January 2023 | Diamond Pulse

34 | January 2023 | Diamond Pulse | The Diamond and Jewelry Resource Book Mailed to 24,000 Jewelers Monthly - To advertise call (888) 832-1109 | January 2023 | 35 Printed & Mailed to 24,000 Jewelers Monthly CALL TO ADVERTISE 888-832-1109 Email: DiamondPulse@gmail.com WWW.DIAMONDPULSE.COM from our family to yours ee-Saw Diamond Sales Swing in Fluctuation Forecasts In 2021, natural diamond prices and related demand spiked high, mirrored, in part, within 2022. Natural diamond price increases may have affected a historic consumer sales decline of over twenty percent, which hit the market in the second half of last year. Will consumer diamond demand continue to drop? Are increased prices reflective of mines closing? The answers to these questions depend on who is being quoted. Many respectable consulting firms like Bains and the Antwerp World Diamond Centre have predicted the diamond forecast to regain “pre- pandemic sparkle” through 2024. This, while headline charts seem to be overly aggressive towards diamond demand. Cross-referencing data from several reports including Technavio’s Diamond Mining Market Forecast (tinyurl.com/TechnavioFullReport ) we captured topical quotes from diamond leaders and independent analysts for a more defined view. Being Prudent Bruce Cleaver, CEO, De Beers Group said, “Demand for our rough diamonds over the final sales cycle of 2022 was in line with expectations, ahead of the normal seasonal closure of polishing factories in southern Africa over the Christmas period, and with sight holders taking a prudent approach ahead of restocking after Christmas and the expected re- opening of the China market.” Olya Linde, a partner at Bain, said, “Prices for polished diamonds, declined by 3% and 5% in 2019 and 2020, respectively and increased only 9% year-over -year. By the end of 2021, rough and polished prices were close to pre- pandemic levels and historic averages but still below their historic maximums. (tinyurl.com/BainsReport2022 ) Independent Analysts Weigh In Diamond industry analyst Edahn Golan says, “Rough diamond prices are falling mainly due to lower demand for polished diamonds. The midstream sector of the diamond industry is now much more focused on buying the rough diamonds it needs and polishing what he thinks will be in demand.” For a competitor view, two key trends were noted by Paul Zimnisky from his State of the Diamond Industry released in June of 2022. He noted: “After being oversupplied for much of the last decade, depleting legacy mines and a very limited number of new supply sources resulted in significant year- over-year natural diamond declines.” Zimnisky’s findings include: “The diamond industry began deleveraging excess inventory following a tightening of credit conditions and constructive structural changes resulting in a much more sustainable ‘mid-stream’ going into the 2020’s. Currently, conditions are estimated to be the most profitable in at least a decade, particularly for the large, ‘more-commercial’ manufacturers with direct access to primary-market rough –however, more tenuously positioned companies face challenges related to tightening operating margins and supply shortages. (tinyurl.com/DiamondMarketPaulZimnisky ) Unsettling Lies Global luxury-conglomerate Richemont generates over sixty percent revenue from jewelry sales worldwide. They recently described the natural diamond environment as “the most unsettled in a number of years.” Leading luxe brand sales, including Cartier and Van Cleef & Arpels, were at a thirty percent growth year-over-year in 2022’s first quarter. Richemont Chairman Johann Rupert said, “We aren’t seeing danger signs- but if anybody is projecting 30-40% growth (in this environment) they don’t know what they are doing, or they are lying.” We should expect more hard-hitting quotes as “the gloves come off” editorially and we continue to embark on the see- saw situation of diamonds (mined and man-made) in 2023 and beyond. ◊ Dan Scott is the founder and brand architect of NewYork/metro’s Luxe Licensing, a digital original content production facility, marketing and licensing agency catering to established, newly launched or relaunched luxury and demi-fine brands. Current and past clients include Chanel, Gucci, Harry Winston, Studio by Henry Dunay, Crevoshay, Tess Sholom Designs and other non-jewelry based properties. Dan welcomes conversation and may be reached through www.LuxeLicensing. com, dans@luxelicensing.com or texting +1 201 294 3697. MARKET CHARACTERISTICS Ranging from 2022-2026, Technavio’s analysts expect the market to grow by a CAGR of 4.14% through 2024. The competitive structure of the report is analyzed using Porter’s five forces analysis. The market analysis also includes key challenges faced by the vendors as well as trends and drivers which will impact the market till 2024 . GROWTH+FORECAST The diamond mining market is fragmented. The market growth is expected to change if the market structure alters due to industry consolidation, or if some exit. Technavio analysts estimate the market to grow at a CAGR of 4.14% till 2024. During the forecast period, the market will show an accelerating growth of $1824.17 million. GLOBAL DIAMOND MINING MARKET SNAPSHOT