De Beers sees demand for rough diamonds as India recovers
DE BEERS, the world’s biggest diamond producer by volume, has reported a strong demand for its rough diamonds during its fifth sales cycle as India recovered from the fatal second wave of the Covid-19 pandemic.
De Beers, a unit of Anglo American plc which holds 10 sales cycles a year for its rough diamonds during sight holder sales and auctions, yesterday recorded a provisional fifth sales cycle value of $470 million (R6.71 billion).
The company said that owing to the restrictions on the movement of people and products in various jurisdictions around the globe, it had continued to implement a more flexible approach to rough diamond sales during the fifth sales cycle of 2021, with the Sight event extended beyond its normal week-long duration.
It said the sales cycle value was the provisional rough diamond sales figure quoted for Cycle 5 and represented the expected sales value for the period June 7 to June 22 and remained subject to adjustment based on final completed sales.
Chief executive Bruce Cleaver said with demand for diamond jewellery in the key consumer markets of the US and China continuing to be positive, and midstream capacity in India returning, the group had seen strong demand for rough diamonds during the fifth sales cycle.
“Overall sentiment is increasingly optimistic as we move towards the second half of the year and, while risks as a result of the global pandemic persist, we have been encouraged by the condition of the market,” Cleaver said.
De Beers reported that the value of its global sight holder sales and auctions had fallen to $385m – down from $450m a cycle earlier.
The producer said last month that the scale of the second wave of Covid-19 in India had led to a fall in midstream capacity and subsequently lower rough diamond demand, during what was already a seasonally slower time of year for midstream purchases.
India, where the majority of the world’s diamonds are cut and polished, has to date recorded 30 million Covid19 cases and 391 000 deaths.
The pandemic cases in the country started rising in mid-March, stretching hospitals to capacity with shortages of beds, oxygen supplies and even doctors.
De Beers guided that it would produce between 32 million carats and 34 million carats in 2021 subject to trading conditions and the extent of more disruptions due to the Covid-19 pandemic.
It said in April that quarterly production for rough diamonds during the quarter ended March 2021, fell 7 percent to 7.2 million carats, driven by operational challenges, including excessive rainfall in southern Africa and a Covid-19-related shutdown in Canada, as well as planned maintenance in Namibia.