As anticipated, De Beers first rough diamond sight of 2020 bounced back to historical levels, earning $545 million (provisional result) at their January sale. The January sale is typically one of the largest of the year as the industry replenishes their stocks following the holiday season and the 2020 iteration did not disappoint.
The first Cycle of 2020 marks the largest sale since April last year - Cycle 3 2019 - and outpaced the Januiary sight of 2019, which earned $500 million, as well as the final sight of 2019, which earned $426 million. Bruce Cleaver, CEO, De Beers Group, said: "Demand for rough diamonds increased during the first Sight of 2020 following the end of year selling season and subsequent inventory restocking." After about a half year of stagnation in the rough diamond market which prrompted the large mining companies to cut supply as well as prices, this sight could well be confirmation of earlier signs of recovery in the rough demand market. It has also been noted that there has been a return of premiums for some goods in the secondary market.
As David Harari, a trader at BlueDax commented, "Although buyers say prices are still too high, the shortage of rough in the factories and the drop in stock level of some polished items means they are once again making purchases in the rough market." He notes that demand for larger rough (5-10 carats) has bounced back, as has demand for the 2-4 carat category and 1-2 carat category.However, premiums (the price above purchase price that sightholders earn from selling onto the secondary market) remain low, except for smaller, cheaper goods, which are in demand.