2004

Polished Prices Start To Follow Rough Increases

May 2004

Polished prices are starting to follow the price increases by De Beers and other producers, and are beginning to move up, slowly but surely.

Certified better goods G – H in the carat and a half and above range are up by about 10% from the beginning of the year. In the caraters, they are up about 7 – 8%.

There is a shortage in goods two carats and above, which will put pressure on the prices of the larger sizes.

Is this good for the industry or not? We are not sure. Right now, the extra money is going to the mining companies (De Beers, Aber, etc) that are setting the rough prices rather than the diamond manufacturer or dealer. This leaves the diamond manufacturer between a (literal) rock and a hard place, especially since today mining companies want just not money for their goods but also added investment on branding and marketing initiatives.

On the other hand, there is the public. Are they willing to pay more, especially with the added costs of branding and marketing, or possibly buy a smaller diamond or a lower grade? That is something that will only be answered by time.

Some argue that the more a diamond costs, the more precious and desirable it will become. Others say if the price of natural diamonds gets too high, the synthetic alternative will become more popular. So far, it looks like people are willing to pay extra.

Certainly, those with the money are willing to pay. This can be seen in the latest auction results from Christies, which shows that people are still buying and on occasion buying larger diamonds. Simon Teakle, head of jewelry for Christie’s America, said after the April sale that “diamond prices were exceptionally strong with aggressive international private collectors and trade international buyers competing heavily in a market where important stones are extremely scarce.”