19 / 90
16
Source: De Beers
F I G . 4 :
CONSUMER DEMAND AND DE BEERS ROUGH D I AMOND SALES
OVER T IME ( 1 980 - 20 1 3 )
Nominal De Beers rough diamond sales
US recession years
Asia/Japan financial crisis
Consumer demand (Nominal USD PWP)
20
15
10
5
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1987
1986
1985
1984
1988
1982
1981
1980
1983
0
3
6
USD billion
0
25
9
NOMINAL
DEBEERS
ROUGH SALES
PWP
However, the positive supply demand outlook can be
expected to be impacted by the cyclical nature of the
industry. It is especially prone to the ‘ripple effect’
caused by de-stocking and re-stocking by midstream
operators to fulfil lower or higher demand. Despite
this, over the past 50 years rough diamond values have
consistently recovered as economic growth rebounds
(see Fig. 4).
THERE ARE TWO KEY ASPECTS TO THE HEALTH OF THE
DIAMOND INDUSTRY IN THE NEAR FUTURE
The first is
safeguarding and nurturing the diamond
dream
– that is, the allure that diamonds have for
consumers, based on their association with romance
and a sense of the eternal, and the fact that they are
seen as a lasting source of value. As always, changing
consumer preferences, competition from other
luxury categories, and – among other risks – the
potential confusion caused by undisclosed synthetics
and treatments all pose challenges for the entire
diamond industry.
The second is
innovation and differentiation
to take
full advantage of opportunities created by the expected
growth in diamond demand.