De Beers Reduces Prices of Smaller Rough

RAPAPORT... De Beers lowered prices of rough diamonds below 1 carat as the positive sales momentum that began last month continued during this week's sight, sightholders told Rapaport News.The reductions for the September sight are between 5% and 10%, and follow the miner's August price cut for rough above 1 carat.De Beers and rival Alrosa had maintained prices throughout most of the pandemic to avoid flooding the market and devaluing inventories. This deterred many customers from buying, as they perceived the prices to be too high relative to polished prices, which had slumped during the crisis. Both companies finally reduced prices last month as polished demand had picked up ahead of the holidays and shortages emerged after months of low manufacturing activity. "The prices had to be readjusted, because polished prices have fallen and rough prices did not fall," a sightholder said Wednesday on condition of anonymity. "Now they've recalibrated the price according to today's market environment. It shouldn't affect polished prices much, but it [puts] profitability back in the rough."De Beers' sales value at this week's sight will be similar to last month's, when the company brought in $320 million, rough-market sources predicted. Sentiment has risen and Indian manufacturers are seeking goods to polish ahead of the November Diwali festival, which is usually a period of shutdown for the sector."[Manufacturers] have reduced their polished inventory and want to increase the prices of their polished inventory," another sightholder said. "They have liquidity because of the lower inventory and production in the last few months. So people are quite [keen] to manufacture. Hopefully the momentum will go on for a few months."Image: Rough-diamond sorting. (De Beers)