10 Key Takeaways from De Beer's Diamond Report

1. In 2022, global consumer demand for natural diamond jewelry remained stable at $87 billion, unchanged from 2021. However, regional performance varied: the U.S. saw slight growth, China experienced a sharp decline due to COVID-19 lockdowns, and India registered healthy growth​.

   
   

2. Global rough diamond production decreased by around 2% in 2022, with total output estimated at 121 million carats. The closure of significant mines like Rio Tinto’s Argyle mine resulted in a permanent loss of over 10 million carats annually, highlighting the ongoing diamond supply challenges​​.

   
   

3. China, the second-largest market for diamond jewelry, saw a 7% decline in local currency and an 11% drop in U.S. dollar terms in 2022 due to COVID-19 lockdowns and other economic pressures. Despite this, China remains a critical market, contributing 10% of global demand​​.

   
   

4. The report notes a significant increase in branded diamond jewelry acquisitions in China, with 92% of all purchases in 2022 being from recognized brands, up from 44% in 2016. Chinese brands accounted for nearly 80% of these purchases, reflecting strong local brand preference​.

   
   

5. The war in Ukraine led to sanctions on Russian diamonds, causing disruptions in payments and logistics. Despite this, Russian diamond supply continued to reach cutting centers in 2022. Future sanctions, especially from the U.S. and G7, may further impact the market​.

   
   

6. While the declining marriage rate in China has affected bridal jewelry sales, bridal diamond jewelry remains a significant segment, accounting for 27% of the women’s diamond jewelry market value in 2022. The segment shows resilience even during economic downturns​​.

   
   

7. Upper-middle and affluent households (monthly income over RMB 15,000) represent around 60% of China’s total diamond jewelry demand, amounting to RMB 35.5 billion. This demographic is expected to continue driving growth as their population increases​.

   
   

8. Generation Z’s influence on the diamond market is growing, particularly in the U.S. where their share of natural diamond jewelry acquisitions more than doubled from 6% in 2021 to 17% in 2022. This generation is expected to be a key consumer group in the coming years​.

   
   

9. The diamond industry’s midstream sector faced significant challenges in 2022, with rising polished diamond inventories, higher financing costs, and softening prices. These factors led to decreased profitability and contributed to the buildup of inventories​​.

   
   

10. Despite current challenges, the long-term outlook for the diamond industry remains positive, particularly with the increasing importance of diamond provenance and traceability. Stakeholders are expected to benefit from continued demand for ethically sourced diamonds in key markets​.

Source: De Beers Diamond Report 2023