Diamond Prices Likely To Rise

Published on 07/01/11

The prices of both rough and polished diamonds are set to rise another 20-25 per cent in the coming year, despite higher production by De Beers, the world’s largest miner of the precious stone.

Due to less supply and rising demand from American and Asian markets on the back of economic recovery, the prices of rough diamonds (‘roughs’) have risen 50 per cent since July.

De Beers has moved to raise production; it estimated total rough output at 31 million carats in 2010 as against 24.6 million carats in the previous year. In 2011, the company proposes to raise this to 40 million carats.
Yet, the demand is ahead. “The demand is bullish from both domestic and overseas markets. Most important, the demand is not for inventory pile-up or pipelines but from retail consumers. Hence, we expect that both rough and polished prices will continue to move northward,” said Mehul Choksi, chairman of the Gitanjali Group.