Liberum's central forecast is for the global composite price to rise to US$182/ct in 2021, rising 2% per year thereafter, miningnews.net writes.
The UK investment bank said it expected post-lockdown mined supply to fall 5% year-on-year in 2021, "reflecting ongoing constraints on production capacity in Canada, together with mine closures".
The build-up in rough diamond inventory by major producers Alrosa and De Beers in 2020 had cleared by the end of the March quarter, Liberum said, while healthy restocking demand coupled with a weak production growth rate from the majors.
"Our new diamond model expects deficits in the years ahead," Liberum said.
"We forecast subdued mine production growth over the medium- to long-term, underperforming global sales. This results in a persistent draw on producers' inventories, underpinning a sustained recovery in prices across all grades," said the bank.
Alex Shishlo for Rough&Polished
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