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De Beers Pre-Diwali Sales Beat Expectations

Oct 5, 2016 7:57 AM   By Rapaport News
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RAPAPORT... De Beers sold $485 million of rough diamonds in its eighth sales cycle of the year, exceeding expectations in a seasonally quiet period ahead of the Diwali holiday in India.

While the figure for September is still the lowest for this year, sales soared 57 percent from a year ago when demand hit rock-bottom levels. Sales in the 7th cycle were restated at $639 million.

The Diwali vacation in India from October 30 means demand for inventory is lower as manufacturers hold on to fewer goods during the period. While cutters have been ramping up production for the holiday, they are now limiting how much rough they buy because they will be shut for much of November.

Rough demand “continued to reflect the improved midstream trading environment compared with 2015,” Bruce Cleaver, De Beers chief executive officer, said. “Our rough diamond sales were slightly ahead of expectation during the cycle, given the normal seasonal demand patterns, the shorter than usual period between sights 7 and 8, and the forthcoming holidays in some of the major diamond cutting centers.”

Prices of stones in the 1 to 2 carat range increased by about 1 to 2 percent, even as smaller star and melee prices declined around 0.5 percent to 1 percent, a sightholder reported. As a result of the price rise, premiums on boxes on the secondary market declined 2 to 5 percent compared with the week before the sight, according to rough brokerage Bluedax.

“Once the sight got underway and the market realized there was a price increase, buying in the secondary market cooled,” Dudu Harari, co-founder of Bluedax, wrote in a blog.

The latest sales figure includes the De Beers sight held in Gaborone, Botswana, from September 26 to 29, as well as auction sales and supply to beneficiation and government partners. De Beers holds 10 sights in a year.
Tags: Bluedax, Bruce Cleaver, De Beers, Diwali, India, Rapaport News, sight, sightholder, Sightholders
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