Mon. Jun 17th, 2024

Are diamonds still forever, or are falling prices causing the precious stones to lose their shine?<!-- wp:html --><p><a href="https://whatsnew2day.com/">WhatsNew2Day - Latest News And Breaking Headlines</a></p> <div> <p class="paragraph_paragraph___QITb">From Greek mythology to Marilyn Monroe’s Hollywood to the clever marketing of De Beers, diamonds have long been coveted.</p> <p class="paragraph_paragraph___QITb">But the shiny stones have recently lost their shine as prices have plummeted.</p> <p class="paragraph_paragraph___QITb">“The current weakness in natural diamond prices is primarily a correction, following what I would characterize as the record price increases we have seen in 2021 and 2022,” said Paul Zimnisky, an independent diamond analyst based in New York.</p> <p class="paragraph_paragraph___QITb">When COVID stopped the world from enjoying experiences, those who could afford them went shopping.</p> <p class="paragraph_paragraph___QITb">This demand has driven up diamond prices.</p> <p class="paragraph_paragraph___QITb">“All the moons were pretty much aligned for diamonds, and it was a really strong time,” Mr. Zimnisky said.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“Nearly all categories of natural diamonds have experienced a parabolic upward trend, due to supply shortages, following stimulus measures, primarily in the United States, during the pandemic.”</p> </div> <p class="paragraph_paragraph___QITb">Prices for a one-carat-sized natural white diamond rose 5.8% in calendar year 2020, then climbed 17.4% in 2021, according to the RapNet Global Diamond Index (RAPI) .</p> <p class="paragraph_paragraph___QITb">“Now we’re on the other side…we’re experiencing a demand shock in the other direction,” Mr. Zimnisky told The Business.</p> <p> <!-- -->The slogan “Diamonds Are Forever” was coined by De Beers in the post-war jewelry industry.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Provided</span>)</span></span></p> <p class="paragraph_paragraph___QITb">Prices began to plunge in 2022, with the RAPI erasing 10.7% for a one-carat stone that year.</p> <p class="paragraph_paragraph___QITb">This year has been much worse.</p> <p class="paragraph_paragraph___QITb">Between January 1 and November 1, the price of a one-carat diamond fell twice compared to last year, erasing 21.3 percent.</p> <p class="paragraph_paragraph___QITb">In total, the price of a one-carat diamond has fallen 32 percent in less than two years.</p> <p class="paragraph_paragraph___QITb">For a half-carat stone, prices have fallen by almost 40 percent.</p> <h2 class="Typography_base__sj2RP Heading_heading__VGa5B Typography_sizeMobile20__NUDn4 Typography_sizeDesktop32__LR_G6 Typography_lineHeightMobile24__crkfh Typography_lineHeightDesktop40__BuoRf Typography_marginBottomMobileSmall__6wx7m Typography_marginBottomDesktopSmall__CboX4 Typography_black__9qnZ1 Typography_colourInherit__dfnUx Typography_normalise__u5o1s">Diamond Price Falls as Interest Rates Rise</h2> <p class="paragraph_paragraph___QITb">Interest rate hikes by central banks aimed at curbing rising inflation have been a key driver of the price fall.</p> <p class="paragraph_paragraph___QITb">“Diamond prices have responded as the fundamental situation has changed,” Mr. Zimnisky said.</p> <p class="paragraph_paragraph___QITb">The correction began just as central banks began raising rates.</p> <p class="paragraph_paragraph___QITb">“Diamond prices are certainly strongly correlated with GDP growth,” added Mr. Zimnisky, a former Wall Street analyst.</p> <p> <!-- -->Prices for one-carat white diamonds have fallen 30 percent over the past two years.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Supplied: Rohan Jewelers</span>)</span></span></p> <p class="paragraph_paragraph___QITb">Perth-based jeweler Rohan Milne has been experiencing the decline in diamonds and while he said there had been “significant declines here”, the fall in prices was not as severe as in the UNITED STATES.</p> <p class="paragraph_paragraph___QITb">“They’ve seen a potential decline of over 20 percent or more, but I think here we’re probably not seeing that big of a price swing just because the Australian dollar has kind of cushioned some of the that,” Mr Milne said. told The Business.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“When the Australian dollar falls, at the same rate as, for example, the price of white diamonds in US dollars, we don’t see that big fluctuation because we’re still buying it in US dollars – so it sometimes keeps pace.</p> </div> <p class="paragraph_paragraph___QITb">“This has always been the case with gold.”</p> <p> <!-- -->Perth jeweler Rohan Milne has witnessed the effects of the diamond decline first-hand.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Supplied: Rohan Jewelers</span>)</span></span></p> <h2 class="Typography_base__sj2RP Heading_heading__VGa5B Typography_sizeMobile20__NUDn4 Typography_sizeDesktop32__LR_G6 Typography_lineHeightMobile24__crkfh Typography_lineHeightDesktop40__BuoRf Typography_marginBottomMobileSmall__6wx7m Typography_marginBottomDesktopSmall__CboX4 Typography_black__9qnZ1 Typography_colourInherit__dfnUx Typography_normalise__u5o1s">The laboratory effect</h2> <p class="paragraph_paragraph___QITb">The flight to affordability has been a feature of the diamond market for years, and this has seen the rise of lab-grown diamonds, also known as synthetic diamonds.</p> <p class="paragraph_paragraph___QITb">In 2018, the world’s largest diamond trader, De Beers, announced it would begin selling the manufactured stones.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“The market has been quite surprised that this company has been spearheading, nurturing and promoting natural diamonds, and yet has a spinoff of synthetic diamonds,” said diamond consultant John Chapman.</p> </div> <p> <!-- -->Diamond expert, John Chapman has been working with precious stones since the 1980s.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<!-- --><br /> <span>ABC News: Rachel Pupazzoni</span><br /> <!-- -->)</span></span></p> <p class="paragraph_paragraph___QITb">Mr Chapman is a diamond physicist and analyst, who worked for Australian diamond company Argyle and is now recognized worldwide for his expertise in gemstones.</p> <p class="paragraph_paragraph___QITb">Mined, or natural, diamonds were made under extreme pressure in the Earth’s core, sent to the surface by a volcano hundreds of millions of years ago (or in the case of the Argyle diamond mine , in northern Western Australia, 1.3 billion years ago). buried beneath the surface of the earth then extracted from the ground by miners.</p> <p class="paragraph_paragraph___QITb">Synthetic diamonds can be made in just a few days – and to the untrained eye, it’s almost impossible to tell the difference.</p> <p class="paragraph_paragraph___QITb">Mr Chapman said the growing popularity of synthetic stones, bought at a much more competitive price, had also had an impact on the price of natural stones.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“It’s fascinating for a consumer to be able to have something on their finger or in their ears, which to the naked eye, or even with an assisted eye, cannot tell the difference. So that’s what it’s all about that the industry is facing.</p> </div> <p> <!-- -->Lab-grown diamonds are produced from a seed and are almost impossible to differentiate by the untrained eye.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Supplied: De Beers</span>)</span></span></p> <p class="paragraph_paragraph___QITb">Mr Chapman said the marketing juggernaut that is the entry of De Beers – the company which conceived the concept of spending two months’ salary on a diamond ring – into manufactured diamonds may have been another ploy marketing.</p> <p class="paragraph_paragraph___QITb">“There are some thoughts about their strategy, because they were quite cheap, even for synthetics, they were on the low end,” he explained.</p> <p class="paragraph_paragraph___QITb">“There was speculation that this was a strategy to weaken all other producers who would have to match their prices and, therefore, probably go bankrupt – and therefore it could have been a way of destroying the synthetic market.”</p> <p class="paragraph_paragraph___QITb">Whether these speculations are true or not, the prices of synthetic diamonds have indeed collapsed.</p> <p class="paragraph_paragraph___QITb">Mr. Zimnisky’s data shows that in 2016, a one-carat lab-grown white diamond cost $5,450, compared to a one-carat natural diamond that sold for an average of $6,538.</p> <p class="paragraph_paragraph___QITb">This price difference has now widened significantly.</p> <p class="paragraph_paragraph___QITb">In 2023, a one-carat lab-grown white diamond cost $1,355, while a natural diamond sells for an average of $4,726.</p> <p class="paragraph_paragraph___QITb">“The price gap between natural and artificial diamonds is so great that the products are starting to attract different customers,” he said.</p> <p class="paragraph_paragraph___QITb">De Beers has now exited the synthetic diamond engagement ring market.</p> <p> <!-- -->Diamonds and gold are traded in US dollars.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Supplied: Rohan Jewelers</span>)</span></span></p> <h2 class="Typography_base__sj2RP Heading_heading__VGa5B Typography_sizeMobile20__NUDn4 Typography_sizeDesktop32__LR_G6 Typography_lineHeightMobile24__crkfh Typography_lineHeightDesktop40__BuoRf Typography_marginBottomMobileSmall__6wx7m Typography_marginBottomDesktopSmall__CboX4 Typography_black__9qnZ1 Typography_colourInherit__dfnUx Typography_normalise__u5o1s">A league of its own</h2> <p class="paragraph_paragraph___QITb">In the midst of a recession, there is a segment of the market that is defying the trend because it is an industry that few people can afford to be in.</p> <p class="paragraph_paragraph___QITb">Pink diamonds from Rio Tinto’s now-closed Argyle diamond mine in the Kimberley continue to fetch higher prices.</p> <p class="paragraph_paragraph___QITb">“Back in the day, when they were actually producing, they said they would produce a handful of cut roses each year,” Mr Milne said.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“It’s rare within rarity, no matter what, so you can start to understand why they cost so much.”</p> </div> <p class="paragraph_paragraph___QITb">The Argyle diamond mine accounted for more than 90 percent of the world’s supply of pink diamonds during its nearly 40 years of operation.</p> <p class="paragraph_paragraph___QITb">But less than 1% of the diamonds mined at Argyle were pink.</p> <p class="paragraph_paragraph___QITb">Two years ago, Rio Tinto announced the final tender for the most prized pink diamonds, a year after the mine closed.</p> <p class="paragraph_paragraph___QITb">But last month it surprised the market by announcing a new tender, with 87 Argyle pink diamonds, weighing 29.96 carats, as well as two yellow diamonds from its Diavik mine in Canada.</p> <p class="paragraph_paragraph___QITb">Mr Milne was one of around 80 jewelers and workshops from around the world invited to bid in this year’s tender.</p> <p class="paragraph_paragraph___QITb">It’s actually a silent auction, in which those invited to participate are given about an hour to view diamonds in just four locations around the world, and then make their bid, without knowing any other auctions.</p> <p class="paragraph_paragraph___QITb">This bidding process closed this week, but secrecy surrounding the process remains, as the winning bids are never publicly revealed.</p> <p> <!-- -->Rio Tinto’s exclusive tender includes collections like these five brilliant-cut stones, mined from the now-closed Argyle Mine.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Provided: Rio Tinto</span>)</span></span></p> <p class="paragraph_paragraph___QITb">Heidi Creech, sales and business development manager at Rio Tinto Diamond, said the stones on offer are “in a league of their own”.</p> <p class="paragraph_paragraph___QITb">“In the past we’ve seen Argyle pink diamonds in particular really defy the ebb and flow of economic cycles,” Ms Creech told The Business.</p> <p class="paragraph_paragraph___QITb">“They have outperformed the share market year on year for many years and, although the economic situation is difficult at the moment, we still expect strong bidding for this event,” she added.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“For pink Argyle diamonds for example, we’ve seen those sell for millions of dollars per carat.”</p> </div> <p> <!-- -->These teardrop-shaped pink Argyle diamonds are part of Rio Tinto’s final tender.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Provided: Rio Tinto</span>)</span></span></p> <h2 class="Typography_base__sj2RP Heading_heading__VGa5B Typography_sizeMobile20__NUDn4 Typography_sizeDesktop32__LR_G6 Typography_lineHeightMobile24__crkfh Typography_lineHeightDesktop40__BuoRf Typography_marginBottomMobileSmall__6wx7m Typography_marginBottomDesktopSmall__CboX4 Typography_black__9qnZ1 Typography_colourInherit__dfnUx Typography_normalise__u5o1s">Will scarcity reign supreme?</h2> <p class="paragraph_paragraph___QITb">Proponents of the diamond market say it is this element of scarcity that will allow prices of natural white diamonds to rise relative to their synthetic counterparts.</p> <p class="paragraph_paragraph___QITb">Last year, 120 million carats of rough diamonds were mined worldwide, but this figure is expected to decline over time as mines close.</p> <p class="paragraph_paragraph___QITb">“There are quite a few mines like those of Rio Tinto in Canada, I think they have three or five years left, there are many other mines, which must also come to an end,” declared Mr. Chapman.</p> <p class="paragraph_paragraph___QITb">“There are no new mines on the horizon, and even if there were, it would still be a good ten years before they would be in production,” he added.</p> <p> <!-- -->Rio Tinto’s Diavik diamond mine in Canada is expected to produce diamonds until early 2026.<span class="Typography_base__sj2RP VerticalArticleFigcaption_citation__l7wgU Typography_sizeMobile12__w_FPC Typography_lineHeightMobile24__crkfh Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil"><span class="Typography_base__sj2RP Typography_sizeMobile12__w_FPC Typography_lineHeightMobile20___U7Vr Typography_regular__WeIG6 Typography_colourInherit__dfnUx Typography_letterSpacedSm__V8kil">(<span>Provided: Rio Tinto</span>)</span></span></p> <p class="paragraph_paragraph___QITb">Mr Milne noted that supply is starting to be curbed, which will add to fears of lack of psychology among consumers.</p> <div class="EmphasisedText_emphasisedText__h0tpv ContentAlignment_marginBottom__4H_6E ContentAlignment_overflowAuto__c1_IL"> <p class="paragraph_paragraph___QITb">“I have spoken to people in the rough (diamond) sector and the changes they are making to ensure that the white diamond market will be consistent in its prices,” he said.</p> </div> <p class="paragraph_paragraph___QITb">“They are likely to wait for some of the rough to reach the cutters, which means there will be less goods coming back into the market.</p> <p class="paragraph_paragraph___QITb">“So, much like OPEC maybe cutting back some of its oil production, I would expect the natural diamond market to stabilize.”</p> <p class="paragraph_paragraph___QITb">Only time will tell if the famous De Beers motto “a diamond is forever” will ring true again.</p> </div> <p><a href="https://whatsnew2day.com/are-diamonds-still-forever-or-are-falling-prices-causing-the-precious-stones-to-lose-their-shine/">Are diamonds still forever, or are falling prices causing the precious stones to lose their shine?</a></p><!-- /wp:html -->

WhatsNew2Day – Latest News And Breaking Headlines

From Greek mythology to Marilyn Monroe’s Hollywood to the clever marketing of De Beers, diamonds have long been coveted.

But the shiny stones have recently lost their shine as prices have plummeted.

“The current weakness in natural diamond prices is primarily a correction, following what I would characterize as the record price increases we have seen in 2021 and 2022,” said Paul Zimnisky, an independent diamond analyst based in New York.

When COVID stopped the world from enjoying experiences, those who could afford them went shopping.

This demand has driven up diamond prices.

“All the moons were pretty much aligned for diamonds, and it was a really strong time,” Mr. Zimnisky said.

“Nearly all categories of natural diamonds have experienced a parabolic upward trend, due to supply shortages, following stimulus measures, primarily in the United States, during the pandemic.”

Prices for a one-carat-sized natural white diamond rose 5.8% in calendar year 2020, then climbed 17.4% in 2021, according to the RapNet Global Diamond Index (RAPI) .

“Now we’re on the other side…we’re experiencing a demand shock in the other direction,” Mr. Zimnisky told The Business.

The slogan “Diamonds Are Forever” was coined by De Beers in the post-war jewelry industry.(Provided)

Prices began to plunge in 2022, with the RAPI erasing 10.7% for a one-carat stone that year.

This year has been much worse.

Between January 1 and November 1, the price of a one-carat diamond fell twice compared to last year, erasing 21.3 percent.

In total, the price of a one-carat diamond has fallen 32 percent in less than two years.

For a half-carat stone, prices have fallen by almost 40 percent.

Diamond Price Falls as Interest Rates Rise

Interest rate hikes by central banks aimed at curbing rising inflation have been a key driver of the price fall.

“Diamond prices have responded as the fundamental situation has changed,” Mr. Zimnisky said.

The correction began just as central banks began raising rates.

“Diamond prices are certainly strongly correlated with GDP growth,” added Mr. Zimnisky, a former Wall Street analyst.

Prices for one-carat white diamonds have fallen 30 percent over the past two years.(Supplied: Rohan Jewelers)

Perth-based jeweler Rohan Milne has been experiencing the decline in diamonds and while he said there had been “significant declines here”, the fall in prices was not as severe as in the UNITED STATES.

“They’ve seen a potential decline of over 20 percent or more, but I think here we’re probably not seeing that big of a price swing just because the Australian dollar has kind of cushioned some of the that,” Mr Milne said. told The Business.

“When the Australian dollar falls, at the same rate as, for example, the price of white diamonds in US dollars, we don’t see that big fluctuation because we’re still buying it in US dollars – so it sometimes keeps pace.

“This has always been the case with gold.”

Perth jeweler Rohan Milne has witnessed the effects of the diamond decline first-hand.(Supplied: Rohan Jewelers)

The laboratory effect

The flight to affordability has been a feature of the diamond market for years, and this has seen the rise of lab-grown diamonds, also known as synthetic diamonds.

In 2018, the world’s largest diamond trader, De Beers, announced it would begin selling the manufactured stones.

“The market has been quite surprised that this company has been spearheading, nurturing and promoting natural diamonds, and yet has a spinoff of synthetic diamonds,” said diamond consultant John Chapman.

Diamond expert, John Chapman has been working with precious stones since the 1980s.(
ABC News: Rachel Pupazzoni
)

Mr Chapman is a diamond physicist and analyst, who worked for Australian diamond company Argyle and is now recognized worldwide for his expertise in gemstones.

Mined, or natural, diamonds were made under extreme pressure in the Earth’s core, sent to the surface by a volcano hundreds of millions of years ago (or in the case of the Argyle diamond mine , in northern Western Australia, 1.3 billion years ago). buried beneath the surface of the earth then extracted from the ground by miners.

Synthetic diamonds can be made in just a few days – and to the untrained eye, it’s almost impossible to tell the difference.

Mr Chapman said the growing popularity of synthetic stones, bought at a much more competitive price, had also had an impact on the price of natural stones.

“It’s fascinating for a consumer to be able to have something on their finger or in their ears, which to the naked eye, or even with an assisted eye, cannot tell the difference. So that’s what it’s all about that the industry is facing.

Lab-grown diamonds are produced from a seed and are almost impossible to differentiate by the untrained eye.(Supplied: De Beers)

Mr Chapman said the marketing juggernaut that is the entry of De Beers – the company which conceived the concept of spending two months’ salary on a diamond ring – into manufactured diamonds may have been another ploy marketing.

“There are some thoughts about their strategy, because they were quite cheap, even for synthetics, they were on the low end,” he explained.

“There was speculation that this was a strategy to weaken all other producers who would have to match their prices and, therefore, probably go bankrupt – and therefore it could have been a way of destroying the synthetic market.”

Whether these speculations are true or not, the prices of synthetic diamonds have indeed collapsed.

Mr. Zimnisky’s data shows that in 2016, a one-carat lab-grown white diamond cost $5,450, compared to a one-carat natural diamond that sold for an average of $6,538.

This price difference has now widened significantly.

In 2023, a one-carat lab-grown white diamond cost $1,355, while a natural diamond sells for an average of $4,726.

“The price gap between natural and artificial diamonds is so great that the products are starting to attract different customers,” he said.

De Beers has now exited the synthetic diamond engagement ring market.

Diamonds and gold are traded in US dollars.(Supplied: Rohan Jewelers)

A league of its own

In the midst of a recession, there is a segment of the market that is defying the trend because it is an industry that few people can afford to be in.

Pink diamonds from Rio Tinto’s now-closed Argyle diamond mine in the Kimberley continue to fetch higher prices.

“Back in the day, when they were actually producing, they said they would produce a handful of cut roses each year,” Mr Milne said.

“It’s rare within rarity, no matter what, so you can start to understand why they cost so much.”

The Argyle diamond mine accounted for more than 90 percent of the world’s supply of pink diamonds during its nearly 40 years of operation.

But less than 1% of the diamonds mined at Argyle were pink.

Two years ago, Rio Tinto announced the final tender for the most prized pink diamonds, a year after the mine closed.

But last month it surprised the market by announcing a new tender, with 87 Argyle pink diamonds, weighing 29.96 carats, as well as two yellow diamonds from its Diavik mine in Canada.

Mr Milne was one of around 80 jewelers and workshops from around the world invited to bid in this year’s tender.

It’s actually a silent auction, in which those invited to participate are given about an hour to view diamonds in just four locations around the world, and then make their bid, without knowing any other auctions.

This bidding process closed this week, but secrecy surrounding the process remains, as the winning bids are never publicly revealed.

Rio Tinto’s exclusive tender includes collections like these five brilliant-cut stones, mined from the now-closed Argyle Mine.(Provided: Rio Tinto)

Heidi Creech, sales and business development manager at Rio Tinto Diamond, said the stones on offer are “in a league of their own”.

“In the past we’ve seen Argyle pink diamonds in particular really defy the ebb and flow of economic cycles,” Ms Creech told The Business.

“They have outperformed the share market year on year for many years and, although the economic situation is difficult at the moment, we still expect strong bidding for this event,” she added.

“For pink Argyle diamonds for example, we’ve seen those sell for millions of dollars per carat.”

These teardrop-shaped pink Argyle diamonds are part of Rio Tinto’s final tender.(Provided: Rio Tinto)

Will scarcity reign supreme?

Proponents of the diamond market say it is this element of scarcity that will allow prices of natural white diamonds to rise relative to their synthetic counterparts.

Last year, 120 million carats of rough diamonds were mined worldwide, but this figure is expected to decline over time as mines close.

“There are quite a few mines like those of Rio Tinto in Canada, I think they have three or five years left, there are many other mines, which must also come to an end,” declared Mr. Chapman.

“There are no new mines on the horizon, and even if there were, it would still be a good ten years before they would be in production,” he added.

Rio Tinto’s Diavik diamond mine in Canada is expected to produce diamonds until early 2026.(Provided: Rio Tinto)

Mr Milne noted that supply is starting to be curbed, which will add to fears of lack of psychology among consumers.

“I have spoken to people in the rough (diamond) sector and the changes they are making to ensure that the white diamond market will be consistent in its prices,” he said.

“They are likely to wait for some of the rough to reach the cutters, which means there will be less goods coming back into the market.

“So, much like OPEC maybe cutting back some of its oil production, I would expect the natural diamond market to stabilize.”

Only time will tell if the famous De Beers motto “a diamond is forever” will ring true again.

Are diamonds still forever, or are falling prices causing the precious stones to lose their shine?

By