Global diamond production this year fell by more than 20% to about 113 million carats due to planned production declines by the major producers and significant pandemic-related suspensions and curtailments across the industry.

Mines including Ekati, Aikhal, Verkhne-Munskoye, Williamson, Liqhobong and Zarya have yet to resume production following suspensions in March, April and May. Canada’s Ekati mine, the largest in the group by production output, is estimated to have produced as much as five to seven million carats annually in recent years.

Unrelated to the pandemic, Rio Tinto’s Argyle mine in Western Australia marked its final day of mining in early November after having exhausted economic reserves. The mine produced 865 million carats of rough diamonds over its life and was the world’s largest producer of colored diamonds and the world’s primary source of pink diamonds.

Global diamond production might well remain well-off until at least 2025, after the most recent high-water mark reached in 2017 of 152 million carats.

Global demand for diamond jewelry, after growing at a low-to-mid single digit percentage in recent years, has been materially impacted by the coronavirus pandemic and related economic fallout, and it will likely be felt well beyond 2020.

While much uncertainty remains regarding the ultimate severity and duration of the current situation, global diamond jewelry demand could fall as much as 25% in 2020, possibly not recovering to pre-pandemic levels until 2022 or 2023, according to some industry experts.

However, jewelers globally have posted positive momentum in the second half of 2020, as is highlighted by sales data from Chow Tai Fook and Tiffany.

In the first quarter of this year, Chow Tai Fook saw sales fall about 45% relative to the year before. In the second quarter, sales fell another 20% before finally rebounding 3% in the third quarter. The market in mainland China clearly stood out as the market leader for the company, more than offsetting persistent weakness in Hong Kong and Macau he said.

Tiffany had a year-over-year sales decrease of 45% in the fiscal quarter ended April 30 and a 29% sales decrease in the quarter ended July 31. However, the trend significantly improved with a sales decline of only 1% for the three-month period ended October 31, driven by standout performance in mainland China where sales were up 70%.

China continues to be the bright spot and has shown to be the industry’s strongest consumer market in recent months, led in part by strong domestic luxury consumption by the Chinese as global lockdowns have essentially halted Chinese tourism spend in primary markets such as the Americas, Western Europe and Japan. Despite the pandemic, in the third quarter, Chow Tai Fook actually opened 257 net new stores in the mainland, boosting the company’s store count by over 6% to 4,150.

Some specialists expect consolidated rough diamond prices will fall between 5% and 10% in 2020, followed by a recovery of a high single-digit percentage in 2021 and a subsequent slight decline in 2022, as some supply returns to market.