“The factories in India, in Israel, in Belgium are not working, so there are not many goods in the market,” Dvash told Reuters.
He said the sector, which accounted for about 9% of exported goods in 2019, has lost around $300 million in profit due the crisis. It has a credit line with banks totaling about $850 million and industry leaders asked for government guarantees that would raise it to $1 billion, but that has yet to come.
The leading RapNet Diamond Index for 1-carat diamonds was down 8% this year. Dvash said he hopes prices will bounce back if and when demand returns.
Global rough production in 2020 is projected to decline 16% to 119 million carats by volume, and 29% to $8.5 billion by value, the lowest level since the 2009 recession, according to a Rapaport Research Report.
Health concerns are speeding up the transition toward digital platforms and away from traditional “mom and pop stores,” said Dvash.
Seeking an alternative, the World Federation of Diamond Bourses launched a new trade platform - a not-for-profit website called Get Diamonds - that in five weeks has collected an inventory of $5.5 billion in diamonds, the biggest in the world, he said. (Additional reporting by Steven Scheer Editing by Raissa Kasolowsky).
Source: Reuters