Global sales of diamond jewelry grew by 4 percent in 2018, compared with 2017, totaling $85.9 billion, the state-controlled Russian diamond mining company Alrosa has reported in its global luxury and jewelry market research for 2018.
According to the Russian company, the growth rate of the global jewelry market was lower than in 2017, when it stood at 5 percent. This, Alrosa said, mainly as a result of a slowdown in key consuming markets during the second half of 2018.
In the first half of the year, there had been persistently high demand from the local populations and the tourist trade in most of the larger consumer markets. It resulted in a 6 percent rise in global jewelry demand during the first half of the year, Alrosa reported.
BUOYANT DOLLAR PLACES PRESSURE ON NON-AMERICAN MARKETS
For many in the jewelry industry the story of the year was the surge in the value of the U.S. dollar, which placed tremendous pressure on the prices of both loose and jewelry-set diamonds, which are linked to the American currency.
The buoyant greenback came as result of the strength of the U.S. economy relative to other countries in the world, and policy of the Federal Reserve to raise interest rates, making them relatively higher than in the rates in other developed countries.
What this meant in the diamond markets, Alrosa said, was a decline in demand in countries other than the United States. Overall, it precipitated about a 2 percent decline in demand during the second six months of the year.
Diamond jewelry sales in North America, which in 2018 accounted for more than half of purchases at retail, showed consistently high growth rates.
Sales in Asia accounted for about 30 percent of global diamond jewelry in 2018.
DESPITE WEAKER H2, ASIA POSTS HIGH GROWTH
According to Alrosa, diamond jewelry sales in North America, which over the year accounted for more than half of purchases at retail, showed consistently high growth rates, although it ultimately matched the global total by rising 4 percent when compared with 2017.
Sales in Asia, which included the countries of Southeast Asia and India and accounted for about 30 percent of global diamond jewelry demand actually grew at a higher rate than did the United States during the first half of the year.
But Asia saw a turn for the worse during the second half of 2018, Alrosa reported, largely because of an economic slowdown in the region, not to mention the value of the U.S. dollar. Growth in diamond jewelry sales slowed down to 1 percent, providing annual growth rate of 5 percent by the end of the year.