Industry view of this week (this week refers to February 7 to February 13, 2022, the same below)
In 2021, the global diamond consumption showed an obvious recovery trend, and the overall income of all links increased significantly year-on-year and exceeded the level in 2019: the diamond production and consumption data were released in 2021. In 2021, with the resumption of production, economic recovery and terminal consumption in various countries, the diamond mining consumption recovered significantly and exceeded the level before the epidemic in 2019, The revenue growth of the three major links of upstream rough diamond mining, midstream cutting and downstream retail was 62% / 55% / 29% year-on-year respectively.
Upstream mining links are in short supply. In 2021, the blank price was + 21% year-on-year, and the blank drill inventory hit a new low since 2013. In 2021, the upstream miners are expected to achieve a mining volume of 116 million carats, a year-on-year increase of + 5%, a certain recovery from 2020; The total sales volume reached 137 million carats, a year-on-year increase of + 27%. The recovery after the epidemic was significant, the supply was in short supply, and the inventory consumption was obvious. The inventory in the upstream link hit a new low since 2013, only about 29 million carats. Short supply has also driven the growth of overall prices. In 2021, the year-on-year growth rates of blank prices and bare diamond prices reached 21% and 9% respectively. Major diamond miners in the world have also raised prices for many times.
In 2021, global terminal retail sales increased by + 29% year-on-year to US $84 billion. The United States and China have recovered to the epidemic level, with year-on-year growth rates of 38% and 19% respectively.
We believe that the price of cultivated diamonds is anchored by natural diamonds and is the result of the equilibrium game among consumers, brands and channels. The larger the carat number, the higher the clarity and the better the color, the better the price of cultivated diamonds. At the end of 2021, the price of 1 carat natural diamond ring is mostly between 70000-100000 yuan, while the price of cultivated diamonds is mostly between 20000-35000 yuan, and the terminal retail price is basically stable at 1 / 3 of that of natural diamonds. The strong recovery of natural diamond terminal consumption, especially the rapid growth of sales in the United States, is essentially due to the economic recovery after the epidemic, strong consumer demand and increased demand for jewelry in various scenes. The high consumption of natural diamonds will also stimulate the vigorous development of the diamond industry.
We expect that global diamond consumption will remain high in 2022, and the consumption of gold and jewelry will pick up in the Chinese Spring Festival in 2022. It is recommended to pay attention to the potential double-click opportunities brought by the overall sector performance pick-up, recommend Chow Tai Seng Jewellery Company Limited(002867) , recommend to pay attention to Chow Tai Fook, Guangdong Chj Industry Co.Ltd(002345) , etc. Cultivated diamonds are also priced according to 4C standard, and the price is anchored to natural diamonds. The high consumption of natural diamonds will also drive the vigorous development of cultivated diamond industry. Recommend Henan Liliang Diamond Co.Ltd(301071) , pay attention to North Industries Group Red Arrow Co.Ltd(000519) , Henan Huanghe Whirlwind Co.Ltd(600172) , etc.
Risk tip: the epidemic situation is repeated, the prosperity of terminal consumption is declining, and the market competition is intensifying.
