What Happened to Global Diamond Industry?
The global diamond industry experienced a significant downturn in 2023-2024 due to oversupply, economic uncertainties, and the rising popularity of lab-grown diamonds, but has shown definitive signs of recovery in 2025 and 2026. This recovery is driven by aggressive production cuts by major natural diamond miners, stabilizing demand, and the industry's adaptation to new market dynamics, including stricter sanctions on Russian diamonds and the continued growth of the lab-grown sector. As of September 2026, natural diamond prices are stabilizing, with smaller stones leading a modest rebound, while lab-grown diamonds continue to expand their market share, particularly in bridal jewelry.
Quick Answer
The global diamond industry is currently in a recovery phase as of September 2026, following a challenging period in 2023-2024 marked by price corrections and reduced demand. Natural diamond prices are showing signs of stabilization and modest increases, particularly for smaller stones, driven by significant production cuts from major miners like De Beers and Alrosa. Lab-grown diamonds continue to gain market share due to their affordability and ethical appeal, especially among younger consumers and in the bridal segment. The industry is also navigating the full implementation of G7 sanctions on Russian diamonds and a broader shift towards transparency and responsible sourcing.
📊Key Facts
📅Complete Timeline13 events
G7 Agrees to Ban Russian Diamonds
The G7 leaders agreed to introduce import restrictions on non-industrial diamonds mined, processed, or produced in Russia, with a direct ban to be implemented by January 1, 2024.
Direct Ban on Russian Diamonds Takes Effect
All G7 members implemented a direct ban on diamonds exported from Russia, as part of coordinated sanctions following Russia's invasion of Ukraine.
G7 Ban Expands to Polished Russian Diamonds (1-carat+)
The G7 ban expanded to include unsorted and non-industrial diamonds processed in third countries, consisting of Russian diamonds equal to or above 1.0 carat per diamond.
G7 Ban Expands to Smaller Polished Russian Diamonds (0.5-carat+)
The prohibition further expanded to include Russian natural and synthetic diamonds and jewelry incorporating Russian diamonds (all products) processed in a third country, with a weight equal to or above 0.5 carats or 0.1 grams per diamond.
Global Rough Diamond Production Falls to Multi-Decade Low
Global natural diamond supply was estimated at just over 100 million carats in 2025, marking the lowest annual output since 1992, largely due to production cuts by major miners.
De Beers Reports Significant Loss and Continues Production Cuts
De Beers reported an underlying EBITDA loss of $511 million for 2025, primarily due to stock rebalancing initiatives and lower forecasted prices. The company continued its Origins strategy, focusing on streamlining and revitalizing natural diamond demand.
Stricter EU Rules for Russian Diamond Imports Take Effect
Importers into the EU are required to meet stricter rules, including completing Due Diligence Statements on Diamond Origin for all polished stones over 0.50-cts, to prevent sanctioned Russian diamonds from entering the market.
US-India Trade Deal Boosts Indian Diamond Manufacturing
Recent trade agreements between the US and India bolstered confidence in the Indian diamond manufacturing hub, with reduced tariffs and streamlined export processes.
Rio Tinto Exits Diamond Business with Diavik Mine Closure
Rio Tinto's last producing diamond asset, the Diavik mine in Canada, delivered its final production, marking the company's complete exit from the diamond business after 23 years.
De Beers Announces Two-Year Pause at Venetia Mine
De Beers announced its intention to pause production at the Venetia mine in South Africa for two years, as part of its cost reduction and business streamlining efforts.
OFAC Renews License for 'Grandfathered' Russian Diamonds
The U.S. Office of Foreign Asset Controls issued General License 104B, allowing continued import of Russian-origin diamonds that were physically outside Russia before the G7 ban dates, valid until September 1, 2027.
Rapaport Reports First 1-Carat RAPI Increase in 15 Months
The Rapaport Trade Diamond Index (RAPI™) for 1-carat diamonds rose 0.5% in August 2026, marking the first positive monthly increase in 15 months and signaling a broader price recovery.
Diamond-Producing Nations Push for Joint Marketing Strategy
African diamond-producing nations, including Angola and Botswana, alongside industry bodies, are working to formalize a global natural diamond marketing strategy, emphasizing African ownership, ethical sourcing, and value addition.
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🔍Deep Dive Analysis
The global diamond industry has undergone a transformative period, marked by significant challenges and strategic shifts. Following a robust 2022 driven by post-pandemic luxury spending, the market faced a notable downturn throughout 2023 and 2024. This period was characterized by plummeting demand, oversupply, and a subsequent correction in natural diamond prices. Economic uncertainties, inflationary pressures, and a shift in consumer preferences contributed to this slump.
A key factor in the industry's evolution has been the rapid ascent of lab-grown diamonds (LGDs). These diamonds, identical in physical, chemical, and optical properties to mined diamonds but significantly more affordable, have increasingly captured market share. By 2025, the global lab-grown diamond market was valued at approximately $30.14 billion and is projected to reach $34.15 billion in 2026, growing at a CAGR of 13.3% through 2034. Their appeal to millennials and Gen Z, who prioritize ethical sourcing, sustainability, and value, has led to a substantial increase in their adoption, particularly in engagement rings, with 61% of US couples opting for LGD engagement rings in 2025, up from 52% in 2024. The wholesale prices of lab-grown diamonds have fallen by up to 90% since 2020, making them an even more attractive alternative.
In response to the market pressures and the rise of LGDs, major natural diamond producers implemented aggressive supply control measures. De Beers, for instance, significantly cut its production guidance for 2025 and 2026, operating at as much as 35% under capacity. Similarly, Russia's ALROSA, the world's largest producer by volume, also reduced its output, estimated at 15% below capacity. These production cuts, alongside the depletion of some legacy mines, led to global rough diamond production falling to an estimated 98.8 million carats in 2025, the lowest annual output since 1992, with a moderate rebound to around 105 million carats forecast for 2026.
Another significant development has been the implementation of G7 sanctions on Russian diamonds following the invasion of Ukraine. A direct ban on Russian diamonds came into effect by January 1, 2024, with phased expansions throughout 2024 to include polished diamonds processed in third countries (March 1, 2024, for 1-carat and larger; September 1, 2024, for 0.5-carat and larger). From January 1, 2026, stricter rules require importers to complete Due Diligence Statements on Diamond Origin for polished stones over 0.50-cts to ensure compliance. While these sanctions aim to deprive Russia of significant revenue, they have also introduced complexities and a push for digital traceability systems within the global supply chain.
As of September 2026, the global diamond market is showing clear signs of recovery. Demand improved across key markets, particularly in the US and India, throughout 2025 and into 2026. The Rapaport Trade Diamond Index (RAPI) for 1-carat diamonds recorded its first monthly increase in 15 months in August 2026, rising by 0.5%. Smaller diamonds (0.30 and 0.50 carat) saw even stronger gains, increasing by 2% and 2.5% respectively. This recovery is attributed to the effectiveness of supply cuts and a stabilization of demand, with some reports indicating consumers are cooling on lab-grown diamonds for certain segments. De Beers continues its 'Origins strategy' focusing on streamlining operations, divesting non-core assets, and revitalizing consumer desire for natural diamonds through marketing campaigns. Producer countries like Angola, Botswana, and Namibia are also increasingly seeking to add value locally and have a stronger voice in shaping the industry's future. The industry is adapting to a more transparent, competitive, and technology-driven landscape, with a focus on design, customer experience, trust, and certification.
What If...?
Explore alternate histories. What if Global Diamond Industry made different choices?