Core Viewpoint - De Beers has cut rough diamond prices for the first time since December 2024, responding to declining demand, the rise of lab-grown diamonds, and trade disruptions affecting the global diamond market [1][4]. Group 1: Price Cuts and Sales - De Beers implemented price cuts on rough stones weighing more than three-quarters of a carat during its first regular sale of the year [2][9]. - The exact size of the price reductions remains unclear due to changes in billing and the composition of diamond boxes, complicating direct price comparisons [4]. Group 2: Market Conditions - The global diamond industry is experiencing one of its worst downturns in decades, with demand and prices for natural stones significantly declining from 2023 through 2025 [6]. - The rapid rise of lab-grown diamonds has led to a collapse in their prices, allowing them to capture market share, especially in the bridal segment, and undercut natural diamonds [8]. Group 3: Geopolitical and Economic Factors - China's weakening economy and declining marriage rates have negatively impacted demand for diamond jewelry, turning it from a growth engine to a drag on the industry [9]. - Geopolitical factors, including tighter sanctions on Russian diamonds and increased tariffs on Indian imports, have created additional challenges for the diamond supply chain [10]. - The US is the largest market for India's diamond industry, which processes approximately 90% of the world's diamonds by volume; however, higher tariffs have led to a significant drop in diamond exports from India to the US, with reports indicating a reduction of more than half [11].

Core Insights - The diamond market is facing a significant downturn due to global economic uncertainty and the rise of lab-grown stones, impacting producer revenues and leading to layoffs in mining companies [2][3] - The current tender and auction system for selling diamonds is deemed inefficient and opaque, likened to a casino, which exacerbates the crisis faced by the industry [3] - A proposed revamp of the sales process could allow producers to earn more by linking revenues to the polished value of diamonds rather than relying on opaque auction sales [4][5] Industry Challenges - The diamond market is experiencing its deepest crisis in history, with producers like Botswana suffering from reduced revenues [2][3] - Miners such as Burgundy and Lesotho's Letseng mine have had to lay off workers due to the downturn [2] Proposed Solutions - Oded Mansori of HB Antwerp suggests eliminating inefficiencies in the diamond sales process to help producers survive the price slump [1][3] - The profit-sharing model employed by HB Antwerp, which bases purchases on the estimated polished value of diamonds, could increase producer revenues by up to 40% [4][5] - HB Antwerp accounted for 72% of Lucara Diamond Corp's $74 million diamond revenue in the first half of the year, indicating the effectiveness of this model [5]