For years, diamond industry experts have been predicting a doomsday for diamonds. A time when the demand for the precious stones will be at an all-time high while a lack of active mines won’t be able to keep up with this demand. That time looks like it could happen as soon as five years from today.
Currently, only 30 mines around the world have a substantial output of diamonds being recovered. As these mines continue to age, the supply of stones coming out of them will only decrease.
Meanwhile, the demand for diamonds is growing partially thanks the increasing wealth of the middle-class in the most populous country in the world, China. The increasing westernization in that country combined with the lack of homegrown diamond resources and increasing wealth means that millions who never cared for the precious stones have become willing buyers.
To combat the increasing demand for diamonds, some companies have started to transform their existing mines from open-pit operations to underground production. The theory is that this changes will make it easier to find the remaining diamonds buried deep into the ground. However, the process can take 7-10 years and becomes much more expensive to maintain on a daily basis.
The long-range future for diamonds could get better as new diamond mines in Africa, Russia and Canada are heading into production. However, there are no guarantees about the quantity or quality of the stones that may be coming out of there. There has also been talk from geologists about finding diamonds in the arctic circle, within the earth’s upper crust or from falling meteorites. No word yet on whether any of these options will help fill the potential void in diamond production or if they are merely a (kimberlite) pipe dream.
With this combination of dwindling supply and increasing demand, both the price and value of diamonds should continue to increase in the future. For colour diamonds, the increase could be even more dramatic. In the last 10 years, the value for colour diamonds has gone up between 15 to 30 per cent year over year. With this “diamond doomsday” looming closer, these numbers should only become dramatically higher in comparison.