Diplomatic World_nummer 57

© AWDC
You are travelling all over the world to compose
a thorough view of your business. Do you see
certain evolutions that could affect the position
of stakeholders in the global diamond business?
Perhaps the best way to address this is to look at market
developments. Globally, diamond demand should grow
at approximately 3%, based on trends in the U.S., China
and globally. The United States market continues to be the
bedrock of global diamond demand, representing nearly
50% of the market. In this regard alone, we should have
reason to feel confident about the strength of the market.
US consumer confidence hit an 18-year high just a couple
months ago, reflecting its stable economic environment.
And the dollar has trended down, making diamonds
cheaper to import and to purchase. Statistics from the US
show that jewelry demand as a whole rose by about 7%
from 2016 to 2017. We just have to make sure that they are
buying diamond jewelry.
this lowers the barrier to a repeat purchase. So, sales might
rise, but I worry that margins could stagnate, particularly if
rough prices remain high, and every indication is that they
will, as we are gradually heading toward a scenario where
demand will outstrip supply. We have seen polished prices
increasing in 2018, but De Beers, for instance, has also
raised their rough prices to match. This makes it tough on
our market.
Concerning the large and upcoming markets, Greater
China’s consumer demand for diamonds is now about 20%
of global demand and is clearly on the rise. The economic
downturn of 2015 seems to be in the rear-view mirror.
The market’s largest jeweler, Chow Tai Fook, has seen
several consecutive quarters of sales growth, and the other
major retailers have experienced the same. The sheer fact
of middle-class population growth in Mainland China
and India will continue to be a consistent driver of global
demand.
The fears that millennials are no longer interested in
diamonds have really been calmed by the facts and figures
from the major diamond retailers. They are still buying
diamonds whether they are getting married or not. The
one negative is the trend for purchasing smaller goods,
which is spreading beyond the US and into China. Then
again, once consumers have acquired their first diamond,
AWDC has been a pioneer related to stress the
importance of a global sustainable diamond
business environment and create the necessary
tools to manage this sustainable process. How do
you see the future of ethics, audit processing and
certification schemes – like the Kimberley Process
Certification Scheme – evolve?
73