Are Natural Diamonds Losing Value?

The near-term picture in 2025 and into 2026 is unambiguous. AWDC press briefings on the Antwerp rough-diamond market, which handles roughly eighty-six per cent of the world's rough by value, reported that Q1 2026 rough-diamond value moved through the city fell on the order of twenty-seven per cent year on year¹. This is a substantial decline by the standards of the diamond market, where annual movements of more than ten per cent at the wholesale level are unusual.

The Rapaport price list and its associated RAPI index, the longest-running wholesale benchmark for polished diamond prices, showed a steady decline through 2024 and into 2025, with cumulative drops on most categories of the price list in the twenty to thirty per cent range from the 2022 peak⁵. The Paul Zimnisky Global Rough Diamond Price Index, a widely cited independent benchmark, showed a similar pattern over the same period⁴.

Three caveats apply to all three data series. First, they are wholesale and trade-level numbers, not retail. Retail prices to consumers in 2026 have not fallen by the same percentages because retail markups have absorbed most of the wholesale compression. Second, the decline is from a 2022 peak that was itself an outlier; comparing 2026 to 2020 produces a much smaller decline, and comparing to 2015 produces a smaller decline still. Third, dispersion across categories is large: top-grade round brilliants have held value better than fancy shapes or smaller stones, and rough decline has been steeper than polished.

A substantial portion of the 2024-2025 decline is a post-pandemic cyclical correction. Demand for jewellery diamonds peaked in 2022 against a backdrop of post-lockdown wedding catch-up, accumulated household savings, and unusually strong retail trade. Inventory built up across the supply chain in late 2022 and 2023 as wholesale buyers anticipated continued demand, and the subsequent slowdown in retail throughput in 2023-2024 forced the supply chain to work down that inventory by holding back rough purchases and discounting polished.

De Beers' Sights cycles, the company's structured rough-diamond sales to approved sightholders, were repeatedly reported as offering reduced sight values through 2024 and into 2025³. Several sightholders publicly declined sights or took partial allocations during the period, which is unusual and a clear market signal. ALROSA, the second-largest natural-diamond producer, faced compounded pressure from sanctions-related export complications.

A cyclical correction of this kind is not unprecedented. The natural-diamond market saw a comparable correction in 2019-2020 (compressed by the pandemic's effects in 2020), an earlier one in 2015-2016, and an older one in 2008-2009. The shape of the recovery from those earlier cycles was typically a return to or above prior levels within three to five years, driven by continued demand growth from emerging-market jewellery buyers and by tightening supply from existing mines.

The new variable in this cycle, absent from the earlier ones, is the structural share gain of lab-grown diamonds. Bain reporting consistently tracks lab-grown's share of polished jewellery-diamond sales by volume and by value, and the share has grown from negligible in 2018 to a meaningful single-digit-to-low-double-digit percentage of value by 2024². The lab-grown share is concentrated in the engagement-ring segment in the United States, where the mainstream market for one-to-two-carat centre stones now routinely includes both options at the retailer counter.

The implication for natural-diamond pricing is selective. Where lab-grown is substituted for a natural stone (the buyer would have bought natural and instead bought lab-grown), it removes demand from the natural market. Where lab-grown is incremental (the buyer would not have bought a diamond at all and bought lab-grown), it does not affect natural demand. The empirical question is what share of lab-grown purchases is substitutionary versus incremental, and the trade-press estimates are mixed, with substitution rates from low-single-digit to high-single-digit percentages of natural-diamond demand.

The structural element is therefore the smaller of the two near-term effects on natural prices (the cyclical correction is larger) but the more persistent one. A cyclical correction tends to reverse within a few years; a structural demand shift tends to compound. The full data on lab-grown share and its growth trajectory is in Chapter 9.

A clean market signal of how the natural-diamond outlook was being read at the corporate level came in 2024 when Anglo American, the parent company of De Beers, announced as part of a strategic update that it would separate or divest the De Beers business as part of a broader portfolio simplification⁶. De Beers had been a core part of Anglo American's portfolio for decades and the divestiture announcement was widely interpreted as Anglo American's reading that the medium-term outlook for natural-diamond mining no longer justified the capital and management attention.

The announcement was not a forecast of permanent natural-diamond decline; the trade-press reading was that De Beers' rough-diamond business was facing margin and demand pressure that made it a non-core asset for a diversified mining conglomerate. Subsequent updates through 2024 and 2025 confirmed the separation intent without yet completing the transaction, and the structure remains under active consideration as of early 2026. The signal stands regardless of the eventual structure.

De Beers itself launched and then closed Lightbox, its lab-grown jewellery brand, during the same period. Lightbox launched in 2018 at eight hundred dollars per carat, cut prices to five hundred dollars per carat in 2024, and closed in 2025. The Lightbox arc is documented in Chapter 8; the strategic reading was that De Beers' own attempt to set a lab-grown price floor that would protect natural pricing did not survive contact with the third-party lab-grown market.

The shorter the timeframe, the worse the natural-diamond market looks in 2026. The longer the timeframe, the more nuanced the picture. The long-run series of natural-diamond wholesale prices, going back several decades and adjusted for inflation, shows a market that has had multiple major drawdowns and multiple recoveries. The current drawdown is meaningful but is not yet at the depth of the 2008-2009 episode in real terms.

The question of whether 2026 marks a structural shift or a deep cyclical low is unanswerable from inside it. The market data of 2027-2028 will determine which interpretation was right. A buyer making a 2026 purchase decision on the basis of resale value should be aware that even in the more optimistic interpretation, natural-diamond prices have not been a reliable appreciating asset, and the lab-grown share-gain element of the current downturn is genuinely new rather than purely cyclical.

The more honest read of the natural-diamond market in 2026 is that it is in a substantial cyclical correction overlaid on a smaller structural shift, with significant uncertainty about how each element evolves over the next three to five years. The trade-press consensus is that the cyclical element is closer to its bottom than to its top, and the structural element is closer to its beginning than its end. Both readings could be wrong.

For a buyer in 2026, the practical implications are limited. Retail prices to consumers have not fallen by the same percentages as wholesale, so the consumer-visible price reduction is smaller than the headline numbers suggest. Most engagement-ring transactions still happen at retail prices that are close to historical norms in nominal terms. The wholesale decline matters for the natural-diamond industry but is partially absorbed by retailer margins before reaching the buyer.

For a buyer comparing lab-grown and natural in 2026, the relative pricing has shifted somewhat in lab-grown's favour at the wholesale level but the retail comparison is closer to the historical pattern (lab-grown roughly thirty per cent of natural retail in the Bain reporting). The decision frame for the comparison is in the engagement-ring guide.

For a buyer holding existing natural diamonds, the resale gap to paid retail is somewhat wider than it was in 2022 but is broadly in line with the long-run twenty-to-fifty per cent recovery band. The most common honest answer to 'is now a good time to sell' is 'probably not, but no obvious time is much better.'

Cross-references

The full market-data picture is in Chapter 9. The lab-grown price-history side of the same story is in Chapter 8. The lab-grown resale comparison is in the companion appendix. The structural production-economics explanation is in Chapter 7.