There may not be snow on the ground yet on Bay Street, but Christmas could come early this year for Canada's diamond miners who are among the few with the gems to supply growing global demand for high-end jewelry.

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In the world's largest diamond market -- the United States -- upscale retailers like Tiffany & Co and Harry Winston are seeing higher sales as demand for $50,000 engagement rings rebounds.

Diamonds are also the new gold for an emerging upper middle class in China, India and Russia. And they offer a safe-haven substitute for volatile currencies.

Analysts say maximum global diamond extraction rates, or "peak diamond", have come and gone, with little chance of another massive diamond discovery to replace aging mines.

And while Russia still has $1 billion worth of diamonds stockpiled from the global financial crisis, Moscow has said it does not have plans to start selling them into the open market.

That all adds up to good news for Canadian miners. In 2009, the country was the world's number three diamond producer, mining $1.47 billion worth of rough stones.

With new discoveries in the Northwest Territories, Quebec and Nunavut, Canada could become the world's top producer -- and with lust growing for the sparkling jewels, analysts expect to see some projects fast-tracked.

"For companies who have real diamond prospects, real potential to mine, it's going to become easier for them to raise money." said RBC Capital Markets analyst Des Kilalea. "And that's going to be quite good for Canada."

Kilalea said at least two new mines would likely come on line in Canada within the next five years, coincidentally the same timeframe when global diamond production output is expected to start to decline.

"There's a multitude of Canadian companies that are looking," he said, listing explorers like Peregrine Diamond and Shore Gold. "So it's likely to be a growing space for Canadian investors."

He said that Mountain Province Diamonds and Stornoway Diamond are leading the pack, adding that bringing a new diamond mine online takes over a decade.

Mountain Province's 51 million-carat Gahcho Kue mine in the Northwest Territories, which is a joint venture with global diamond giant De Beers, is expected to be in production by 2014.

"Gahcho Kue was the last major discovery, and that was 15 years ago," said Mountain Province Chief Executive Patrick Evans.

"There are further deposits out there, and further big mines will be discovered," he said. "The demand for rough diamonds is going to continue to increase."

By Julie Gordon