As a rule, Americans purchase more than half of the world’s gem-quality diamonds, and last year was no exception. In 2006, U.S. retail diamond sales rose for the fifth year in a row, this time by an additional 6.1 percent. That’s not to say that U.S. buyers purchased more diamond jewelry; in fact, they bought less. Actual purchases declined by 2.7 percent even as diamond prices rose by 9.1 percent, so the rise in the average cost more than offset the loss in sales. Combined with double-digit sales growth in India and China, where the middle classes are expanding at a rapid rate, this generated $35.2 billion in worldwide sales — a full $2 billion over 2005’s figures.

The Diamond Information Center (DIC), the source of the 2006 figures, gives credit for the rise in sales to the diamond industry’s recent marketing initiatives. Not only has the industry worked hard to create new and innovative products that intrigue potential customers, they’ve coupled those products with appealing messages that make their product even more alluring. Not least, the industry has made a sincere (and effective) effort to publicize its zero-tolerance policy toward conflict diamonds, which are usually mined using slave labor to support civil strife in war-torn African countries. Under the Kimberly Process Certification Scheme, which follows diamonds from ground to industry, fewer than one percent of the annual diamond harvest can still be classified as conflict diamonds.

One new concept that’s really taken off in the U.S. is the Journey Diamond collection, which appeals to buyers with its “Love is a Journey” marketing campaign and its artistic combination of blue-white diamonds with 14K gold and white gold. Indeed, the Journey concept eclipsed the popular three-stone Past, Present, and Future jewelry concept, with 41 percent growth last year as opposed to 16 percent for three-stone jewelry.

The ever-popular diamond ring remained a hot item in 2006, with sales growing by a full 10 percent, the third year in a row for double-digit growth in that sector. According to the DIC, 69 percent of these rings are bought by men as gifts for the women in their lives, with the remainder being bought by the ladies for themselves. Most are purchased during the Christmas season. Last year, retail sales for diamond jewelry in the U.S. came to $5.5 billion for the holiday season, a 9 percent increase over 2005.

Diamond engagement rings continued their steady climb, both in terms of U.S. retail sales and general cost; Americans purchased $6.2 billion worth in 2006, a substantial rise over 2005’s $5.7 billion. However, the DIC cautions that that’s not because there were more brides this past year — in fact, the number remained more or less constant — but because the cost of the average diamond engagement ring rose to a high of $3,200, well above the $2,633 of just five years ago.

All things being equal, we might expect retail diamond sales to peak again in 2007. However, the industry has recently expressed worry about the Hollywood movie Blood Diamond, which depicts the conflict diamond trade during the Sierra Leone civil war of the 1990s. Although the Kimberly Process seems to have blocked actual conflict diamonds out of the market almost entirely, Hollywood and its celebrities are extraordinarily influential. It remains to be seen whether or not Leonardo DiCaprio and his film, which came out in December 2006, will chill American diamond sales for 2007.