DIAMOND PRODUCTION TODAY

The History of Diamond Production: Global: Diamonds Production Today

Although diamonds are the most plentiful they’ve ever been, with annual production estimated at 160 million carats—twice what it was 20 years ago—the market is encouragingly stable and very absorbent.

From a mining standpoint, the De Beers monopoly is the most trim it has ever been, controlling, by its own estimates, 50% to 60% of total world output. Many see in this leaner, meaner monopoly signs of its immanent demise—and, with it, the collapse of artificially maintained diamond prices. What these critics forget is that the market doesn’t need iron-fisted cartel control as much as it once did.

First of all, production is centered in places where there is extraordinary social and economic stability. Canada, Russia and Australia have a firm grip on production and seem inclined to cooperate when it comes to combating volatility factors. Never forget also that nearly all diamonds come from expensive underground mining operations which pretty much leave the game in very strong corporate hands—all of them intent on self-interested maintenance of an orderly market. So while there is fierce competition for goods among cutters, the miners seem cooperative.

Second, as industrialization sweeps across Eastern Europe into central and southeast Asia, there is an emerging global market for diamonds that no longer leaves this gem a captive of economic conditions in a handful of consuming nations like America and Japan. Unless the world plunges into global recession, diamond demand is now so far-flung and multi-marketed that it is able to compensate for weakness in one place with strength in another.

It is this global market that is democratizing diamond demand—and, with it, diamond supply. The expansive future of diamond production is matched by an equally expansive future of diamond desire.