The price of diamonds is collapsing

Diamond Prices Expected To Continue To Drop Throughout 2015

Market prices for diamonds are in a long, slow, five-year decline and it's causing havoc for diamond producers.

Petra Diamonds reported a 10% sales drop in the first half of the year to $425 million today, while luxury brand De Beers saw a 23% collapse in profits to $360 million last week.

The diamond price is to blame, driven by falling demand in, you guessed it, China. Diamond prices have dropped about 12% over the last five years.

Here's the Idex diamond benchmark over the last five years:


Photo credit: Yahoo Finance

And here's what that's done to the Petra share price this year:

PETRA_DIAMONDS_Share_Price_Chart___PDL_L_ _Yahoo__UK___Ireland_Finance

Photo credit: Yahoo Finance

De Beers, 85% owned by mining company Anglo-American, said that Chinese retailers hold more inventory than they first thought.

They were hit by a slowdown in luxury spending in Hong Kong and Macau, which in turn has been blamed on the Chinese government's corruption crackdown.

All types of precious commodities are getting hammered this year as traders watch China struggle to maintain its 7% GDP growth target in the wake of an unraveling stock market.

Last week gold had a mini flash crash, falling 4% in matter of seconds to test, while platinum prices have fallen to $1148 from above $1240 at the start of the year.

It's a bad year for mining, but maybe a good one for buying an engagement ring.

NOW WATCH: 50 Cent testifies his lifestyle is an illusion

See Also:

More from
Diamonds can now be created from common food
Read Full Story
  • DJI27219.5237.070.14%
  • NIKKEI 22521988.29228.681.05%
    Hang Seng27352.69265.060.98%
  • USD (PER EUR)1.110.00000.00%
    USD (PER CHF)1.010.00000.00%
    JPY (PER USD)108.100.00000.00%
    GBP (PER USD)1.250.00000.00%