In a podcast released at the beginning of 2025, Rapaport Senior Analyst Joshua Freedman analyses the challenges and expectations of the diamond market.
2024 was a year of challenges for the diamond sector, with one of the main issues being inventory management. Despite the reduction in purchases following the 2023 crisis, stocks remain at far too high a level.
Secondly, diamond traceability has improved, boosted by European restrictions on Russian diamonds and G7 sanctions. However, although these initiatives have increased transparency, there remains little consumer interest in the origin of diamonds, as shown by the expert round table organized by RapNet during the JCK Las Vegas in June 2024. Natural Diamond Council CEO David Kellie argues that this lack of interest does not mean that the issue is unimportant, but that customers have not yet embraced this new mindset. In this respect, brands are clearly ahead of consumer expectations.
In terms of how the market is evolving, 2024 revealed a change in how lab-grown diamonds are perceived. Their rapid decline in value has led to a slight revival of interest in natural diamonds. Some retailers reported that sales had stabilized or even improved slightly, but margins on lab-grown diamonds have been disappointing and continue to narrow. De Beers and major retailers in China and India have invested in marketing campaigns to revive demand, but these actions will only bear fruit in the medium term. Competition from lab-grown diamonds remains strong, and their presence on the market continues to influence price dynamics.
Several key trends emerge for 2025
Let’s touch on these three key issues again.
Firstly, inventory management. The festive season showed some resilience, with sales up 4% in the US according to Mastercard Spending Pulse. This could ease the pressure on stocks at the start of the year.
When it comes to traceability, March 1 will see the mandatory introduction of a certificate of origin for diamonds entering the EU.
Finally, in response to the rise of lab-grown diamonds, the industry is planning to set up a new fund to finance promotional initiatives, supported by manufacturers and retailers. The spirit of this initiative is to encourage all market actors to play their part in this collective effort, with the aim of boosting the appeal of natural diamonds and revitalizing the market.
2025 promises to be decisive for the industry, with challenges to be met and strategies to be refined to ensure the long-term future of the natural diamond sector.
Source: Rapaport Market Comment
