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Statistics indicate that on average, the price of round, brilliant cut diamonds sized at 3 or more carats has increased 5 percent to 8 percent in the past year. Likewise, in the past three years, prices for diamonds larger than 2 carats have climbed an astounding 23 percent to 35 percent.Statistics indicate that on average, the price of round, brilliant cut diamonds sized at 3 or more carats has increased 5 percent to 8 percent in the past year. Likewise, in the past three years, prices for diamonds larger than 2 carats have climbed an astounding 23 percent to 35 percent.
The figures were lately published in The Rapaport Diamond Report, a monthly publication that informs the jewelry and diamond industry of market trends and sets consumer pricing. The study suggests that diamond prices will continue to rise despite recent decreases in consumer spending..
What's causing the steep increase?
Big suppliers, like DeBeers, which sells about 45 percent of the world's rough diamonds, drive the pricing for loose diamonds. According to Jeffrey Levin, recent price hikes can largely be attributed to these diamond business giants. For more than twenty years, Jeffrey Levin has operated Firenze Jewels, a family-owned jewelry boutique in New York City's Diamond District.
What does this mean for the diamond market?
Mr. Levin has seen many price fluctuations in the past but he warns that the larger players in the current market have gotten in over their heads with this latest hike. Rapaport confirms this. Their 2006 Diamond Report stated: "The clear conclusion is that there isn't any justification for the high prices of diamonds. Beneath the surface there is a real turbulence... We are inside an ever-growing bubble that is expanding and stretching to the point at which an explosion is imminent."
Many larger investors have already reached their financial limits and won't be able to offset future price increases. As prices are driven upward at a rate beyond consumer tolerance, these companies will inevitably suffer from the fall out.
What should consumers expect?
The more immediate consequence of this inflation will befall the consumer in the form of unreasonably elevated retail prices for sizable, quality diamonds. Customers may find some relief with smaller jewelry dealers, who invest mainly in finished pieces, not loose stones. These operators will not be as affected by the wholesale trends because they tend to pool resources with other brokers for high-end pieces, allowing them to calmly weather market fluctuations.
Statistics indicate that on average, the price of round, brilliant cut diamonds sized at 3 or more carats has increased 5 percent to 8 percent in the past year. Likewise, in the past three years, prices for diamonds larger than 2 carats have climbed an astounding 23 percent to 35 percent.Statistics indicate that on average, the price of round, brilliant cut diamonds sized at 3 or more carats has increased 5 percent to 8 percent in the past year. Likewise, in the past three years, prices for diamonds larger than 2 carats have climbed an astounding 23 percent to 35 percent.
The figures were lately published in The Rapaport Diamond Report, a monthly publication that informs the jewelry and diamond industry of market trends and sets consumer pricing. The study suggests that diamond prices will continue to rise despite recent decreases in consumer spending..
What's causing the steep increase?
Big suppliers, like DeBeers, which sells about 45 percent of the world's rough diamonds, drive the pricing for loose diamonds. According to Jeffrey Levin, recent price hikes can largely be attributed to these diamond business giants. For more than twenty years, Jeffrey Levin has operated Firenze Jewels, a family-owned jewelry boutique in New York City's Diamond District.
What does this mean for the diamond market?
Mr. Levin has seen many price fluctuations in the past but he warns that the larger players in the current market have gotten in over their heads with this latest hike. Rapaport confirms this. Their 2006 Diamond Report stated: "The clear conclusion is that there isn't any justification for the high prices of diamonds. Beneath the surface there is a real turbulence... We are inside an ever-growing bubble that is expanding and stretching to the point at which an explosion is imminent."
Many larger investors have already reached their financial limits and won't be able to offset future price increases. As prices are driven upward at a rate beyond consumer tolerance, these companies will inevitably suffer from the fall out.
What should consumers expect?
The more immediate consequence of this inflation will befall the consumer in the form of unreasonably elevated retail prices for sizable, quality diamonds. Customers may find some relief with smaller jewelry dealers, who invest mainly in finished pieces, not loose stones. These operators will not be as affected by the wholesale trends because they tend to pool resources with other brokers for high-end pieces, allowing them to calmly weather market fluctuations.
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