Diamonds are plunging in value around the world. Is China to blame?

Not all newlyweds in China can afford a name-brand, natural diamond in today’s tough economy. But many no longer want one, anyway.

Prices for natural gems have fallen worldwide, tainting their store of value, while synthetic alternatives cost far less and glitter just as brightly.

“They don’t necessarily need something from Tiffany’s,” said Vivian Wu, a 40-year-old founder of the Shanghai-based diamond business Wei An Shang Mao.

Wu still completes about 10 diamond orders per week, as she has for years, but these days customers are often looking for a bargain. Newlyweds increasingly ask her to find smaller gems to fit their shrinking budgets or choose artificial ones that are sometimes just one-tenth the price of a natural stone.

Changes taking place in China are rapidly reshaping the global diamond market, as the country’s consumers pull back from splashing out on natural stones and its factories ramp up production of cheaper synthetic alternatives.

Wholesale diamond prices have fallen by about 40 per cent over the past two years, according to Bank of America Global Research. The Zimnisky Rough Diamond Price Index shows a particularly steep drop since an all-time high in 2022.