When the COVID-19 pandemic struck last year, the idea of spending large amounts of money on expensive jewellery seemed crazy.
And while the diamond industry took a hit, it’s back in fashion in a big way.
The world's largest diamond producers have been upping their prices consistently this year as those countries coming out of the pandemic start spending again.
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Why are diamonds more expensive now?
Lots of people around the world are looking to buy diamonds again: whether it’s to treat themselves or finally pop the question after being restricted last year, demand is high.
Pair the growing demand with a lack of supply and you have the perfect conditions for rising prices.
There are two major players in the diamond mining industry and they are US-owned De Beers Group and Russian-owned Alsosa.
According to Stockhead both De Beers and Alosa have hiked prices to reflect “midstream demand”.
De Beers reported late last month it was increasing the price of rough diamonds, or diamonds that have yet to be polished and made to look like what you would expect when you picture a diamond, to $183 per carat.
Alosa followed the lead and also increased its prices by 7 per cent, according to Rapoport News.
Another factor contributing to the higher cost of diamonds is Aussie-owned Rio Tinto’s (ASX: RIO) Argyle mine closure.
The Argyle mine produced 90 per cent of the world’s supply of super rare pink diamonds.
It’s closure also meant the loss of around a sixth of the world’s diamond production which was a significant hit.
How can I invest in diamonds?
Just because De Beers and Alosa are the major players does not mean that there are no Aussie companies involved in diamond mining.
There are a number of ASX-listed companies which are looking to reopen Aussie diamond mining that you can invest in.
Lucapa Diamond Company (ASX: LOM) owns two mines in Angola (Lulo) and Lesotho (Mothae).
The company Lucapa is also achieving encouraging exploration results and recently acquired a historic diamond mine in the Northern Territory.
The second is Burgundy Diamond Mines (ASX: BDM) which is a diamond exploration company focussing on developing diamond projects that have either been overlooked, or underfunded in the past.
Then there is Gibb River Diamonds (ASX: GIB) which owns a mine and exploration license in Western Australia.
In fact, Gibb recently uncovered a special yellow diamond at its mine which was valued at over $60,500.
Another is Jindalee Resources (ASX: JRL) which is a broader mineral miner, so not just focused on diamonds but certainly not opposed to them either.
Finally, we have Astro Resources (ASX: ARO) which also owns a diamond mine is Western Australia along with a couple others that focus on other minerals.
While there isn't a diamond-specific ETF available to invest in, the BetaShares Resources EFT holds many of the above-mentioned miners.