The diamond pipeline is a figurative pathway along which a diamond travels from the depths of the earth to the ring upon the finger of a bride. Along that journey – from mine to marketplace – it accumulates value, at rates that generally depend upon what stage of the pipeline the diamond is located.
The rise in value is considerable. According estimates, whereas worldwide rough diamond production equaled $13.4 billion in 2016, the value of diamond-set jewelry at retail stood at $80.1 billion.
What is remarkable is that, although it changes its appearance along the way, the composition of the diamond essentially remains the same. It may be cleaved, cut, lasered and/or polished, but physically the brilliant gemstone that is set in an item of jewelry is comprised of essentially the same material as the misshapen crystal that originally was extracted from the earth. The exception to this rule is certain color treated diamonds, but even there the change is minimal.
There essentially are six distinct stages along the diamond pipeline. During the first two, the upstream section of the pipeline, loose rough diamonds are involved. The second two, the midstream section, involve loose polished diamonds, and third two, the downstream section, involves diamonds that are set in jewelry.