demand will be about $1.2 billion less than the $4.6 billion sold in each of the first three quarters of the year, Israel Diamond Institute chairperson Moti Ganz said this week.

He explained that reduced demand for cheaper and small diamonds in the US was partly offset by strong demand from the Indian and Chinese domestic markets. “But the consumers in these new emerging markets demand larger and higher quality goods.”

However, Ganz, also the president of the International Diamond Manufacturers Association and the Israel Diamond Manufacturers Association, believed the industry’s “recovery is continuing”.

Even with the current “technical correction” in the rough supply make-up, he said, manufacturers would process some $16.9 billion rough diamonds this year, a 27 per cent increase over the $13.3 billion of 2010.

Expressed in polished wholesale prices, diamonds available to the jewellery sector would grow by about 5.3 per cent from $18.9 billion to $21.9 billion this year.“The changing consumption patterns require a shifting of manufacturing focus in the cutting centres, which partly explains the unease in the rough markets, in which certain (cheap) goods cannot find buyers even at two-digit marker discounts, while goods which are in demand are hard to find.”

Ganz lauded the decision by the Diamond Trading Company Botswana (DTCB), a 50/50 joint venture partnership between the government of Botswana and De Beers, to limit the next sight allocation to $300 million, following the previous sight of $440 million.

The DTCB network hosts ten sales of rough diamonds a year, called ‘sights’.“These reduced allocations will further help to calm the market, which has recently seen vacillating prices in light of changing consumption patterns,” comments Ganz.