Global natural diamond supply is at 40-year lows as a production economics squeeze is leading to steep operational curtailment and multiple mines shuttering around the world
It’s difficult to overstate how much the diamond mining business has contracted in recent years.
This year natural rough diamond supply is forecast at under 95 million carats, according to Paul Zimnisky analysis (see below chart). This would mark the lowest output since 1987 —for context, the massive volume Argyle mine in Australia was just ramping up at the time and the world-class Venetia mine in South Africa was yet to commence production.
At 95 million carats, global supply would be down almost 40% from the over 150 million carats produced less than a decade ago.
While approximately 20 million carats per annum are currently being strategically curtailed by De Beers and ALROSA (MICEX: ALRS), at least five independent mines have been suspended or permanently closed over the last year alone.
Paul Zimnisky (left) underground at the Cullinan mine in South Africa in 2023. Source: Paul Zimnisky
For example: the Kimberly mine in South Africa, the Koidu mine in Sierra Leone, the Murowa mine in Zimbabwe, the Anjin Marange alluvial operation in Zimbabwe and the Braúna mine in Brazil, have all recently been put on care-and-maintenance or outright closed due to current market conditions.
Further, in just recent days, Petra Diamonds (LSE: PDL) suspended production guidance pending an “immediate cost and capital expenditure reduction assessment to preserve liquidity.” This implicitly includes the potential for a substantially earlier closure of both the Finsch and Cullinan mines —with the latter now shifting to a “high value” stone maximization mining plan which could significantly shorten the remaining life of mine.
Both assets are located in South Africa and contribute about two and a half million carats per year combined —Cullinan is notably the world’s preeminent source of fancy blue diamonds.
All of the above are substantial commercial operations providing material regional employment and economic stimulus.
In Canada, which has been the world’s third largest producer of diamonds for most of this century, operators are facing a similar situation.
Late last year, the owner of the Ekati mine said it was close to shutting down operations before the Canadian federal government stepped in with a $125 million credit lifeline. A few months later, it was announced that a capital project to take production at the neighboring Gahcho Kué mine beyond the next two years was halted.
Canada’s third mine, Diavik, officially ceased mining in March due to economic depletion following a planned multi-year phasedown.
Combined, the three Canadian mines produced a tenth of global diamond output as recently as last year while directly employing over 2,500 people plus an additional 1,500 through the peripheral economy —over a third of which are indigenous Canadians.
Flying over the Sable pit at the Ekati mine in Canada in 2024. Source: Paul Zimnisky
As is stands, the global diamond mining industry is shaping to be much more concentrated going forward.
Three primary entities are likely to control the very large majority of world’s natural diamond supplies for the foreseeable future: De Beers, ALROSA and Endiama. The former, which is currently up for sale, represents most of Botswana’s and Namibia’s diamond resource, ALROSA is the Russian diamond proxy and the latter represents Angola’s diamond interests.
Optimistically, with so much supply rapidly coming offline, the potential for a squeeze in natural diamond prices is unusually heightened following a multiyear decline that has taken prices down as much as 50% from the all-time highs reached in early-2022.
Paul Zimnisky (left) at the Kimberly mine plant in South Africa in 2023. Source: Paul Zimnisky
Near-term potential positive demand catalysts include a commitment from the new owner of De Beers (whoever that may be) to invest in a comprehensive program that ignites a new phase of growth in natural diamond demand.
With only three primary producer entities likely remaining, an effective collaborative and coordinated approach to global industry fundamentals appears to be well within reach as it pertains to unified marketing contribution and supply strategy.
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A press release that accompanied this report can be downloaded here.
Access more of Paul Zimnisky Diamond Analytics's recent content here:
PZDA Podcast with Sally Morrison, marketing executive De Beers (April 2026 appearance)
Paul Zimnisky exclusive for GJEPC on the uptick in large rough
Paul Zimnisky interview with trade website Rough & Polished
Paul Zimnisky interview with BNN Bloomberg TV
Paul Zimnisky, CFA is a globally recognized independent diamond industry analyst and consultant based in the New York metro area. For regular in-depth analysis and forecasts of the diamond industry please consider subscribing to his State of the Diamond Market, a leading monthly industry report; an index of previous editions can be found here. Also, listen to the Paul Zimnisky Diamond Analytics Podcast on iTunes or Spotify for exclusive full-length conversations with special guests from the gem and jewelry industry. Paul is a graduate of the University of Maryland's Robert H. Smith School of Business with a B.S. in finance and he is a CFA charterholder. He can be reached at paul@paulzimnisky.com and followed on X @paulzimnisky.
Disclosure: At the time of writing Paul Zimnisky held a long equity position in Brilliant Earth Group.