Investment bank Goldman Sachs forecasts demand for polished diamonds will continue to increase due to the growing middle class in China and other emerging markets.
The bank believes diamond prices will rise as the number of wealthier people grows in the emerging markets together with a continuing U.S. economic recovery which will cancel out any additional production.
The main diamond miners – De Beers, Alrosa, Rio Tinto and Dominion Diamond – reported higher production in the first nine months of this year.
Goldman Sachs said it does not expect a new mine to come on-stream for at least eight years, and in the meantime the demand from the Chinese and improving American market will outpace supply over the medium to long term.
Goldman forecasts supply to grow by a compound 5.2% over the next four years through to 2017, well behind the forecast 11% growth in demand in . NYC Wholesale Diamonds President Keith J Saxe concurs and reiterates NYCWD’s estimate of a 12 – 15% growth in demand.