Diamonds in Flux: A Mid-Year Market Report

We’ve reached the midpoint of the year, and if there’s one thing we can all agree on, it’s that the first half of 2025 has kept the diamond world on its toes. From landmark agreements to geopolitical curveballs, it's been a dynamic few months. Here’s a quick look back at some of the most notable developments (in no particular order):

>>> De Beers & Botswana Sign Agreement

De Beers and the Government of Botswana finalized their long-anticipated 10-year sales agreement, underscoring the growing clout of producer countries. It’s a significant moment, not just for Botswana, but for the changing power dynamic across the industry.

>>> US Tariffs Cast a Shadow

President Trump’s April announcement on new tariffs added a fresh layer of uncertainty for the diamond trade. With the July 9 deadline fast approaching for countries to negotiate trade deals, there’s growing pressure on the diamond industry to secure an exemption similar to what gold and platinum enjoy. However, the focus seems to be on country-level deals rather than product-specific exemptions. Negotiations with India and Botswana are especially worth watching. That said, all trading centers have skin in this game.

>>> Rough Market Remains Cautious

Rough diamond trading continues to be subdued, well below last year’s already-muted levels. De Beers and other miners are holding more inventory, while manufacturers are keeping polished production intentionally lean. It’s a careful balancing act across the pipeline.

>>> Synthetic Diamond Sentiment in FluxThe lab-grown diamond segment continues to stir debate. Prices are falling, and many retailers appear to be pivoting back to natural diamonds, particularly for bridal jewelry. Wholesalers report growing interest in naturals, though time will tell whether this is a real shift or a temporary reaction.

>>> Momentum Builds Around Natural Diamond MarketingOne of the more encouraging trends is the resurgence of marketing around natural diamonds. The June signing of the Luanda Accord – a pledge by industry players to contribute 1% of rough diamond sales to the Natural Diamond Council starting in 2026 – marks a major milestone. The specifics still need to be worked out, but the commitment is there.

If you haven’t already, check out my latest video exploring this topic. That the conversation has shifted from “we need to act” to “how we shape the message” is encouraging:

• Rethinking Diamond Marketing | Fighting Back Against Synthetics

And of course, just as telling as the news we did hear is what we didn’t hear, at least publicly, perhaps giving us something to look forward to in the second half:

>>> Who’ll Buy De Beers?

Rumors regarding the prospective sale of De Beers by Anglo American continue to swirl, but we have no official word yet. Reports suggest multiple consortia are in the mix, and a potential IPO is also on the table.

>>> Russian Diamond Restrictions: Still in Flux

The US currently requires importers to self-declare that their diamonds aren’t of Russian origin, with documentation to support it. But the bigger spotlight is on the EU and other G7 countries, which are working toward a blockchain-based traceability system. The current target for implementation is January 1, 2026. The World Diamond Council is advocating for the Kimberley Process certificate to serve as the starting point for proof of origin, especially now that KP certificates generally include country-specific origin.

What I’m Reading 

>>> Bain & Company Report: Luxury confronts slowdown amid economic headwinds and market disruptions…

This latest report from Bain offers some important insights into the state of the luxury market. While it doesn’t spell it out directly, it appears the middle-income consumer is stepping back, and we’re seeing spending increasingly concentrated among top-tier clients. That shift has big implications. These high-end buyers are now carrying more weight in the market, and with that comes higher expectations. They’re looking for deeper value, more meaningful experiences, and a stronger emotional connection to the brands they support.

Hot Off The Diamond Press

>>> Keep an eye on The Diamond Press news page for updates on these developments and more: This Week in Diamonds

Chart Check

 Luk Fook just released its full-year results, and they reflect the broader pressures facing the jewelry sector in greater China. The Hong Kong-based jeweler reported a 13% drop in group revenue to HKD 13.3 billion ($1.7 billion), citing softer demand for gold – likely a reaction to persistently high prices. Net profit fell even more sharply, down 39% to HKD 1.08 billion ($136 million). On the wholesale side, sales slipped 9%, impacted by weaker diamond demand in mainland China and fewer licensed shops. The company has been intentionally reducing its dependence on diamonds in recent years.

Pic of the Week

Big, Bold, and Yellow

Transatlantic Gem Sales (TAGS) reported strong demand in June for special rough diamonds larger than 10.8 carats. The tender house held three sales during the month, achieving a 90% sell-through rate in Dubai, 80% in Johannesburg, and 15 out of 17 stones sold in Luanda. The Johannesburg tender featured standout goods, including two white rough diamonds over 40 carats each, as well as two fancy yellow stones weighing approximately 70 and 35 carats, respectively (pictured). All four sold for undisclosed amounts, underscoring continued appetite for high-quality, high-carat material despite broader market caution. (Image credit: TAGS)