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Round Diamond Prices Up 8.5% Already This Year

Rough_diamonds Even though there is a softening of the Unite States diamond retail market, prices of diamond are continuing up due to increases in rough diamond prices.  Prices for rough diamonds this year through the May De Beers sight distribution are up 8.5% overall and over 25% over the past 12 months.  However, most of the price increases were for high clarity and larger carat weights (those that will be finished to 2-carat weight).

One of the reasons that diamond prices is continuing to go higher is that the worldwide demand for diamond jewelry is still growing, thanks in part to an exploding Chinese jewelry market.

While the price increases for rough diamonds mean higher prices for consumers, it is the middle of the diamond distribution pipeline that are getting hurt the most.  The diamond cutters and wholesalers are often not able to pass on all of their cost increases and become susceptible to cash flow shortages.  For many of these diamond cutters, survival will depend on whether they can pass these cost increases to retailers and what financing support they can get from banks.


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