De Beers Looking For Steady Not Spectacular Recovery

Finance and Trade
22/02/2016 08:57

De Beers will carry on limiting supply to the market in a bid to help the industry recover from weak demand. “We’re very mindful of not pushing it too far,” Gareth Mostyn, head of strategy at De Beers, told Bloomberg. “We would much prefer a steady, sustainable recovery rather than any spectacular takeoff.” Miners slashed about a quarter of global supply last year in an attempt to stem an 18% fall in rough diamond prices due to an economic slowdown in China and a credit crunch.

Mostyn commented that initial feedback for holiday sales in the United States had been positive. “We’re selling what our customers want and need rather than doing anything that might not be in ours or the industry’s best interests,” Mostyn said. “The key for us is to continue to build on improving confidence through 2016.” De Beers' profit contribution to parent company Anglo American almost halved last year, with underlying earnings falling to $990 million, while sales dropped 34 percent to $4.67 billion as prices fell and it cut production and sales.