This topic is about the myth of "Diamond abundance and high prices". Yes the two don’t seem to fit together, because if there was an abundance of a specific material, the price in correlation would be lower, but in this instance its not the case. So please read below to find out more.
When people ask me what I do for work or what I study, every so often I get brought up a topic about diamond prices being too high for such an abundant material. The conspiracy theory that diamonds are so abundant and that the De Beers have them locked in a vault to keep the high prices. Hence, I have finally decided to write on this particular topic and after concluding my studies at GIA with 8 weeks covering just the topic on Diamonds, I had access to a lot of material!
Perhaps that was the case once when there was an inflation of diamonds due to the recession in 1907 followed by the Great Depression in 1929 and when diamonds weren’t sold at all.
A large number of diamonds from the mines got accumulated over the period of time. Plus, the De Beers did purchase many rough diamonds mined from other mines others than their own to control the market prices. So that’s history and was already nearly over 100 years ago and people still talk about it!
Overall yes a “diamond” is perhaps an abundant material compared to some of the colored gemstones out there. What we should consider, however, is the time it takes to locate a mine for geologists, machines and labor costs are high in that field. For example, an Australian Argyle mine took 13 years to develop and have spent more than $430 million on just the production stages alone, not even mentioning the ongoing overhead costs throughout the years of mining.
The extraction process, some mines are located in uninhabited, remote areas so the companies have to create towns for their workers. On top of all other mining costs involved just to extract half a carat of a diamond it takes on average to go through 3.5 tonnes of ore! Not to mention that it is a natural material that took 4.2 billion years to form and eventually will come to a depletion.
Just to mention that after mining diamonds they need to get sorted as you may know there are various color grades and clarities. Followed by a cutting process and finally set into your beautiful jewelry by master jewelers! The process is long and overwhelming for a diamond!
Thank you for reading all this information and let me know if this was interesting! Tomorrow I will post more about diamonds! The topic is a surprise, so stay tuned!