The recent news from monopolized diamond industry are not very good. Rapaport reports that middle markets are under pressure due to the trade war with China and not gaining any significant profits to maintain the reliable supply chain. Diamond cartel even had to adjust the artificial Diamond Index and lower the prices, which are down 1.7% since the beginning of 2019.
Martin Rapaport, Chairman of the Rapaport Group had stated that “the middle markets are in danger of collapse. We are reaching the point where there is insufficient liquidity to support the flow of diamonds through the supply chain. If the trade does not change its business practices and adapt to new realities, the diamond industry will suffer extreme financial and regulatory disruption. Manufacturers will stop cutting.”
As for now, manufacturers reject high-priced raw diamonds that is making their work unprofitable. This is resulting in De Beers and Alrosa are slowly decreasing price levels. But this is not enough for polished suppliers to maintain the stability. Due to the unfavorable situation on the market, they sell blockchain source verification as a value-added service, which is one of the few options that gain interest among buyers.
In the next few years, the demand on overpriced diamonds is expected to decrease even more dramatically. And this will be the end for the monopolized diamond industry, which is unable to change its business practices and adapt to the new realities. Diamond Open Market is going to demonstrate a wholly new approach for diamond trading, with fair pricing and possibilities of not only buying, but also selling the diamond.