De Beers diamond sales improve but still lower than a year ago
Despite a big price cut, sales still remained lower than normal for this time of year
13 November 2019 - 11:05
byThomas Biesheuvel
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
London — De Beers sold the most diamonds since June after the biggest price cut in years, but sales still remained lower than normal for this time of year as the industry’s cutters and traders struggle to make money.
De Beers sold $390m of rough diamonds in November compared with $297m at its previous sale, the Anglo American unit said in a statement on Wednesday. Still, it is the first time De Beers has sold less than $400m at its November sight since at least 2016.
The industry is going through something of a crisis as De Beers’ buyers grow increasingly frustrated with the cost of rough diamonds as the price of polished gems slump. That’s led to wafer-thin margins and in some cases losses from the stones bought from De Beers and Russian rival Alrosa.
De Beers sells its gems through 10 sales each year in Botswana’s capital, Gaborone, and the buyers — known as sightholders — generally have to accept the price and the quantities offered. The sightholders are given a black and yellow box containing plastic bags filled with stones, with the number of boxes and quality of diamonds depending on what the buyer and De Beers agreed to in an annual allocation.
De Beers has responded by offering more flexibility to its customers, allowing them to reject some purchases, and this month it cut prices across the board by about 5%.
The sale “saw an improvement in sentiment from rough diamond buyers,” De Beers CEO Bruce Cleaver said in the statement. “Global consumer demand for diamond jewellery at the retail level continues to be broadly stable but, with midstream trading conditions still in the process of rebalancing, we offered sightholders further flexibility during the sight to provide support.”
De Beers sales so far in 2019 are down more than $1.2bn from the same time in 2018.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
De Beers diamond sales improve but still lower than a year ago
Despite a big price cut, sales still remained lower than normal for this time of year
London — De Beers sold the most diamonds since June after the biggest price cut in years, but sales still remained lower than normal for this time of year as the industry’s cutters and traders struggle to make money.
De Beers sold $390m of rough diamonds in November compared with $297m at its previous sale, the Anglo American unit said in a statement on Wednesday. Still, it is the first time De Beers has sold less than $400m at its November sight since at least 2016.
The industry is going through something of a crisis as De Beers’ buyers grow increasingly frustrated with the cost of rough diamonds as the price of polished gems slump. That’s led to wafer-thin margins and in some cases losses from the stones bought from De Beers and Russian rival Alrosa.
De Beers sells its gems through 10 sales each year in Botswana’s capital, Gaborone, and the buyers — known as sightholders — generally have to accept the price and the quantities offered. The sightholders are given a black and yellow box containing plastic bags filled with stones, with the number of boxes and quality of diamonds depending on what the buyer and De Beers agreed to in an annual allocation.
De Beers has responded by offering more flexibility to its customers, allowing them to reject some purchases, and this month it cut prices across the board by about 5%.
The sale “saw an improvement in sentiment from rough diamond buyers,” De Beers CEO Bruce Cleaver said in the statement. “Global consumer demand for diamond jewellery at the retail level continues to be broadly stable but, with midstream trading conditions still in the process of rebalancing, we offered sightholders further flexibility during the sight to provide support.”
De Beers sales so far in 2019 are down more than $1.2bn from the same time in 2018.
Bloomberg
De Beers data confirms diamonds having one of their worst years
De Beers keeps August sale policy for Botswana customers
De Beers’s sales down $1bn so far in 2019
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Most Read
Related Articles
Diamond sales at De Beers plunge ‘off proverbial cliff’
De Beers’ relationship with buyers sours as it refuses to lower prices
De Beers raises ad spend, predicts dip in global diamond output
Future is shinier for lower-quality diamond producers
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.