Polished diamond prices continued their decline in September, with most categories of round and fancy diamonds seeing significant drops. According to the IDEX diamond price list, as reported by IDEX Online, consumer demand for natural diamonds remains low, while the demand for lab-grown diamonds is on the rise.
India, a major diamond production hub, saw its output fall by nearly 25% compared to August 2023. This decline, along with reduced activity in global diamond trading centres, reflects the broader trend. The IDEX price list highlights that round diamonds weighing 0.50 carats and above experienced mostly decreases, with fewer price increases than in previous months.
For round diamonds weighing 1.50 carats and above, the price trends were mixed. Meanwhile, diamonds weighing less than 0.50 carats saw limited trading. In the fancy diamond market, the dominant trend was also price drops, though some diamonds specifically those weighing 0.23 to 0.29 carats, 3 to 3.99 carats, and 5 to 5.99 carats saw modest price increases.
One major factor driving this downturn is China’s crackdown on conspicuous consumption, which has significantly reduced demand in the region and created ripple effects in the global market. Martin Rapaport, Chairman of the Rapaport Group, reported a 50% drop in diamond demand in China, which has had far-reaching consequences for the industry.
The rising popularity of lab-grown diamonds is also affecting natural diamond prices. Rapaport noted that while synthetic diamonds are currently fashionable, they may eventually lose their appeal, much like cubic zirconia or moissanite. However, he emphasised that natural diamonds will continue to hold value, particularly among consumers who appreciate their lasting significance.
Looking ahead, the upcoming transfer of wealth, with an estimated $72 trillion passing from older generations to Millennials and Gen Z, will create new opportunities in the diamond market. As jewellery is inherited and passed down, both buying and selling opportunities will arise, helping to maintain the demand for natural diamonds.
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