The diamond industry does not exist in a bubble. This was proven when the famed jewelry store Tiffany in New York City lowered their diamond prices.
According to a New York Times report, even De Beers, which managed to maintain the high prices of diamond jewelry by restricting its supply, is feeling the economic crunch. Last year. The powerful diamond supply asked its workers in Botswana to have an extended Christmas vacation. This only means that there is more supply than demand, which would in turn cause the prices of diamonds to decrease.
The situation may look bad at this, looking at the dry facts. In the United States, the retail sales for diamond jewelry dropped to around 20 percent last year. The United States holds around half of the world’s diamond demand.
This is definitely a complete turnabout from the previous stature of the diamond industry. The price of and the demand for diamonds did not experience any drastic downturn for more than 20 years. Experts say that the demand for diamonds in major countries in Asia have not yet experienced any significant decline, although this is predicted to change after the recession begins to take its claw out in the said region.
However, experts say that this can be a good time for buyers to take advantage of the situation. Buying diamond engagement rings or any type of diamond jewelry will be easier at this point, experts say, due to the decreased in the price. Owners of diamond pieces should not let go of their diamond pieces just yet, even with the fear of constant decrease in prices.
Experts say that once the economy stabilizes, the demand for diamonds may return to normal, hence changing the price of diamond pieces yet again. Meanwhile, those looking at diamonds as an investment should considering buying diamonds now, especially if they have the means and they do not plan to part of their pieces in the near future. The New York Times reports that while the industry is definitely suffering now, its long-term fundamentals are very good, which means consumers have no reason to worry.