De Beers sale revenue sparkles on Diwali need

De Beers reported provisional revenue of $572m for the sixth of 10 sales for the year, an improvement on the same time a year earlier as Indian demand for rough diamonds came forward to prepare for an earlierthan-usual Diwali.

The first six sales of the year have secured at least $3.505bn for the 85%-held Anglo American subsidiary, $53m less than for the first six sales of 2016.

De Beers CEO Bruce Cleaver said the sales, which topped $541m realised in the fifth sale and the $528m at the same time a year earlier, showed a “trend of consistently good demand” for the company’s diamonds.

Indian buyers moved their purchases forward from their normal buys in the seventh sale of the year to the sixth sales event, distorting the data. Based on the state of demand for rough diamonds, De Beers was ramping up its slowed Orapa mine in Botswana, giving the group a production target of 31-million to 33-million carats in 2017, Cleaver said last week.

De Beers noted a 12% fall in average diamond prices to $156 per carat it realised in the first half of the year from sales of 18.4-million carats, having mined 16-million carats.

At the end of 2016, De Beers struggled to sell low-value goods because of the demonetisation programme in India, which buys diamonds of less than $100 a carat for cutting and polishing.

De Beers sold up to 4-million carats of low-value diamonds in the first half of the year, a large quantity of which were below $50 per carat.

“Our average price will increase in the second half of the year because we’ve got no excess low-value carats,” Cleaver said.