De Beers, the world's largest diamond producer, said today the economic slowdown in China and a strong US dollar meant a "challenging" year for the industry, while India would be key to future growth.
Analysts have said global diamond prices could tumble due to a glut as consumer demand weakens.
De Beers announced in July that its underlying earnings had slumped 23 per cent in the first half of 2015 and revised down its production forecast.
"We expect 2015 as a whole to be a more challenging year," said CEO Philippe Mellier in the company's new "The Diamond Insight Report".
"The continued strengthening of the US dollar against all major currencies, coupled with a slowdown in economic growth in China, is likely to lead to global diamond jewellery demand for the full year being relatively flat compared with 2014 levels," the report added.
Diamonds are typically denominated in US dollars.
Mellier predicted strong growth would return "once the current stocks have worked through the system".
Turbulence in the Chinese economy saw the devaluation of the yuan and a stocks crash.
It came on the heels of an anti-corruption drive by Chinese President Xi Jinping which has dented the luxury market.
"The challenge in China is that we all got used to growing at exorbitant rates... The industry is having to re-adjust itself," Stephen Lussier, CEO of De Beers' Forevermark jewellery brand, told AFP.
But the company is still "bullish" about China's role in future, says Lussier, who is in Hong Kong for a jewellery and gem fair.
China accounts for 16 per cent of global diamond sales, the second largest market after the US on 42 per cent. India is third with eight per cent.
In 2014 the US was the fastest growing consumer market, with a seven per cent increase in diamond consumption, according to the De Beers report.
China grew six per cent and India three per cent.
Global diamond jewellery demand rose three per cent to exceed USD 80 billion for the first time, the report said.
It highlighted India as a rapidly developing consumer market.
Despite the industry's tribulations, Lussier said fluctuations in rough diamond prices were unlikely to trickle down to consumers.
"If you look at diamond prices in local currency terms, in many countries they've gone up.