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De Beers sees robust sales cycle as demand for diamonds sparkles in festive season

De Beers saw the continuation of robust rough diamond demand in the first sales cycle of the year as buyers focus on restocking depleted inventories. Photo: Reuters.

De Beers saw the continuation of robust rough diamond demand in the first sales cycle of the year as buyers focus on restocking depleted inventories. Photo: Reuters.

Published Feb 3, 2022

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DE BEERS, a unit of Anglo American, recorded a robust sales cycle as consumer demand for diamond jewellery increased during the festive season.

Anglo American owns 85 percent in De Beers and holds 10 sales meetings with selected buyers annually, referred to as cycles.

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The sales for the first cycle amounted to $663 million (R10.14 billion) and were higher than the $336m of diamonds sold during the 10th and final sales cycle of last year.

“Owing to the restrictions on the movement of people and products in various jurisdictions around the globe, De Beers Group has continued to implement a more flexible approach to rough diamond sales during the first sales cycle of 2022, with the Sight event extended beyond its normal week-long duration.

“As a result, the provisional rough diamond sales figure quoted for cycle 1 represents the expected sales value for the period January 17 to February 1 and remains subject to adjustment based on final completed sales,” the group said.

De Beers Group chief executive Bruce Cleaver said: “As anticipated, there was strong growth in consumer demand for diamond jewellery over the end of the year holiday season. As a result, we saw the continuation of robust rough diamond demand in the first sales cycle of the year as buyers focus on restocking depleted inventories.”

Diamond demand seems to be recovering from a year ago when it plunged owing to Covid-19 pandemic travel restrictions.

Consumer demand for diamonds has picked up driven by the strong Chinese and US markets against limited supply due to quarantine restrictions in India. De Beers also increased the diamond price by 8 percent in its first sale of the year due to the high demand for uncut precious stones.

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In Botswana and Namibia, De Beers was boosted by stronger performance, giving a 15 percent solidifying in diamond output for the quarter. This reflected the company’s “planned higher production in response to strong” consumer demand. The company expects to produce between 30 million and 33 million carats of diamonds this year.

Last month, Anglo American reported a drop in rough diamond sales from De Beers ahead of the Christmas break for southern African polishing factories.

De Beers, the world’s biggest diamond producer by volume, announced in December that it would return to Angola after a 10-year absence to prospect for diamonds. At the time, Cleaver said Angola had made significant progress towards creating a stable and more predictable investment environment in which the people of Angola could benefit directly from increased foreign direct investment.

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