Global Diamond Prices Plummet. Is China to Blame?
With the marriage rate plummeting, China’s demand for natural diamonds has "sharply declined," while its factories are producing synthetic alternatives at prices as low as 90% less.
In today’s economic downturn, not all newlywed couples in China can afford branded natural diamonds. However, even more concerning is that many simply no longer desire them.
The prices of natural gemstones have fallen globally, damaging their ability to hold value, while synthetic gemstones, which are equally dazzling, come at a significantly lower cost.
Vivian Wu, the 40-year-old founder of Shanghai Diamond Trading Company, Weian Trading, states: “They don’t necessarily need Tiffany's products.”
Ms. Wu still completes around 10 diamond orders a week, as she has for years, but her clients are increasingly looking for bargains. Newlyweds are requesting smaller-sized gemstones to fit their reduced budgets, or opting for synthetic gemstones, which can cost as little as one-tenth of the price of natural gems.
The changes occurring in China are rapidly reshaping the global diamond market. Chinese consumers are no longer purchasing natural diamonds in bulk, while domestic factories are ramping up production of cheaper synthetic diamonds.
According to Bank of America Global Research, diamond wholesale prices have dropped by about 40% over the past two years. The Zimnisky rough diamond price index reveals a particularly sharp decline since diamonds hit a historic high in 2022.