The value of De Beers’ rough diamond sales during the first cycle of 2016 improved significantly to $540 million, compared with $248 million in the final cycle of 2015, the company announced on Tuesday.
The miner said that a positive holiday season in the US from a retail perspective, low levels of rough diamond purchases by the midstream in the fourth quarter of 2015 and a subsequent reduction in manufacturing saw polished diamond stocks pull through the pipeline, which resulted in firmer polished prices.
Rough diamond demand broadened across the entire product range as cutting and polishing factories began to increase their activity, the miner said.
“We are encouraged by the result of the first sales cycle of 2016, and will keep working closely with our customers to deliver sustainable improvements in the diamond industry in 2016,” De Beers Group chief executive Philippe Mellier said.
Diamond sector outlook
Mellier says the start of 2016 has shown some encouraging signs for the diamond sector, who also cautions that any recovery seen so far remains delicate.
Some volatility can still be expected in 2016 Mellier noted as part of his sightholder reception address during the first De Beers Sight of 2016.
Highlighting some of the positive developments, Mellier stated: “We have seen polished diamond prices start to stabilise and even increase in certain areas. However, he also stated that there continues to be uncertainty regarding the macroeconomic outlook, currency pressures have the potential to weigh on downstream demand in a number of locations and we will need to see how retail restocking appetites develop.”