Margaux Donckier, spokesperson of the Antwerp World Diamond Center, told about the main trends in the diamond market in her interview to Rough&Polished.
What are the main trends in today’s diamond market?
At the moment, diamond demand worldwide and especially in countries such as China and India remains very high. As long as both the Chinese and Indian economies remain strong, the future looks bright. For now, the US remains the main consumer market for diamonds.
How do you assess rough diamond tenders?
The outlook for the Antwerp diamond market is positive. Antwerp is still the largest trading platform for rough diamonds. Thanks to the success of the Antwerp diamond tender facility (ATF), we will be able to strengthen our position even more in the future.
In its first fully operational year, the ATF was amply booked year round by various tendering parties. For both established producers, such as market leader ALROSA, and the so-called junior miners, the facility has clearly become a benchmark. It is the fastest, most efficient selling channel, ensuring optimal revenue for their production.
In addition, other companies like Fusion Alternatives & Hennig and Grib Diamonds also organize tenders in Antwerp. Just last September, Fusion Alternatives & Hennig held two tenders in Antwerp with goods from central and southern Africa, followed by a tender of goods from the KAO mine in Lesotho. Also in September, Grib Diamonds, a subsidiary of OAO LUKOIL auctioned goods from the diamond mine named after V. Grib in the region of Arkhangelsk.
What is your opinion on online diamonds and diamond jewelry trading?
As consumer needs and preferences are part of what drives AWDC, we follow online consumer and trading behavior closely. Although the diamond trade, like any other trade, is challenged by the increasing popularity of online purchasing, we have noticed that the majority of consumers still prefer real stores when it comes to buying diamond jewelry.
What do you think about synthetic diamonds? Are you concerned about the practice of mixing them with natural diamonds?
Synthetic diamonds are not a new product, having been produced since 1953, and they are mainly used in industrial applications, such as diamond grinding wheels, drill bits, etc. During the 90s, the quality of synthetic diamonds increased considerably, allowing them to be processed into jewelry. There is nothing wrong with that, but we do find that today’s consumers still prefer to buy authentic, natural diamonds. Moreover, the price difference between synthetic diamonds and natural diamonds is currently too small to convince consumers to purchase synthetic diamonds instead of natural diamonds.
Something we, of course, do not approve of, is synthetic diamonds being advertised as natural diamonds. Luckily, labs responsible for the certification of diamonds are able to tell within a few minutes whether or not a diamond is natural. That is why we recommend everyone who wants to buy natural diamond jewelry to only make a purchase if the jewelry comes with a certificate that conclusively establishes that the diamonds are natural.
Are you satisfied with the demand and the prices of diamonds?
Overall, we can say prices are strong, especially for rough diamonds. Over the past ten years, the average annual diamond production worldwide decreased from 160 million carats to a steady 128 million carats in the past three years. Over that same period of time, the average price per carat nearly tripled. In this highly competitive market, Antwerp clearly demonstrates its resilience as the most stable diamond-trading centre worldwide.
However, we must remain cautious when it comes to predictions, taking into account trade volumes as a second parameter for measuring economic growth. The Asian market is doing very well, America looks promising and Europe is slowly emerging from the crisis.
New initiatives in the polished market, such as the Manufacturers and Traders Fair at the Antwerp Diamond Bourse, make sure customers keep finding their way to Antwerp. Moreover, participants of the Antwerp Diamond Pavilion at the most recent trade fair in Hong Kong, reported to be very pleased with the fair.
Do you think it is a true message of UN experts that on the markets continue to flow diamonds from conflict zones?
Antwerp is the most transparent and controlled diamond trade centre worldwide. In Antwerp, 28,000 KP certificates are issued annually, which is about half of all Kimberley certificates issued worldwide. Thanks to the system of KP certificates, the proportion of conflict diamonds has been reduced from 15% to 0.2% in ten years’ time, unlike a great number of other minerals including gold and platinum, for which no verification system exists.
However, we are looking forward to the annual KP meeting, because we know it is important to always stay vigilant.
Do you expect changes in ALROSA's trading strategy?
At this moment, we have not noticed any signs of changes in ALROSA’s trading strategy. The political situation between Russia and Ukraine has calmed down, and the European Union has decided not to impose sanctions on the diamond industry.
Alex Shishlo, Editor in Chief of the European Bureau, Rough&Polished
