Natural diamond market remains under pressure as De Beers cuts output guidance

De Beers is trimming output again, and that is not the kind of move that signals a clean recovery. Anglo American cut De Beers’ 2026 production guidance to 21 million to 26 million carats from 26 million to 29 million, even as first-quarter production rose 17 percent to 7.1 million carats on planned ore release at Gahcho Kué in Canada and higher volumes from Venetia underground in South Africa.

The numbers behind 2025 were harsher still. De Beers finished the year with underlying EBITDA of minus $511 million, compared with minus $25 million a year earlier, on production of 21.656 million carats and sales of 20.946 million carats. Its average realized price fell to $142 per carat from $152, a reminder that the market’s problem is not simply volume, but value. If a rebound is real, it should show up first in price stability and healthier inventory movement. Instead, the price line is still leaning down.

Anglo American has been preparing to separate and sell De Beers, after marking down the unit’s value by $7 billion over three years and booking a $2.3 billion pre-tax impairment tied to De Beers in its 2025 results. That is the corporate backdrop to the mine-level stress now rippling through the trade. In April, Arctic Canadian Diamond Company sought insolvency protection for Ekati, a mine that has long been central to Canada’s diamond story. The Canadian government said in December that the sector supports more than 1,000 Northerners and close to 20 percent of the Northwest Territories’ GDP, then backed Ekati with a $115 million federal loan and later added another $60 million in credit support.

The supply picture is tightening by design, but that does not yet amount to renewed demand. De Beers said rough diamond trading remained difficult in 2025 and 2026 amid industry, geopolitical and tariff uncertainty, and it said the improvement seen in the first half of 2025 was undermined by new U.S. tariffs on diamond imports from India. India remains the main cutting center for natural diamonds and a critical link in the jewelry pipeline.

Demand is also being pulled in different directions. Edahn Golan’s estimate that synthetics now make up 50 percent or more of the U.S. engagement ring market helps explain why smaller and lower-quality natural diamonds remain weak, even as better, larger stones have recovered in some segments. Some retailers are retreating from lab-grown stones because gross profit on those sales is often thinner than on naturals after price declines. Paul Zimnisky has estimated global natural diamond supply at just over 100 million carats in 2025, the lowest annual output since 1992, with 2026 only recovering to about 105 million. That is a constrained market, but not yet a healed one.