2024 Israeli Diamond Sector Sees Dramatic Revenue Downturn

A turbulent chapter closes for the Israeli diamond industry in 2024, a year marked by relentless challenges and uncertainty. Yet, as the dust settles, an unexpected brilliance emerges—offering a glimmer of hope and promise for the future.

The year 2024 cast a heavy shadow over the global diamond industry, with Israel bearing the brunt of its unforgiving blows. The relentless downward spiral that began with the outbreak of the war in Ukraine in February 2022 continued to haunt the industry, its grip unyielding. In Israel, the challenges were compounded by the devastating October War, leaving the diamond sector to navigate a storm of unprecedented turmoil and uncertainty.

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Globally, the Russia-Ukraine war led to sanctions imposed by the Western bloc, which led to changes in global trade routes and price levels, explained Israel’s Dual-Use Diamond and Export Control Administration. The diamond industry was also hit by demand for a synthetic substitute, lab-grown diamonds, mainly in the global engagement ring market.

At the local level, trade was affected by the “Iron Swords” war. It began with a complete decline in incoming tourism, a decrease in the consumption of luxury goods and a decrease in the number of flights to and from Israel, and hence a damage to the transport of diamonds in the world. Diamond traders, who are required to adapt to the new situation, naturally find alternative ways to increase their scope of business by expanding into additional related industries – the jewelry industry and the gemstone industry. As mentioned, the local damage came against a background of a global market that was already weak.

Despite the bleak figures dominating much of 2024, December brought an unexpected glimmer of optimism with a staggering 270% increase compared to the same month in the previous year. Total net exports of polished diamonds for 2024 reached approximately $1.87 billion, reflecting a sharp decline of 35% compared to 2023. Similarly, net imports of polished diamonds stood at $1.5 billion, marking a comparable decrease of 33% year-over-year. However, December 2024 softened the blow, showing a more moderate decline of just 15% compared to December 2023.

Overall, net exports of rough diamonds in 2024 amounted to $634 million, a decrease of 24% compared to 2023 (when last December saw a decrease of 40% compared to December last year). In 2024, net imports of rough diamonds to Israel amounted to approximately $800 million, a decrease of 13% compared to 2023 (last December saw a decrease of 37% compared to December 2023).

On an annual basis, said Israel’s Dual-Use Diamond and Export Control Administration, there was a 35% decline in the polished diamond trade and a nearly 25% decline in the rough diamond trade. The polished diamond trade balance is positive with a surplus of $321 million (compared to almost twice last year). The rough diamond trade balance is negative with $165 million (compared to just under half last year).

In the field of polished diamond exports (gross data), the US maintains its position as Israel’s leading export destination with approximately 55% of exports, with Hong Kong in second place with 18% and Switzerland in third place with 7% of exports this year. In the field of polished diamond imports (gross data), India is in first place with more than a quarter of the diamonds imported from it, Belgium in second place with 19% and Hong Kong in third place with approximately 18% of imports this year.

In the field of rough diamond imports (gross data), the United Arab Emirates stands with approximately 35%, Belgium in second place with nearly a quarter of imports and Botswana in third place with 11% of total imports. In the field of rough diamond exports (gross data), India stands in first place with approximately 50% of exports, the United Arab Emirates in second place with 16% and Belgium in third place with 13% of total exports made from Israel this year. Belgium lost its first place as a destination for polished and rough diamond exports compared to 2023 and slipped to second and third place respectively in 2024.