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From carats to peanuts: how pandemic collapsed global diamond industry

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Patel, who worked for a decade in India’s Surat where about 80% of the world’s diamonds are polished, joined the exodus of gem workers leaving the city as cases of the virus shot up.

COVID-19 has forced miners to cancel or delay sales, with major diamond shows scrapped due to health and travel restrictions. The few sales that have taken place showed rough diamond prices down between 15% and 27%. “What has happened in the second quarter, I have never seen in my life,” De Beers Chief Executive Bruce Cleaver told Reuters.

Antwerp, another diamond hub, saw rough imports drop 20% year-on-year in the first half, according to data from Antwerp World Diamond Centre. The city’s exports of polished diamonds fell 46%.In a bid to survive, some miners are trying to change the traditional pricing game by securing a cut of onward polished diamond sales, and miners may eventually have direct tie-ups with luxury jewellery brands, RCC Diamond Consultants managing director Richard Chetwode predicts.

“There is real opportunity within the diamond business as a whole to modernise the sales system,” said Lucara CEO Eira Thomas. Lucara has also set up an online diamond sales platform. In the meantime, miners are hoping production cuts will help prices recover. Several diamond mines shuttered due to the pandemic have also yet to reopen, including Stornoway Diamonds’ Renard mine in Canada, Petra Diamonds’ Williamson mine in Tanzania, and Firestone Diamonds’ Liqhobong mine in Lesotho, which the company said would likely stay closed until April to preserve cash.

 

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