The year 2023 was a difficult one for the world diamond industry. There was a significant decline in demand, especially for mid-range sizes. The challenging global economic situation and high-interest rates impacted demand, although perhaps this was a case of the market correcting itself after the splurges in diamond and jewelry spending in the Covid years. What made it even more difficult for us was the large amount of lab-grown diamonds entering the market, especially in the .50 to 2 carat sizes, the “bread and butter” of the industry.
We did see cause for cautious optimism at the end of the year. The holiday season was better than expected. De Beers generic marketing campaign of $20 million apparently had a positive impact on natural diamond sales. Moreover, the two-month freeze on rough diamond imports to India, as well as De Beers announcement that they would reduce their rough production in 2024 by 25%, led to expectations that the market would stabilize, that demand for natural diamonds would grow and prices would rise somewhat. De Beers began the year by reducing prices at their January sight by an average of 15%, which should contribute to the competitiveness of natural diamonds going forward.
In 2024, we will continue to face significant challenges. The President’s Meeting in Shanghai on March 5 – 7, 2024 will address the most important of these issues. We will discuss the G7 sanctions, and although it is not yet clear how the sanctions will be implemented worldwide, they will likely present obstacles to the free flow of the diamond trade. (See the Opinion Piece by Alan Cohen below, which addresses this.)
At the meeting we will also be looking seriously at the Chinese diamond market, to learn what is holding the market back and what we can expect in 2024. We will be bringing together important companies from Hong Kong and China, government officials and our bourse presidents to discuss how the WFDB can help move the Chinese market forward.
Moreover, we will look at the need to work together as an industry to raise demand for natural diamonds. And we will discuss the success of lab-grown diamonds and their impact on the natural diamond industry. I hope to see you, the Presidents of the 27 WFDB bourses, at this important meeting in Shanghai. We are working on what I believe will be a very interesting program, filled with top-class speakers and panelists. We’ll also have time for sightseeing and camaraderie, so do plan to join us. Here’s the link for registration. http://cnsde.com/#/meetings?id=f7NOKRE3EJ8%3D&meetName=GJvTDv0NTmI%3D