Gen Z generation to be biggest diamond jewelry consumers after 2025

Mumbai, Sep 13 (PTI) The Gen Z generation, aged currently, up to 20 years, is going to be the biggest diamond jewelry consumers after 2025, the De Beers Group has said.

Gen Z is a larger consumer generation, representing 35 percent of the world's population and will come of age as diamond consumers over the coming decades, according to data published Thursday by De Beers Group in its Diamond Insight Report.

"We expect the Gen Z to represent the biggest share in diamond jewelry consumption after 2025," De Beers Group Head of Strategy Esther Oberbeck told PTI. The Gen Z is bigger than the millennial generation and represents 2.6 billion or 35 percent of the world's population.

Of this, 20 percent live in India and 13 percent in China, but nearly two-thirds (63 percent) are outside of the top four diamond-consuming nations. India is the youngest major diamond-consuming country, where millennials and Gen Z account for 70 percent of the population.

Despite being a long way from financial maturity, Gen Z is already making its presence felt in the diamond market, with the oldest Gen Z consumers (those currently between 18 to 20 years of age) acquiring five percent of all diamond jewelry pieces in the US last year, it added.

Further, the report said, millennials and Gen Z are the most populous generations in the world today and since their spending power is rising, they are important drivers of growth in the luxury sector and account for a considerable share of global diamond jewelry demand.

Meanwhile, it said, the millennial (aged 21-39 years) and Gen Z generations combined accounted for two-thirds of global diamond jewelry sales in 2017, as diamond jewelry demand reached a new record high of USD 82 billion.

At present, millennials represent 29 percent of the world's population and are the current largest group of diamond consumers. Meanwhile, in India, rising inflation, higher interest rates, and a weakening rupee may pose a challenge to consumer demand, the report said.

Larger organized retailers are expected to continue to grow share of sales at the expense of smaller independents, it added.

On diamond supply, the report said that total diamond production in 2018 is expected to fall slightly from 2017 levels, due to mining companies like ALROSA's suspension of operations at the Mir mine in Russia and Rio Tinto's guided fall in production at its operations.

Looking further ahead, it said, production is expected to continue falling as new projects and expansions fail to replace lost output from closing mines.

By 2025, it added, several large mines will reach the end of their lives, while only a few new projects are in the pipeline.