Investors are always on the lookout for credible information that they can use to zero in on investment mediums that can prove to be promising in the long run. This post will be exploring in brief about the overall growth of the diamond industry in recent years.
If you are one of those careful investors who recently is considering the decision of investing in diamonds, to diversify their investment portfolio, you need to check this out!
The information shared in the sections below will talk about the global diamond sector and will try to set up a rough timeline about the sector’s future. So without further ado, let us get straight to it then now shall we!?
Diamond mining companies did their best to boost the growth of the sector
The major contributor to the unprecedented growth of the global diamond sector is the rough diamond mining companies. They were the reason why the diamond sector got a boost of more than 20 per cent by volume of rough diamonds.
It led to a situation where all parties associated with the sector benefited from. The revenues mining companies generated from all over the globe rose to about 2 per cent which is expected to increase in the following years.
Profits were exponentially growing and the market is steady
The midstream profitability margins remained steady and ranged between 1 to 3 per cent. If one takes into account the rising demand for diamond jewellery then it is expected by 2020, corporations associated with the diamond sector can expect to cash-in even from cutting and polishing rough diamonds.
The most astonishing fact is that India played a major role in the overall boost of the diamond sector in recent years. When one considers the labour costs for polishing and cutting rough natural diamonds, India offers the best possible results.
Other than that, the country recently made necessary changes in its regulations which meant investors can expand their businesses in the nation since access to finances are now easier than ever.
Global sales reached sky high in recent years
The global demand for diamond jewellery saw a lot of traction, 2 percent to be exact in recent years. It is fueled by the emergence of market trends that boosted the sales of luxury items which mainly consists of diamond jewellery. The factor that drives this trend is the strong macroeconomic conditions in countries like the USA, China and India.
This demand for a diamond in all of its available forms is still going strong in the current year and is expected to perform in the said way for years to come. However, if trade relations between the US and China is not settled, one can expect the market to appear sluggish at times but fret not the conditions won’t last long.
In the end, what one can take away from this blog post is that the future of the diamond industry is dazzling. In terms of volume, the supply for a natural rough diamond can vary between negative 1 per cent to positive 1 percent – which is normal. Other than that, the demand for natural rough diamond will grow (estimated 2 per cent consistently till 2030). It will be supported by the fact that the middle class is prospering in countries like the USA, China and India. Short term fluctuations may occur, which is normal but it doesn’t mean the interests of investors will be negatively affected.
