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Diamond Trade Expected to Start Slow in 2023 Amidst Potential Volatility

OGP | Collectors' Recommendations

Apr 27, 2023

The diamond trade is predicted to have an eventful 2023, but may experience a slow start similar to the end of last year. Activity is expected to pick up in the second half of the year. However, external factors such as geopolitical and macroeconomic developments could influence the market and cause further adjustments. Despite this potential volatility, the industry can draw on past crises to navigate these changes, even if other changes are being implemented gradually.

As a benchmark in the diamond industry, Rapaport's 'Six Stories That Will Shape the Diamond Market in 2023' report will better ensure your direction for jewelry investment. Change in the diamond industry is typically a gradual process. Often, it takes a significant global event such as the 2008 financial crisis, the 2020 pandemic, or Russia's 2022 invasion of Ukraine to prompt immediate action within the market. The outbreak of Covid-19 necessitated a shift to digital platforms for the industry, and the financial crisis spurred the trade to elevate its compliance and reporting standards, albeit at a slow pace. Presently, the industry is adapting to the aftermath of the Russia-Ukraine conflict and the associated US sanctions on Alrosa. However, market forces have yet to enable the conflict's full impact. The conflict will likely have a greater impact on the industry in 2023 than it did in 2022 as source-verification programs gain momentum and the supply-demand dynamic adjusts. Additionally, other factors are predicted to affect the diamond trade in 2023, including ongoing uncertainty in the US and Chinese economies, as well as the continued growth and evolution of the lab-grown diamond market. Finally, De Beers and the Botswana government are expected to finalize a deal that may have broader implications for the industry.

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