De Beers Group’s latest Diamond Insight Report found that global consumer demand for diamond jewellery fell 2 per cent in US dollar terms, from US$81 billion (AU$106.5 b) in 2014 to US$79 billion (AU$103.9 b) last year. This was said to be due to the negative impact of the strong US dollar. In constant currency terms, global jewellery demand increased 2 per cent.
In an interview, De Beers chief executive Philippe Mellier said it was important to note that 2014 was a record year, so even with a slight decrease in sales, diamond jewellery was “still a very impressive market” and 2015 demand had still been “very strong”.
The US maintained its position as the world’s largest market for diamond jewellery sales, reaching a record level of US$39 billion (AU$51.3 b) in 2015, up 5 per cent on the previous year. Furthermore, the US market increased its share of global polished diamond demand from 42 per cent to 45 per cent.
The region’s success was attributed to sustained economic recovery, higher levels of job creation and increased wages.
Chinese demand, including purchases made by Chinese customers while abroad, also increased 3 per cent in local currency. Mellier said the market was less stable in 2015 compared with 2014 due to protests and the anti-corruption movement, but that this was offset by an increase in the number of Chinese customers purchasing diamond jewellery in other markets, such as Australia.
Weak markets
Most other regions recorded flat or declining demand. Demand in India fell 4 per cent in local currency and decreased 9 per cent in US dollar terms; Japan demand was flat in local currency but dropped 13 per cent in US dollar terms; demand in the Gulf region fell 3 per cent in US dollars terms; and demand across all other markets combined – a segment termed ‘Rest of the World’ – fell 13 per cent in US dollar terms.
“There remains a positive medium to long-term outlook for diamond jewellery demand, driven by the US and the growth of the middle classes in emerging markets,” Mellier stated.
According to the report, 2016 was expected to experience “steady but subdued global economic growth, with weakening growth in emerging markets and a fragile recovery in the advanced economies”.
However, the report added, “…we [De Beers] continue to take a cautious approach in light of the fragile macroeconomic environment.”
The report can be accessed via www.debeersgroup.com.
More reading
Diamond jewellery sales exceed $100 billion
Global diamond jewellery demand sets new record
Diamond jewellery demand reaches record high