Rio Tinto, the third largest producer of rough diamonds, has predicted that global demand for diamonds will rise into the foreseeable future while other products will far sooner reach a saturation point as world GDP per capita rises:
Strong industry fundamentals are driving price – the supply and demand imbalance is expected to widen:
While there is no doubt that we will see a steady growth in demand for diamonds in the coming years, the problem faced by the diamond industry is that our portion of the luxury wallet has diminished, as shown in this presentation by leading authority Chaim Even-Zohar at the recent WFDB congress in Turkey:
In real terms where the luxury goods market has grown by 77% the demand for diamonds in a 12 year period from 1999 to 2011 has only grown 26.5%.
Without a focus by producers on appreciating that they too must participate in a generic marketing program as the one developed by the WFDB with the launch of the World Diamond Mark, the growth and profitability of the diamond sector will be severely diminished, and worse we will be commiserating about the lost opportunity.