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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
- 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: