De Beers expands diamond sales

Rough diamonds and diamond sorting  or grading at the Harry Oppenheimer House in Kimberley, South Africa.
Rough diamonds and diamond sorting or grading at the Harry Oppenheimer House in Kimberley, South Africa.
Vismedia

London - De Beers increased diamond sales at its third offering this year in a sign of recovering demand for rough gems after a slump last year. Shares of listed parent Anglo American [JSE:AGL] surged as much as 9.4%.

De Beers sold $660m of diamonds in April, the diamond miner said in a statement on Tuesday. That’s up from the $617m of the previous sale and $545m in January.

"So far, 2016 has seen significantly stronger rough diamond demand than that experienced at the end of 2015," chief executive officer Philippe Mellier said.

"However, we are now moving into a part of the year where rough diamond demand has historically been lower as a result of seasonality, so we continue to adopt a prudent mind-set."

De Beers raised prices as much as 2% in the sale, said people familiar with the process, the first increase since the end of 2014. Last year, slowing Chinese demand and an industry credit crunch forced the company to cut prices about 15%. De Beers and rival Alrosa PJSC responded by cutting off supply to try to support the market.

"An encouraging result," Investec said in a note. "We wait to see how the market progresses as seasonal demand wanes and hope that major deferrals are not a feature as they were last year nor is there a need to cut prices."

Anglo shares rose 5.8% to 619.2 pence in London trading after earlier rising to the highest since October 19.

De Beers, which doesn’t reveal details of its sales, offers diamonds at 10 sales a year known as sights.

ZAR/USD
17.20
(-0.08)
ZAR/GBP
22.49
(-0.04)
ZAR/EUR
20.24
(-0.11)
ZAR/AUD
12.26
(-0.24)
ZAR/JPY
0.16
(+0.03)
Gold
1970.97
(-0.19)
Silver
24.17
(-0.15)
Platinum
918.00
(+0.08)
Brent Crude
43.86
(+1.45)
Palladium
2097.16
(+0.69)
All Share
56265.86
(+0.78)
Top 40
51978.06
(+0.79)
Financial 15
9884.60
(+0.81)
Industrial 25
75164.56
(+0.57)
Resource 10
57182.28
(+1.06)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 830 votes
It depends on how the funds are used.
74% - 5486 votes
No. We should have gotten the loan elsewhere.
15% - 1097 votes
Vote