Chinese millennials and those born after 1995, or Generation Z, are leading the world in buying diamonds and fuelling demand in the world’s second-largest diamond market, a study by De Beers has shown.
Buyers under 40 bought nearly 80 per cent of all diamond jewellery sold in China last year, compared to 60 per cent for the US, according to the study published on Thursday.
Young consumers in China buying diamonds for weddings and occasions are on the rise, creating a golden opportunity for diamond brands to tap, according to Bruce Cleaver, chief executive of De Beers Group, one of the world’s largest diamond miners.
“The parents of millennials in China have generally not been in the diamond tradition as much as their American counterparts, simply because we’ve been building the [American] market since the 1930s,” said Cleaver.
Hong Kong leads global trend of women buying diamonds for themselves, says De Beers
“This represents the opportunity in China, which I think is enormous.”
In 2017 China’s diamond industry accounted for 16 per cent of the US$82 billion global market, up from non-existence two decades ago.
The Chinese market expanded by 3 per cent last year, according to De Beers, recovering from a government crackdown on luxury spending during the previous two years.
Increasing disposable income, which has been growing at 12 per cent annually on average for the past decade, has been a major factor in driving growth, as well as better marketing of jewellery brands.
Average disposable income in China reached 25,974 yuan (US$3,793) last year.
Almost half of all Chinese brides received a diamond in 2017, up from less than 20 per cent in 2000. This compares with 70 per cent of brides in the more mature US market, contracting from the peak of 80 per cent of brides in the 1990s.
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In China the most popular size for wedding jewellery is between 0.14 to 0.49 carats, the study found, whereas for Americans the average size is more than one carat.
Women buying diamonds for themselves, a rising trend globally, made up a third of all diamond purchases in China last year.
Cleaver said the diamond giant would continue focusing on growing the natural diamond market in China, and had no plan to import synthetic lab-grown diamonds from the US.
De Beers broke with a long-held tradition in May when it unveiled plans to begin harvesting man-made diamonds and selling them to US consumers at a low price point. The strategy involves a U-turn that will see De Beers embrace the market for affordable, fun and fashionable diamonds in the world’s largest economy.
However, the initiative will remain a subsidiary business that will not cannibalise its natural diamonds business, Cleaver said.