2015 Global Rough Diamond Output Could Exceed 135 Million Carats

Independent analyst Paul Zimnisky published a report that analyzes the 54 largest diamond mines in the world and predicts that all told they will produce an estimated 135.5 million carats in 2015. That’s up from about 131.1 million carats the previous year.

The extensive report also gives a rundown of highlights from the 10 biggest mines and looks at upcoming mine openings and closures. In terms of prices, Zimnisky states:

Based on an analysis of the world’s 54 largest mines (see bottom figure), the global average price per carat for mined diamonds in 2015 is estimated to be $103 per carat, which would be a ~2% decrease from estimated 2014 prices. Last year prices were down an estimated 3-to-5% as the closure of Antwerp Diamond Bank in October led to industry-wide liquidity concerns for rough diamond buyers. In addition, a slower-growing Chinese economy, deflationary pressures in Japan and the EU, and multiple geopolitical tensions, led to downward pressure on rough prices which is expected to carryover into H1 2015.

A strong U.S. dollar also played a role in recent diamond price weakness, given that diamonds are typically denominated in dollars. However, this foreign exchange effect can also have a positive impact on miners that account for operating expenses in dollars; for instance, wages paid in local currency are relatively ‘less expensive’ when converted to dollars. A lower oil price should also have a favorable impact on miners as haul trucks, generators, and some grids are powered by diesel.

Click here to read the full report on Zimnisky’s website.