Of late, the lab-grown diamond market is going through a rough patch as the prices have dropped significantly from $300 a carat in July 2022 to $78 a carat recently.
Even the natural diamonds experienced a 25-30% price drop, this can be attributed to the majority of factors like rising gold prices, a downturn in the US economy, and changes in Chinese buying patterns has impacted the Indian diamond industry in a negative way.
As a result, diamantaires and businesses of varying sizes in Surat, where the diamond industry is a major employer are facing challenging times.
The year 2023 brought hope to the Indian diamond industry as there was an increase in rough diamond imports to India, giving industry stakeholders hope for recovery. But the optimism did not last as the market now faces an oversupply issue. As per the industry traders the diamond imports rose in February this year, but the positive outlook was short-lived, and the oversupply issue persists.
Moreover the demand for natural diamonds has waned, with fierce competition from flawless lab-grown diamonds.
China, which used to be a large buyer of flawless mined stones, is suddenly not interested and its purchasing power is merely 10%-15% explained the industry experts.
As per the Data from the Indian gems and jewellery sector overall gross exports of gems and jewellery during April-May amounted to $4,691.6 million (Rs 39,123 crore), reflecting a 5.9% decrease from the previous year. Declines were notable in the cut and polished diamonds sector, with exports falling 15.5% to $2,627 million. Similarly, the provisional gross export of polished lab-grown diamonds dropped 15.5% to $204.2 million from $241.6 million in the same period last year.
Indian gems and jewellery sector welcomes Indian government initiative of reducing the import duty from 15% to 6% in Budget 2024 but more needs to be done if the industry.
