Lab-GrownSep 20, 2023
Lab-Grown Diamond Outlook: Price Declines Aren’t a Deterrent SourcingSep 20, 2023
Natural Diamond Outlook: Indian Diamantaires Navigating Multiple Storms
Economic slowdowns, geopolitical tensions, and the rising popularity of lab-grown diamonds are clouding the outlook for mined diamonds.
Diamantaires in India currently face a number of challenges when it comes to natural diamonds, including a post-pandemic decline in consumer demand.
Mumbai—There are dark clouds hovering on the horizon as the Indian diamond industry prepares to enter the last few months of 2023 and look beyond to early 2024.
The clouds have been gathering for a while, the result of multiple smaller storms that have been brewing over the past year or so.
Major markets are seeing an economic slowdown, with the shadow of a possible global recession looming large.
Geopolitical alignments are changing, a factor that has gathered momentum following the start of the war in Ukraine.
These developments are having a big impact on global trade.
To top it off, there has been a sudden alteration in market dynamics within diamond jewelry retail, particularly in the United States, as lab-grown diamonds have made rapid inroads in the engagement ring segment.
Over the last 12 months, production of polished natural diamonds has slowed, dropping well below the levels seen last year.
Figures released by the Gem & Jewellery Export Promotion Council (GJEPC) show that between April and August 2023, i.e., the first five months of the Indian fiscal year 2023-2024, exports of polished diamonds have declined by 30 percent year-over-year in value terms, from $10.01 billion to $7.03 billion, and by 28 percent in volume terms, falling to 8 million carats from 11.1 million carats a year ago.
Sluggish Consumer Demand Worldwide
Ajesh Mehta of D. Navinchandra Exports, who is also convener of the Diamond Panel Committee of GJEPC, characterizes the downturn as being the result of “the vicious cycle of market forces.”
“Demand is sluggish across the world,” he explained. “The plateauing of the U.S. market was not entirely unexpected as the stimulus effect had ended and other categories of luxury experiences, like holidays, travel, etc., were once again available to consumers.”
However, the global slowdown has been deeper and wider than expected, he noted.
Diamond market analyst Pranay Narvekar of Pharos Beam Consulting said the no-show from Chinese consumers has hit the industry hardest.
“Indian diamantaires had high expectations after that market opened up in early 2023. Yet, as the year progressed, Chinese demand has remained stagnant. An important chunk of the global market has gone missing.”
GJEPC Executive Director Sabyasachi Ray believes manufacturers of small goods have been most impacted by the lack of demand from the Far East, which they had hoped would balance the end of the surge in demand from the U.S. market.
Additionally, there is another challenge the industry faces in what he characterizes as “mid-size goods,” diamonds between 0.70 and 2.5 carats. U.S. consumers have shown a preference this year for lab-grown diamonds in those sizes.
“India has a significant share in these sizes as well,” he said.
Impact Reaching Supply Side
As often happens, changes in supply patterns have lagged behind the drop in demand.
The inflow of rough diamonds has not slowed at the same pace as exports. In the first five months of this fiscal year, Indian imports have declined by 18 percent in value terms, from $7.9 billion to $6.4 billion, while remaining flat in volume terms.
Recent sales indicate that adjustments are now beginning on the supply side as well.
Observers believe that cutting and polishing of natural diamonds has been around 50 percent of capacity levels during the past year. However, unlike in previous downturns, this has not led to idle wheels and mass layoffs.
Most units have switched to cutting and polishing lab-grown products fairly seamlessly, along with some shortening the work week and cutting wages accordingly.
It is anticipated the traditional closure of diamond factories during the Diwali festival, which falls in mid-November this year, will be longer than usual.
Meanwhile, manufacturers’ stockpiles of polished diamonds are accumulating, even as prices have declined across most sizes.
Discussions With Miners
Against this backdrop, the Indian industry has reached out to major mining companies.
“After extensive consultations among diamantaires, we have communicated with miners and requested them to adjust their supply to market realities,” the GJEPC’s Ray said. “We are hopeful of a positive response so we can all ride out this difficult phase together.”
India’s domestic market provides another ray of hope.
Related stories will be right here …
Ajesh Mehta said, “The buzz at the [new loose] diamond show held as part of IIJS Premiere indicated that demand remains strong within the country, and the trade is looking towards Diwali and wedding sales to provide a boost.”
Prospects for China remain unclear, and the industry hopes that the Hong Kong show at the end of September will provide some hint over which way the winds are blowing, he added.
Depending on the outcomes in these markets, and the steps taken by mining companies, the industry will plan its next moves to balance the supply-demand equation.
The War in Ukraine
India also is gearing up to face new challenges after leaders of the Group of Seven (G7) announced they would be working together to tighten sanctions on Russian goods, including diamonds. The new sanctions reportedly will take effect Jan. 1.
Discussions have been going on at a government-to-government level and the exact details of the restrictions that will be implemented globally remain unclear at this point.
Many in the industry are hoping they will only apply to goods weighing 1 carat and above.
“In our discussions with U.S. officials, we have emphasized that tighter sanctions will hit the livelihoods of millions of artisans and their families,” GJEPC officials have said.
While individual companies with significant business in the U.S. already had initiated measures to ensure segregation within their pipeline following the initial sanctions imposed in 2022, preparations are on now for an industry-wide system.
Trade bodies are putting the finishing touches on a system for tracking all goods above a certain size as they move through the cutting and polishing process in India.
GJEPC officials said once this scheme is in place, an official body will be able to certify segregation of a large spectrum of polished, barring perhaps the very small sizes.
This will ensure sanctioned goods are not sent to G7 markets, they said.
Disruption has become part and parcel of every business today, spurred by a combination of factors ranging from new technologies to political alignments to consumer sentiment.
A senior member of the industry recently averred, “The natural mined diamond manufacturing industry in India appears to be going through such a churning today.”
More on Sourcing
The Latest
Supplier BulletinSep 18, 2025
Will Your Design Define 2026? Enter The Spectrum & Cutting Edge AwardsSponsored by American Gem Trade Association
SurveysSep 18, 2025
Deloitte Thinks the Holidays Will Be Merry, PwC Isn’t So Sure In its holiday report, PwC said the season will be more like jazz—improvisational and less predictable—than an easy-to-follow melody.
MajorsSep 18, 2025
Pandora to Open New Distribution Center in MarylandThe jewelry giant will relocate its existing facility to a larger space in Anne Arundel.
Brought to you by
reDollar.com Is Rolling Out the Next Level Jewelry, Diamond & Watch Consignment ProgramWith their unmatched services and low fees, reDollar.com is challenging some big names in the online consignment world.
CollectionsSep 18, 2025
Ashley Zhang Launches Garçon New YorkThe designer, who is the creative force behind her namesake brand, has now started a new mini line focusing on chains for fathers and sons.
Weekly QuizSep 12, 2025
This Week’s QuizTest your jewelry news knowledge by answering these questions.
TechnologySep 18, 2025
Hill & Co. Launches AI Strategy ProgramThe 21-day program was designed to help jewelry retailers identify opportunities and eliminate inefficiencies with AI.
AuctionsSep 17, 2025
Mythical Set of Patek Philippe Pocket Watches Expected to Sell for $10M+A set of four Patek Philippe “Star Caliber 2000” pocket watches is part of Sotheby’s upcoming auction in Abu Dhabi.
Brought to you by
Rallying Call for the Jewelry Industry on Tariffs and Other Key IssuesJewelers of America is leading the charge to protect the industry amidst rising economic threats.
TrendsSep 17, 2025
Silvia Furmanovich’s Book Tells the ‘Journey of a Jeweler’The Brazilian jeweler’s latest book marks her namesake brand’s 25th anniversary and tells the tale of her worldwide collaborations.
WatchesSep 17, 2025
Bob’s Watches Acquires Vintage Rolex Won on ‘The Price is Right’ The Submariner Ref. 1680 with a Tiffany & Co. dial came from the original owner, who won it as a prize on the game show in the 1970s.
TechnologySep 17, 2025
Jewelers Mutual Launches Shipping Solution App for Shopify The new integration allows users to manage shipments directly from the Shopify dashboard.
EditorsSep 16, 2025
Out & About: 7 Great Quotes From Converge in CarlsbadAt Converge 2025, Editor-in-Chief Michelle Graff attended sessions on DEI, tariffs, security, and more. Here are her top takeaways.
CrimeSep 16, 2025
2 Robbery Suspects Killed in California Pawn Shop ShootoutSix people were shot last week at an Oakland cash-for-gold shop as employees exchanged gunfire with individuals trying to rob the store.
CollectionsSep 16, 2025
Chopard Adds New Designs to Its ‘Ice Cube’ Capsule CollectionThe jeweler has expanded its high jewelry offering, which launched last year, with new pieces featuring its cube motif that debuted in 1999.
EditorsSep 15, 2025
Skipping the Necklace, Embracing Snakes: The Best Jewelry From the 2025 Emmy AwardsAssociate Editor Natalie Francisco shares eight of her favorite jewelry looks from the 77th annual Primetime Emmy Awards, held Sunday night.
SurveysSep 15, 2025
Resilient Shoppers to Boost Holiday Retail Sales, Says DeloitteIt’s predicting a rise in retail sales this holiday season despite economic uncertainty and elevated inflation.
SourcingSep 15, 2025
Gemfields Achieves $32M at High-Quality Emerald AuctionIt included the sale of the 11,685-carat “Imboo” emerald that was recently discovered at Kagem.
SourcingSep 15, 2025
AGTA Elects 8 Members to Board of Directors The newly elected directors will officially take office in February 2026 and will be introduced at the organization’s membership meeting.
EditorsSep 12, 2025
Out & About: Mining Sapphires in Rock Creek, MontanaAssociate Editor Lauren McLemore headed out West for a visit to Potentate Mining’s operation hosted by gemstone wholesaler Parlé Gems.
TrendsSep 12, 2025
Piece of the Week: Arunashi’s Fordite and Rhodolite EarringsFordite is a man-made material created from the layers of dried enamel paint that dripped onto the floors of automotive factories.
Events & AwardsSep 12, 2025
Al Gilbertson Wins 2025 Robert M. Shipley AwardGilbertson has worked as a researcher, jeweler, lapidary artist, appraiser, and business owner throughout his decades in the industry.
Policies & IssuesSep 11, 2025
Supreme Court to Hear Tariffs Case in November A decision likely won’t come until January 2026 at the earliest, and the tariffs remain in effect until then.
MajorsSep 11, 2025
Tabayer Opens Nordstrom Shop-In-ShopLocated in the revamped jewelry hall at the retailer’s New York City flagship, this opening is Tabayer’s first shop-in-shop.
SourcingSep 11, 2025
Need to Sell More Natural Diamonds? De Beers Has an App for ThatThe new, free app offers accessible educational content, like games and podcasts, for U.S. retailers.
MajorsSep 10, 2025
Stuller to Swap Gold Scrap for Full Credit to AccountAs the gold price rises, the manufacturer is offering a 100 percent payout through Sept. 30 for gold clean scrap.
SourcingSep 10, 2025
Tech Meets Style in the New Loewe x Jacob & Co. HeadphonesJacob & Co. partnered with the German technology company on two pairs of headphones, one set with diamonds and the other with sapphires.
TrendsSep 10, 2025
Tiffany & Co. Archival Jewels Bring Life to ‘Frankenstein’Guillermo del Toro’s 2025 “Frankenstein” will feature 27 jewels and objects from the storied brand, including pieces from its archives.
