For most of history the diamond trade began in India. Stones from riverbed mines traveled overland and by sea to Persia, the Mediterranean and Europe, where Venice, Bruges and later Antwerp became trading and cutting centers. Brazil took over as the main source in the 18th century, and South Africa transformed the trade after 1867. De Beers then controlled most rough supply for about a century, until the system changed in the 2000s.
India and Golconda
India was the world's only known source of diamonds until the 18th century. Diamonds came from alluvial gravels along rivers in the Deccan, especially the Krishna basin. The mines around Kollur were among the richest, and Golconda, a fortified city near modern Hyderabad, became the main market. The name Golconda came to stand for exceptionally clear Indian diamonds. See the Golconda diamond mines.
Indian texts describe diamond grading and value many centuries ago, and rulers kept the largest stones for themselves. Stones reached the Mediterranean through trade routes running through Persia, Arabia and Egypt. Roman writers knew diamond, mainly as an extremely hard material.
European knowledge of the Indian mines grew in the 17th century through travelers. The French merchant Jean-Baptiste Tavernier made several journeys to India and wrote detailed accounts of the mines and markets. He sold diamonds to Louis XIV, including a large blue stone that was later recut, and whose surviving portion is the Hope Diamond.
Venice, Bruges and Antwerp
Venice controlled much of Europe's trade with the East in the late Middle Ages and was an early center for buying and polishing diamonds. Overland and sea routes brought Indian stones to the city, and from there they moved north.
Bruges, in Flanders, was a major northern trading city and had diamond polishers by the 15th century. As its harbor silted up, trade moved to Antwerp, which became the leading diamond city of northern Europe in the 16th century. Portuguese ships reaching India around the Cape of Good Hope after 1498 also shifted diamond shipments to Lisbon and on to Antwerp. The Bruges cutting history and Antwerp cutting history pages cover each city.
Amsterdam and London
After Spanish forces captured Antwerp in 1585, many merchants and cutters moved to Amsterdam. Sephardic Jewish families who had fled Spain and Portugal played a large part in Amsterdam's diamond business. The Dutch East India Company also brought Indian goods to the city. Amsterdam led diamond cutting through the 17th and 18th centuries (see Amsterdam diamond cutting).
London became the main center for rough diamond sales. English traders, with links to India through the East India Company, imported rough and sold it to cutters on the continent. That role continued through the 19th and 20th centuries.
Brazil in the 18th century
Prospectors found diamonds in Minas Gerais, Brazil, in the 1720s. The Portuguese crown quickly took control, creating a royal monopoly and restricting the diamond district around Diamantina. Enslaved Africans did much of the mining work.
Brazilian output was large enough to push down European prices for a time, and some merchants claimed the stones were Indian to protect value. By the mid-18th century Brazil had replaced India as the main source, a position it held until the 1870s. See diamond mines of Brazil.
South Africa from 1867
In 1867, a child found a bright pebble near the Orange River in South Africa. It turned out to be a 21-carat diamond, later named the Eureka. Larger finds followed, and in 1871 diamonds were found on a hill that became the Kimberley mine, the Big Hole. Thousands of miners rushed in.
South African production dwarfed earlier sources. Kimberley was also the first place miners worked diamonds in kimberlite, the rock named after the town. This showed that diamonds reach the surface in volcanic pipes, and that river gravels hold stones eroded from such sources. See diamond mines of South Africa and diamond geology.
De Beers consolidation
The early diggings at Kimberley were divided into small claims. As pits deepened, owners needed capital, and claims merged into companies. Cecil Rhodes built De Beers Consolidated Mines, formed in 1888, by buying out rivals, including Barney Barnato's Kimberley Central company. De Beers soon controlled nearly all South African production.
Producers and dealers set up a London syndicate to buy output and control supply. In the early 20th century, Ernest Oppenheimer and his Anglo American Corporation gained control of De Beers, and he became chairman in 1929. Under Oppenheimer the company set up a central selling organization that bought rough from De Beers mines and from many outside producers.
The single-channel era
From the 1930s until about 2000, most of the world's rough diamonds passed through De Beers's selling arm in London, later called the Central Selling Organisation and then the Diamond Trading Company. It sorted rough and sold it to approved buyers at regular sights. When demand fell, it held stones back to keep prices steady.
This single-channel system kept rough prices stable through depressions and wars. De Beers also funded large consumer advertising campaigns, including the slogan "A Diamond Is Forever," introduced in 1947. For decades, much Soviet rough was also sold through De Beers under marketing agreements. US antitrust law kept De Beers from operating directly in the United States for most of the 20th century.
Changes in the 2000s
Several changes ended the single channel by the 2000s. New mines in Canada (see diamond mines of Canada) and Australia's Argyle mine sold outside De Beers. Russian producers took more control of their own sales. In 2000, De Beers announced it would stop acting as the market's buyer of last resort and focus on its own production and brand.
Around the same time, the conflict diamonds crisis led to the Kimberley Process, launched in 2003 to certify rough shipments. Producer countries such as Botswana negotiated larger shares in mining and local sorting and cutting. De Beers moved its rough sales from London to Gaborone in the early 2010s.
From the late 2010s, growing production of lab-grown diamonds added a separate supply outside the mined diamond system. The present-day chain is described on the diamond pipeline page.
Frequently asked questions
Where did the first diamonds come from?
India was the only known source of diamonds until Brazilian deposits were found in the 1720s. Most came from river gravels in the Deccan, traded through Golconda.
When did De Beers start?
De Beers Consolidated Mines was formed in 1888 under Cecil Rhodes, after mergers of claims around Kimberley, South Africa.
What was the single-channel system?
From the 1930s until about 2000, De Beers's selling organization bought and sold most of the world's rough diamonds, managing supply to hold prices steady.
Why did diamonds become linked to engagement rings?
Diamond engagement rings existed for centuries among the wealthy, but they spread widely in the 20th century, helped by large advertising campaigns funded by De Beers.