Diamonds in the Safe: The Industry’s Oversupply Challenge – by Avi Krawitz ( – August 24, 2023)


Manufacturers, dealers and jewelers overbought during positive periods, ignoring the lessons of previous up-and-down cycles.

According to an old adage in the diamond industry, success is built on the way you buy, rather than how you sell. In that sense, the biggest challenge for the diamond and jewelry market presents itself during good times. That’s when the industry typically fails to control its urges, overbuying and leaving itself vulnerable during a subsequent downturn.

The diamond and jewelry market currently finds itself in that predicament. Had businesses bought wisely during the strong recovery from Covid-19 in 2021 and the first half of 2022, it would not be facing its current stressful scenario.

The inevitable pullback in the rough market, which is currently in play, typically results from aggressive buying, and mostly at inflated rough prices. This time, the same occurred in the jewelry segment, where retailers bought excessive volumes during the post-Covid-19 period.

While we have the benefit of hindsight, both jewelers and manufacturers could have drawn on the experience of previous diamond and jewelry market slumps to adopt a more cautious approach to their inventory management.

For the rest of this article: