Global demand for diamond jewellery reached a record high of US$79 billion in 2013, according to De Beers’ inaugural Diamond Insight Report.
The 90-page report, which was published last week, also found that sales of polished diamonds in the US increased seven percent in 2013, while both India and China saw their domestic diamond jewellery markets grow by a compound annual growth rate of 12 percent in local currency terms between 2008 and 2013.
The report states that demand is expected to continue to grow over the long-term, driven by the ongoing economic recovery in the US (the world’s largest diamond jewellery market) and the growth of the middle classes in developing markets such as China and India. However it cautions that while diamonds retain their special allure with consumers around the world, future demand levels cannot be taken for granted as “the overall category is facing increasingly strong and sophisticated competition from other luxury categories”.
Speaking at the launch of the report, De Beers Group chief executive Philippe Mellier said consumer demand remains the one true source of value for the diamond industry.
“With demand forecast to increase further from 2013’s record levels, the opportunity for growth is clear,” he said, “but this must not be seen as cause for complacency. The industry will continue to lose ground to other categories if it does not invest significantly in production, marketing and technology.”
According to the report, global rough diamond production in 2013 increased by seven percent in carat terms over 2012 levels to a total of around 145 million carats, but was still well below the 2005 peak of around 175 million carats.
The report further highlights that a forecast reduction in supply from existing sources is unlikely to be matched by new production coming on-stream in the years ahead so diamond supply is expected to plateau in the second half of the decade before declining from 2020 onwards.