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De Beers Sees Diamond Demand Accelerating on U.S., China Sales - Businessweek

Rough diamonds-2Global diamond demand is set to accelerate this year, increasing by as much as 4.5 percent as Chinese and U.S. consumers buy more of the precious stones, according to De Beers, the biggest producer.

“Growth should be sustainable mainly because of the U.S. and China,” Chief Executive Officer Philippe Mellier said today in an interview with Francine Lacqua on Bloomberg Television’s “The Pulse.” Diamond consumption will climb by 4 percent to 4.5 percent, compared with about 3 percent in 2013, he said.

De Beers is betting that increased sales in the world’s two largest markets will counter weakness in India, where volatility in the rupee has reduced consumers’ buying power. De Beers, owned by Anglo American Plc (AAL), today reported a 12 percent increase in annual diamond production to 31.2 million carats.

Mellier said it was “too early” to say whether De Beers planned to increase rough diamond prices this year. The company will study demand before making a decision.

De Beers has been more aggressive in diamond pricing by cutting the discount between its selling prices and the secondary cash market since it broke with tradition in 2011 and appointed Mellier, a company outsider, as CEO.

Rough-diamond prices gained 10 percent last year as the U.S. economy recovered and Chinese shoppers bought more of the stones. Prices have more than doubled in the past five years, according to data compiled by WWW International Diamond Consultants Ltd.

via www.businessweek.com

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