Text/Chen Haoxing
Recently, De Beers Group, the leading international diamond company, once again lowered the prices of various rough diamonds at its first rough diamond viewing meeting this year, using the keyword "price reduction". According to informed sources, the current price reduction for rough diamonds over 2 carats is more than 15%; the average price reduction for rough diamonds between 0.75 and 2 carats is between 10% and 15%; while rough diamonds under 0.75 carats have experienced a price reduction of 5% to 10%. % price reduction; the comprehensive price reduction is approximately 10%.
As the “number one gemstone” recognized worldwide, are diamonds “no longer fragrant”?
Why do diamond prices keep falling?
In an interview with China News Service, Wan Zhe, a professor at Beijing Normal University and former chief economist of China National Gold Group, believes that the decline in diamond prices can be mainly attributed to three reasons:
First, global demand has generally been sluggish in the past few years due to the impact of the COVID-19 pandemic, especially in terms of marriage expenditures. Many newlyweds chose to postpone or simplify their weddings during the epidemic, which directly led to a reduction in demand for diamonds. Marriage is the main driving factor in the diamond market, and the reduction in demand for marriage has a negative impact on diamond prices.
Secondly, the uncertainty of the global economic outlook has also affected the diamond market to a certain extent. In an environment of increasing global economic uncertainty and inflation, consumers are more cautious about purchasing luxury goods, including diamonds, and are more inclined to look for relatively stable investments.
In addition, some regional conflicts, instability and other global risk events make investors more inclined to purchase safe-haven assets, such as gold. Consumer demand for safe-haven assets has increased and interest in high-risk assets has waned, leaving diamond collecting and investment prospects relatively bleak. Against this backdrop, diamond prices continue their downward trend.
Artificially cultivated diamonds are popular
The rapid development of artificially grown diamonds, known for their "cheap and high quality", is also one of the reasons why the price of natural diamonds has been impacted.
After calling many diamond ring customization and jewelry stores in Beijing, Guo Shijun found that the price difference between natural diamonds and lab-grown diamonds is significant. Currently, the price of a 1-carat natural diamond ranges from RMB 10,000 to RMB 70,000, while a cultivated diamond of the same size only costs RMB 1,000 to RMB 3,000. The price of a 2-carat natural diamond is in the range of 100,000-200,000 yuan, while the price of a 2-carat lab-grown diamond is generally around 10,000 yuan.
In the Xidan Wedding Building in Beijing, Mr. Duan, who runs a diamond ring customization business, told China News Service: It is difficult for ordinary people to distinguish the difference between natural diamonds and lab-grown diamonds with the naked eye. Therefore, in the past two years, more customers have chosen lab-grown diamonds than before. too much. However, in the second-hand diamond market, natural diamonds still have the ability to be converted into cash, but no one will recycle lab-grown diamonds.
In the field of artificially grown diamonds, Henan has a very prominent position. Recently, the official account of Henan Culture and Tourism Douyin released a video: At the Longmen High-speed Railway Station in Luoyang, Henan, tourists coming to Henan can get a diamond as long as they match the poem or answer the question correctly. Many tourists looked in disbelief after receiving the diamonds, and showed off the diamonds they got for free to tourists coming and going.
According to the "Henan Daily" report, the global production of cultivated diamonds in 2021 will be 9 million carats, and Henan Zhecheng County alone has produced 4 million carats, which can be called the "capital of man-made diamonds".
Henan Power Diamond Co., Ltd. is mainly engaged in cultivated diamonds. According to the company's data, the current production cost of rough diamonds produced by the high-temperature and high-pressure method has dropped to about 90 yuan per carat, the sales price is about 630 yuan per carat, and the gross profit margin is about 80%.
Freisteger, director of the Belgian Federation of Diamond Exchanges, also publicly stated that two years ago, artificial diamonds were 40% cheaper than natural diamonds, and later 60% cheaper. By 2023, they will be 70% to 80% cheaper, and will even reach 99%, maybe in the future if you buy a piece of soap in the supermarket, the salesperson will give you a diamond.
What will be the trend of diamond prices in the future?
The price of natural diamonds has been falling repeatedly, and artificially grown diamonds are of high quality and low price. What will be the trend of diamond prices in the future?
In Wan Zhe's view, whether consumers will pay for diamonds still depends on demand. People who mainly consume diamonds often regard them as symbols of love. Diamonds still have a certain influence and appeal in the marriage and love market. So, lab-grown diamonds may serve as a more affordable alternative. As for larger natural diamonds, consumers who are willing to collect and invest will still consider purchasing them.
She predicts that judging from the current market trends, diamonds may experience some fluctuations and rebounds in the short term, but in the long term, skyrocketing prices are less likely. For investors and consumers, the most critical thing is to live within their means, plan consumption and investment portfolios rationally, and always grasp risks to ensure that they have the ability to manage finances.
"Hard-core Half-Buddha Immortal", the up owner of Bilibili who aims to reveal the inside story of the industry, believes that diamonds as luxury goods currently have two major problems: First, they lack the premium ability of brand logos; second, they have relatively low liquidity in the secondary market. Difference. In contrast, other luxury goods such as gold and antique calligraphy and paintings may have better circulation opportunities in the secondary market.