“Archaeologists tell us that humans have been wearing jewellery for at least 50,000 years to denote wealth and their position in the community. The recession of 2008-09 isn’t going to derail 50,000 years of cultural affinity,” founder of the Jewelry Industry Research Institute in Virginia, Ken Gassman, told The Telegraph newspaper.
With half of all global diamond sales taking place in the US, industry experts are watching the American market avidly.
“We may well be at the bottom,” Gassman added, “but we haven’t turned. Polished diamond prices have been flat since April. Producers have tried to raise prices since then, but to no avail.”
‘Green shoots’ of recovery in the Diamond industry
Financial journalist Garry White at The Telegraph reported: ‘One important thing to remember about the jewellery industry is that, because of the discretionary nature of the spending and high ticket prices, it is one of the first sectors to enter a recession.
“It is also one of the last sectors to leave, so polished diamond process could be flat for some time. But there is no question that diamond industry players expect the market to recover – and the green shoots are promising enough for diamond miners to prepare for that day.”
Expansion work at the world’s largest single producer of diamonds, Argyle in Western, is due to restart next year. Rio Tinto will also be starting underground production in 2013 according to its chief operating officer, Kevin McLeish.
Russia’s Alrosa company went back to full production on September 1 and US giant Harry Winston is now cancelling a winter shutdown at its Diavik mine in Canada. De Beers, has also recorded an increase in sales with total sales of $400m (£246m) in the first quarter rising to $1.31bn in the second quarter.
Gassman told The Telegraph: “Historically, Americans revert to their prior shopping patterns after a recession. And one fact is irrefutable: Americans are born to spend.”
