As diamond prices rise by nearly 10%, jewellers are upbeat about healthy demand nationwide

Retailers are also confident that diamond jewellery will perform well in the near future, as correction in pricing does not necessarily mean a huge increase in price for the end-consumer

Mumbai: After a long period of stagnation and the two-month suspension of rough diamond imports being called off on December 15, 2024, the diamond industry is now rejoicing over a rise of nearly 10% in the prices of cut and polished diamonds. Increased domestic demand, pre-holiday buying in the US and a voluntary halt on rough diamond imports are factors that have fuelled this price correction.

The correction in pricing does not necessarily mean a huge increase in price for the end consumer, and diamond retailers are upbeat about a healthy demand nationwide in the coming months.

Peeyush Prakash, Director, Alankar Jewellers, Meerut, says, “As of now, retail customers have barely been affected by the rise in prices. With the segregation of lab-grown diamonds and natural diamonds, the demand for natural diamonds will possibly remain steady, since takers for natural diamonds stay loyal to their desired categories.”

Any increase in price at the retail stage takes months, if not weeks, to reflect for the end consumer, as even vendors wait for a certain period to see if prices will stabilize. “In the case of solitaires, real-time prices are immediately reflected, but that is not so with loose diamonds,” explains Prakash.

Jewellers are also confident that diamond jewellery will perform well in the near future, as they estimate that the phase of fluctuation in demand and prices is over. More knowledge and awareness about natural diamonds among consumers is also expected to help stabilize the demand.

“Around September, there were some challenges in the diamond industry and customers were reluctant to buy because there was talk that diamond prices were going down. Post Diwali, diamond prices picked up. Right now, diamonds are performing well and prices are also stabilizing and in fact rising. Customers are beginning to buy diamonds again,” says Gaurav Anand, Managing Director, Anand Jewels, Indore.

Pratap M Kamath, Managing Director, Abaran Timeless Jewellery, Bengaluru says that diamond jewellery has been consistently performing positively year after year, even though gold jewellery takes the lion’s share. “The demand for diamonds is, overall, very robust, even beyond the wedding season and sales have been very good in the last two months, as we had Dussehra and Diwali. Moreover, gold prices also have come down slightly. The 10% increase in diamond prices will not be reflected immediately. The crux is that the demand for diamond jewellery is not very price-sensitive,” Kamath adds.

Amit Kapoor, Managing Director, Nippy Jewellers, New Delhi echoes the sentiment and says, “The demand for diamond jewellery has not been affected but there is a change in the pattern, such as the demand for solitaires. However, to understand how this price increase will affect diamond jewellery demand during this season, we need to wait and watch. Since prices of lab-grown diamonds are decreasing and those of natural diamonds may increase, there may also be a shift in demand for the latter.”

As reported by The Economic Times, chain store brands Orra and Malabar Gold and Diamonds have been experiencing the benefit of price correction. Dipu Mehta, Managing Director, Orra was quoted by ET as saying, “A price rise in diamonds may cost a buyer Rs 1,000 more. Diamond jewellery has shown a 15% growth in this year’s winter wedding season, as compared to the same wedding season last year.” Meanwhile, price correction of diamonds in the range of 1 to 3 carats has boosted the demand for diamond jewellery in the wedding season, MP Ahammed, Chairman, Malabar Gold & Diamonds, told ET. 

Written by Aparna Bhowmick

Retail Jeweller India Exclusive