De Beers Sells $418M Rough Diamonds at Final Sight 2016 - Says India's Cash Ban Hurt Sales

Mining and Exploration
13/12/2016 09:47

De Beers (provisionally) sold $418 million in rough diamonds at its final sight (Cycle 10) of 2016, the smallest sight of the year as the trade winds down for the holidays. This is a 12% decline from the Cycle 9 Sight, but represents a 68.5% rise from the Cycle 10 Sight of 2015. As has become a recurring theme among rough diamond producers in the past 6 weeks, De Beers CEO Bruce Cleaver points to the demonitization policy in India as pushing sales down, particularly among the smaller goods: “We continued to see good demand for De Beers rough diamonds in our latest sales cycle," said Cleaver. "While the trade in lower value rough diamonds is experiencing a temporary slowdown as a result of the demonetisation programme in India, demand across the rest of the product mix continued to be healthy and overall sales remained in line with seasonal expectations. Pleasingly, sales were also significantly higher than those for the equivalent cycle in 2015.”

Bloomberg reports that De Beers allowed select buyers to pass on boxes of the cheaper stones even if they have used up their allowance of deferrals, according to people familiar with the deals who asked not to be identified because the information isn’t public. They report that De Beers has also taken the unusual step of permitting buyers to refuse lower-quality stones from pre-mixed assortments of diamonds, they said.