Diamond Stocks: News, Market Analysis and Sector Coverage

Natural diamonds form deep within the Earth's mantle, at depths of approximately 150 to 200 kilometres, where temperatures exceed 1,000 degrees Celsius and pressures are around 50,000 times atmospheric pressure. Under these extreme conditions, carbon atoms crystallise into the diamond cubic structure, which is the source of the material's extraordinary hardness. The diamonds are transported to the Earth's surface through volcanic eruptions that create kimberlite pipes, which are narrow, steeply inclined volcanic conduits that pierce through the crust. The journey from mantle to surface is rapid in geological terms and can occur over periods of hours to days during a volcanic event. Most diamonds found in kimberlite pipes are billions of years old, having formed in the mantle long before the volcanic events that brought them to the surface. Alluvial diamonds are found in river beds and coastal deposits where ancient kimberlites have been eroded and the diamonds concentrated by water transport.

Russia is the world's largest diamond producer by volume, with the Alrosa mining company operating extensive kimberlite mines in the Yakutia region of Siberia. Botswana is the second largest producer and, critically, produces the highest-value rough diamonds globally, with the Jwaneng and Orapa mines among the most productive in the world. Botswana's partnership with De Beers through the Debswana joint venture has made diamonds central to the country's economic development. Canada, the Democratic Republic of Congo, Australia, Angola, and South Africa are other significant producers. Australia was historically a major producer through the Argyle mine, which closed in 2020 after nearly 40 years of operation. Zimbabwe, Namibia, and Sierra Leone also produce meaningful quantities of rough diamonds. The geographic distribution of diamond production is somewhat broader than for some other commodities, though a relatively small number of mines account for the majority of global carats and value.

Diamonds have a wide range of industrial applications that leverage their unique combination of hardness, thermal conductivity, and chemical inertness. The largest use of industrial diamonds is as abrasives in cutting, grinding, drilling, and polishing applications. Industrial diamond abrasives are used in the manufacture of stone, concrete, ceramics, glass, and precision-engineered metal components. Diamond-tipped drill bits are essential in mining and oil and gas exploration. Wire drawing dies made from diamond are used in the production of fine metal wires. Beyond abrasives, diamond has exceptional thermal conductivity, the highest of any natural material, making it valuable as a heat spreader in high-power electronics and laser components. Emerging applications include diamond-based semiconductor materials for high-frequency electronics and diamond as a substrate for quantum computing components. The majority of industrial diamonds are now produced synthetically, which has become cost-competitive with mined industrial material.

Natural diamonds are formed over billions of years in the Earth's mantle under extreme natural conditions and are mined from primary kimberlite deposits or secondary alluvial deposits. Synthetic diamonds, also called lab-grown or man-made diamonds, are produced artificially using two main methods: high-pressure, high-temperature (HPHT) processes that replicate natural diamond formation conditions, and chemical vapour deposition (CVD), which grows diamond crystal layers from a carbon-containing gas. Both methods produce diamonds that are physically, chemically, and optically identical to natural diamonds; they cannot be distinguished without specialised gemological testing. Lab-grown diamonds have disrupted the gem diamond market by providing a lower-cost alternative to natural stones. Prices for lab-grown diamonds have fallen sharply as production has scaled, creating significant pricing divergence between natural and synthetic gems. The industrial diamond market is now dominated by synthetic material.

Pink and red diamonds are among the rarest and most valuable gemstones in the world, with prices per carat that can exceed those of colourless diamonds by orders of magnitude. Their colour arises not from trace element impurities, as is the case with most other coloured diamonds, but from a structural deformation of the diamond crystal lattice that causes selective light absorption. This deformation, believed to occur during the diamond's transport from the deep mantle to the surface under specific conditions of heat and pressure, affects only a tiny fraction of diamonds. The Argyle mine in Western Australia, which closed in 2020, was responsible for approximately 90 percent of the world's supply of pink diamonds over its operational life. The mine's closure has dramatically reduced global supply, and the combination of extreme rarity, unique geological origin, and concentrated historic supply has made Argyle pink diamonds particularly sought after as collectible assets.