Amid price increases caused by the war in Russia, a shortage of stones, and young consumers’ growing interest in digital and sustainable production, the diamond industry is facing new challenges. Vrai and The Clear Cut are looking for solutions in the form of lab-created diamonds and NFT product passports.
According to Bloomberg, the prices of rough diamonds used for smaller settings have jumped about 20% since the start of March as diamond supply has stalled. The U.S. imposed sanctions in February on Russian company Alrosa PJSC, which is responsible for one-third of global diamond production alongside American De Beers and Debswana Diamond Company in Botswana.
With a looming economic downturn and recession, the diamond industry is facing a tough call. During the 2009 recession, the industry shrank, with De Beers losing 80% of profits.
This time around, it won’t be so simple. The conflict in Russia means that American and European companies are turning away Russian stones, while India and the Middle East are still accepting them. With rough diamonds being sorted by weight and size and transported multiple times across the globe with no individual tracking, knowing where each diamond was sourced is almost impossible. Diamond traceability is also tough to implement within the industry’s antiquated supply chain.
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