Global diamond jewellery sales grew 3% to a new record high of $81 billion in 2014
2014 saw positive growth in consumer demand for diamond jewellery in local currency terms across all of the top five markets, which together account for about 75% of global demand. At constant exchange rates, growth amounted to almost 5% globally. Growth at current exchange rates was 3% due to the US dollar strengthening against the currencies of some of the main consumer markets.
The US was the fastest growing market for diamond jewellery in 2014, up 7%, followed by China, up 6%.
The US diamond jewellery market continued to grow at a robust rate, due to strengthening of the economic recovery, growing job numbers, an improving stock market and, towards the end of the year, declining oil prices increasing consumers’ spending power.
China was the second fastest growing diamond market after the US. Whilst this was slower than in 2013, it still represented substantial growth given the consumption base grew so rapidly in recent years. This slower pace of growth in diamond jewellery sales was due largely to the slowing down of the economic growth rate. Chinese consumers’ growing preference for travel and luxury shopping abroad compensated for some of the domestic slowdown.
The Indian market returned to positive growth, up 3% in local currency terms, as government reforms began to take hold and improving macro-economics boosted discretionary spending. However, Rupee depreciation against the US dollar pushed the growth rate into slightly negative territory (-1%).
The Japanese market exceeded expectations, achieving positive local currency growth (+2%), driven by the upsurge in Q1 spending prior to the consumption tax increase. However, the sharp depreciation of the Yen against the US dollar eroded that to negative growth of -11% in US dollars.
The Gulf region, and particularly UAE, saw lower tourist numbers and weaker spending from key overseas nationalities, such as Russians and Chinese. However, demand from local residents was stable and grew in low single digit numbers.
USD at Polished Wholesale Prices
In terms of global share of demand for polished diamonds (measured by analysing the Polished Wholesale Price value of diamonds contained in diamond jewellery), the US remained the largest market, increasing its share to 42% in 2014 (compared with 40% in 2013). China, including Hong Kong and Macau, remained the second largest market with 16%. India and the Gulf region were the next largest markets with 8% shares, followed by Japan with 5% (slightly down from 6% in 2013).