CPD exports to contract by 18-19%; sector outlook remains negative: Report

With continued decline in demand in key markets like the US and China, cut and polished diamond (CPD) exports are likely to decline by 18-19 per cent in 2024-25, a report said on Thursday.

CPD exports are estimated to decline 18-19 per cent year-on-year to decade-low levels of USD 12.5-13 billion in FY25, led by a 13-14 per cent fall in volumes, along with the softening of average realisations by 5-6 per cent, Rating Agency Icra said in its report.

According to the Icra report, CPD exports from India contracted by 28 per cent in FY24 due to the worsened global macroeconomic conditions and increased competition from lab-grown diamonds (LGD).

With sustained subdued demand conditions in the two key consuming markets - the US and China - the downturn in exports continues as the industry is witnessing a 19 per cent contraction in CPD exports in the first four months of FY25.

The US demand contracted due to inflationary pressures and in China on account of changing consumer preferences a