JOHANNESBURG – Diversified mining conglomerate Anglo American took a beating on the JSE on Thursday as its diamond producing subsidiary De Beers said that its eighth sales cycle of 2019 slid further into the red, despite concessions made to buyers to either delay or decline purchases of stock already in their hands.
De Beers said the latest sales value of $295 million (R4.51 billion) of rough diamonds sold to selected buyers in Botswana last month was the lowest by far since it began releasing sales data in 2016.
Chief executive Bruce Cleaver said the miner was struggling to maintain diamond sales growth in the face of subdued economic conditions, a slowdown in China, protests in Hong Kong have weakened diamond demand along with a considerable slowdown in sales ahead of the upcoming Diwali festival in India this month
“As we approach what is traditionally a quieter time of year for the diamond industry during the Diwali holiday, we have again offered our customers flexibility during this sales cycle,” Cleaver said.
The company has decided to let buyers reject stones. This will help reduce the oversupply in the market, which should eventually allow prices to recover, but that still does not help current sales figures.