Bloomberg News

De Beers Optimistic About Diamond Demand During Holiday Season

October 19, 2012

De Beers, the world’s biggest diamond producer by value, said it is positive about demand for the gems ahead of the key holiday sales period.

“We’re cautiously optimistic about it based on the feedback we’ve had,” Stephen Lussier, executive director at the unit of London-based Anglo American Plc, said in a phone interview today. “It’s not going to a booming year like we saw in 2010 and 2011, but it does look to be decent given the environment we’re in.”

Rough diamond prices have fallen for four straight months and have slumped 15 percent this year as Asian purchases slowed and the euro region debt crisis eroded demand, according to data compiled by WWW International Diamond Consultants Ltd. Prices have risen by more than 20 percent in each of the past three years as producers struggled to keep pace with consumption.

Growth in global diamond demand may slow this year to about 3 percent to 5 percent from a record 10 percent in 2011, De Beers (AAL) said in August. Chinese demand growth may slow to 5 percent to 10 percent. Thanksgiving and Christmas sales, along with the Diwali festival in India and and the Chinese New Year are the most important sales periods for diamond retailers.

“Between now and February is the key period,” said Lussier, who is also chief executive officer of Forevermark, De Beers’ diamond brand. “As long as the season is ok we’ll probably see prices starting to trend up next year.”

Anglo American bought the Oppenheimer family’s 40 percent of De Beers for $5.1 billion this year, increasing its stake to 85 percent. Botswana owns the rest of the business.

To contact the reporter on this story: Thomas Biesheuvel in London at tbiesheuvel@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net


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