I’ve been in diamond production on small to medium scale since June 1998, CEO on an alluvial diamond mine in South Africa. The more day I overheard someone state that he sought to good deal his wife a diamond ring, but fairly went for another gemstone as of the price. This amused me; know how to it be that diamonds are as a result costly in a store? The corresponding man turned to me and remarked

“You (meaning the producers) be supposed to be really delighted together with the the style the diamond assessment increased the concluding 5 years!”

I in a minute turned away and started talking round the weather, for the reason that we’re not happy, far from that!! You see, even if diamond prices has skyrocketed for the consumer in the ending 6-8 years, the producer has seen enormously hardly any increase in the rate we get! Different the diesel price, which was $0.23 in 1998 and we immediately disburse $1.52 in 2008 (that is a 565% increase), the diamond assessment stayed relatively stable for the producer.

Here’s an example:

In late 1999 we found a 22ct, I color, just about spotless diamond, which were sold in early 2000 for $5681.81/ct. At the birth of 2008 we create another 22.76ct, I color, just about spotless diamond (the shape was very soon as good, if not bigger than the one in 1999, and it was as matching for the reason that one could desire for, supreme for comparison). This diamond was sold in mid 2008 for $6533/ct.

That is an increase of 15% greater than 9 years. This isn’t good math for any business, and for this issue hundreds of medium sized mines had to adjoining their doors, or pits in this case. In turn, together with production going down, the consumer will compensate balanced larger than for this expensive stones.

Another factor, which kept the assessment low for the producer and high for the consumer, is the gold price. Any diamond producer know how to depict you that a high gold charge = low diamond significance for the producer, it’s an unwritten rule! I reckon it works similar to this: The marketplace needs jewelry in all shapes and sizes, diamond gold rings, diamond gold earrings, diamond gold watches etc., together with the emphasis on diamond and gold. If either the gold price, or diamond cost must unexpectedly rise, the sell wouldn’t be gifted to cope as well as the dramatic increase in price. Since gold is the notes of trading in the worlds, diamonds have to play moment fiddle. Since 1998 the gold assessment grew from $250 to a whopping $1000 in 2008. 400% increase. But the sell didn’t only recompense for the increase in the gold price, save for as well charges for a 250% increase in diamond prices. But the producer never sees this increase and the money ends up in the pockets of the middleman!

Large diamond mines are ultimate in South Africa and the whole of Africa, and sooner than later the big companies will have to dig into their treasure to acquire diamonds to market - and for this they WILL value an arm and a leg. The demand is big, the supply is little!

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