De Beers believes that customers should not be discouraged from purchasing rough diamonds, despite the trying times the industry is going through. “We mine a valuable, finite and depleting resource,” De Beers chief executive Bruce Cleaver noted in an opinion piece.
“We will only sell it when the demand is such that it can create sustainable value for all of us. However, just as we are not compelling our clients to purchase, we strongly believe it is counterproductive for any part of the industry to compel them not to purchase.”
This follows the recent advise by the Gem & Jewellery Export Promotion Council (GJEPC) and other Indian trade bodies for the Asian country’s diamond sector to halt rough diamond imports for 30 days starting mid-May.
Cleaver wrote that while the economic impacts of the pandemic will be different in the main consumer markets, the encouraging signals coming out of China point to the beginnings of a recovery.
“Consumer demand has started to return in the country as the lockdown has eased. People are visiting shops and malls and re-engaging with the world,” he noted.
“While it is too early to draw conclusions, pent-up demand from delayed weddings compressed into a single season, and self-purchases to reward hardships overcome, are showing signs of lifting the Chinese diamond market out of its months-long hibernation.”
De Beers has already significantly reduced the flow of diamonds downstream as most of its mines suspended production to prepare for the coronavirus and are now operating or preparing to operate at far lower levels than normal.
The group also cancelled Sight 3, provided its Sightholders with 100% flexibility to defer their purchases.
It has also cut its production forecast this year by seven million carats than initially planned.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
