Global diamond jewellery demand rose by 3% to exceed $80 billion (£51bn) for the first time in 2014, according to the Diamond Insight Report published today by the De Beers Group of Companies.
This represents the fifth year of consecutive growth since the global recession. Global rough diamond production rose by 6% to $19 billion (£12bn).
Consumer demand in 2014 grew in each of the top five diamond consuming markets – the US, China, Japan, India and the Gulf – which accounts for 75% of global demand. The strength of the US dollar suppressed further global growth, which at constant exchange rates amounted to almost 5%.
Despite the strong performance in 2014, the report notes that the continued strength of the US dollar and lower demand growth in China is likely to mean that global growth (in US dollar terms) in 2015 will remain stable on 2014 levels.
While rough diamond production value increased in 2014, production volume actually decreased 3% to 142 million carats. According to the report, rough diamond demand is likely to be lower in 2015 as higher levels of stock in the midstream and downstream work through the system.
The report also reveals the extent of the opportunity presented by the growing economy and emerging middle class in India.
It found that, driven by a widening consumer base, economic development and increasing volumes, India’s diamond consumer market has achieved almost uninterrupted growth over the last 20 years. It is now one of the world’s largest consumer markets.
Philippe Mellier, chief executive officer, De Beers Group, says: “2014 saw strong levels of consumer demand across all key markets. Rough diamond demand was also strong in 2014, although we have seen more challenges in 2015. Indigestion in the midstream and downstream has impacted rough diamond demand this year, despite consumer demand for diamond jewellery being stable on the levels seen last year.
However, the challenges faced by the sector in 2015 are expected to be short-term and the industry has excellent prospects. The long-term trend for demand has been positive, with consistent growth in demand for diamond jewellery since the 2008/9 financial crisis. There are also further exciting growth opportunities in the main consumer markets and India is a great example of this. Already one of the world’s largest markets for diamond jewellery, the growth of the middle class in India over the next decade is set to make a major contribution to growing diamond demand.”