Question

What does the diamond market say about suppliers and demanders?

Answer 1

A study from Bain and company examines the factors that influence buyers and sellers of diamonds, their midstream performance an overall market demand.

Because of the monopoly of De beers company on the diamond market, they control all the fluctuations in the market. For example, the supply has always been kept low as compared to demands even though there is a huge stockpile of inventory available. The trick is to keep the cost increasing according to the law of demand and supply.

The trend of engagement rings made up of different shapes and colors of diamond have spread all over the world and mostly in western countries has contributed significantly in the uprise of the demand industry.

There's also ethical and environmental trend involved.

If looking at the history of the diamond industry, De Beers company was doing tremendous business in the same but after the great depression, the demand fell drastically with piled stocks of supply.

De beers then launched a "propaganda in various forms" and came up with one of the most successful advertising campaigns of all time.

"Article on De Beers advertising campaigns"

De Beer relinquishes its monopoly over the diamond market 2000 but due to stockpiling of this gemstones, the prices remain inflated.