Israeli Diamond Industry Faces Significant Declines Amidst War of Iron Swords

In the midst of the ongoing War of Iron Swords, the global and Israeli diamond industry continues to grapple with a negative trend that has persisted since the outbreak of the conflict in Ukraine. Disturbing statistics for the first eleven months of the year reveal widespread declines across all four main trade categories, signaling a challenging period for the diamond market.

Rough Diamonds Trade:

The net import of rough diamonds to Israel has plummeted to approximately $843 million, marking a staggering 50% decrease compared to the corresponding period last year. November witnessed an even more alarming downturn, with a 75% decrease compared to November 2022. Concurrently, the net export of rough diamonds during the same period amounted to approximately $637 million, showcasing a significant 57% decline compared to the first eleven months of 2022. In November alone, there was a drastic 68% decrease compared to the previous year.

Polished Diamonds Trade:

The net import of polished diamonds in the first eleven months of the year hit approximately $2.07 billion, reflecting a substantial 30% decline compared to the same period in 2022. November saw a 26% decrease compared to November last year. On the export front, net polished diamonds, valued at around $3.37 billion, experienced a 9% decline compared to the corresponding period in 2022. However, there was a surprising twist in November 2023, with a 177% increase compared to the same month last year.

Impact of the War on Trade Dynamics:

Ofir Gore, the supervisor of diamonds at the Ministry of Economy and Industry, underscored the visible impact of the war on the Israeli diamond industry. Gore explained, "The war joins the negative trend that has accompanied the global diamond industry since the beginning of the war in Ukraine. Most of the damage appears to have originated in the first two weeks after the outbreak of the war, primarily due to issues with the transportation of goods. However, subsequent data suggests that the industry has found solutions, and the declines have moderated significantly."

Gore further emphasized that the Ministry of Economy and Industry has taken proactive measures to support the struggling industry. "Already in the first week of the war, we published a series of regulatory reliefs designed to help the industry survive the difficult period. We will continue to monitor the situation and try to help where necessary."

Trade Dynamics with the United Arab Emirates:

In the last month, Israel's export of rough diamonds to the United Arab Emirates amounted to approximately $9.5 million, constituting approximately 40% of Israel's overall export of rough diamonds in November. Simultaneously, rough diamonds worth about $10 million will be imported from the United Arab Emirates to Israel this month, making up about 34% of the total rough diamonds imported to Israel in November.

As the Israeli diamond industry navigates the challenges posed by the War of Iron Swords, stakeholders remain vigilant, hoping for a recovery in the coming months and continued government support to weather these trying times.