Jun 17, 2021 - Economy

Diamonds see demand spike and prices follow


Illustration: Aïda Amer/Axios

Diamond prices are up because demand is growing — despite the country's recent emergence from various forms of lockdown.

Why it matters: Diamonds were a big pandemic-era winner, when U.S. spending flowed out of service, travel and experiences into goods and high-end products.

  • The trend hasn't reversed, with increases in online sales, younger men who are less anxious about going into stores, and purchases of larger stones. 

By the numbers: De Beers, one of the biggest diamond miners in the world, has already reached 73% of its 2020 rough diamond sales so far this year.

  • E-commerce sales for Signet, the parent company of Kay Jewelers and Zales, grew 125% over 2019 in the latest quarter, thanks to its virtual consultants and try-on features, the company says.
  • And even though store foot traffic may still be down compared with two years ago, the company reported a higher average transaction value.

What hasn't changed: Celebs are still coveting the precious stones, and there's still tremendous value in rarity.

  • Check out rapper Post Malone’s new 12-carat, $1.6 million fangs and the new 470-carat diamond that was just discovered in Botswana.

The big picture: Jewelry and accessories have been one of the biggest drivers of retail growth, especially online, over the past year.

  • Jewelry sales saw the biggest jump of any retail category — up 45% last month versus 2019 — according to Mastercard.

What to watch: New strains of the coronavirus may impact supply chains for diamonds down the line.

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