has considerably declined over the last couple of years, hitting a 15 year low. The industry views this as unfavorable; yet, this can be debated. A recent $3 billion “savings” provided it with a rare opportunity to realign.
The Golan Diamond Market Report – Q3 2019
After an extended period of stunted activity in the consumer, wholesale, and manufacturing sectors of the global diamond value chain, at the end of the third quarter, there are a few small signs of improvement. Following the deep decline in the second quarter of the year, US jewelry sales surprisingly picked up in July, although, cyclically, it is a month …