Source estimated that De Beers’ diamond prices have fallen at least 20 percent over the last year and a half
After a dismal 2015, the diamond market may be coming back to life, with De Beers raking up twice as many sales in January as at the prior sight.
The company announced that sales at the first sight of the year totaled $540 million, more than double December’s $248 million sight. It cited a “positive holiday in the U.S.,” as well as generally low polished stocks, as reasons for the strong sale.
This marks the first time De Beers has publicly announced the value of a sight.
CEO Philippe Mellier said he was “encouraged” by the sale and will “keep working closely with our customers to deliver sustainable improvements in the diamond industry in 2016.”
Sources say that the allocations were attractively priced and clients felt they had no choice but to buy. Some estimated that De Beers’ diamond prices have fallen at least 20 percent over the last year and a half.
Kieron Hodgson, commodities and metals analyst for Panmure Gordon & Co., was among those seeing encouraging signs.
“Polished prices continue to improve as shortages for certain goods rise,” he wrote. “As supply continues to tighten through the efforts of the major producers, profits are starting to reappear… How many major commodities have taken out over 25% of global supply in 3 months?”
In its recent market update, miner Petra Diamonds also expected the industry to stabilize in the first half of the year, and the market to improve in the second.