Diamond prices may touch record
highs in coming months By Kevin Skinner
Diamond prices are expected
to hit new highs over the next 12 months, as the
divide between supply and demand widens.
Prices would increase by up to 10% over the
next year, as the industry attempted to balance the
market, said respected international diamond expert,
South African-based James Allan, of Allan Hochreiter finance
group.
At current production prices, that would equate
to a rise of about $9 to about $99 a carat.
If you are actively involved in the
production and sales of diamonds, the future looks extremely
bright, said Allan, who was the opening speaker on Tuesday
at the 2007 Paydirt World Diamond Conference in Perth.
Global diamond sales reached $72 billion
in 2006 an increase of six percent, he said.
That is being driven by the US, which
accounts for about 43% of sales, but there are some new trends
appearing.
In China about 40% of Chinese women
are now getting married with diamond rings, and that trend
is expected to increase significantly over the coming years.
India is a rapidly strengthening sector
with a growth rate of 26 per cent last year and that
will continue.
Further, with the weakening US dollar
diamond demand tends to pick up in other countries.
So as demand increases and supply decreases,
the market will balance itself by sharp increases in the price
of diamonds from next year through to 2015.
Allan predicted the supply decline in many
of the worlds major diamond producing countries would
continue, with Botswana production expected to lose about
$460m in production; Russia $260 million and South Africa
$160 million between 2005 - 2015. - Kevin Skinner