De Beers Rough Sales Stabilize

RAPAPORT... De Beers brought in $440 million at its March rough sale, with the miner giving an optimistic outlook for the sector while cautioning about the pandemic's continued effects."Following a good holiday season and that trend continuing during the first quarter of 2021, we have again seen solid demand for rough diamonds as we begin a traditionally quieter period of the year for the diamond industry," De Beers CEO Bruce Cleaver said Wednesday. "Sales were in line with expectations, and both market sentiment and overall industry conditions remain positive."The figure for March - encompassing the third sight of the year, as well as auctions - compares with zero sales for the equivalent period in 2020, when De Beers canceled its trading session because of the coronavirus. However, proceeds were the lowest this year following sales of $663 million in January and $550 million in February.De Beers kept rough prices stable after increasing them in January and February, sightholders told Rapaport News. Customers bought all the goods the miner offered, the sources added.The sale was the last under the current supply contract, with a new arrangement set to go into effect from the next sight, which will run from May 3 to 7. The new system divides sightholders into three groups - manufacturers, dealers and retailers - and provides each type with more bespoke goods.De Beers informed sightholders of their new rough-diamond allocations last month. More diamonds will go to companies with developed marketing functions or with polishing factories in Africa, insiders said.The rough market ground to a halt in the second quarter of 2020 as the coronavirus shut manufacturing units in India and disrupted international shipments. It recovered in the second half amid a release of pent-up demand ahead of the holidays and the emergence of polished shortages. De Beers and rival Alrosa both saw sharp sales jumps at the start of 2021 when customers replenished stocks.But fresh virus waves have threatened to derail the recovery, with Mumbai's Bharat Diamond Bourse (BDB) closing this week until further notice because of a regional lockdown. European countries including France and Italy also imposed tight restrictions during the Easter period."With pandemic developments in Europe and Mumbai's recent lockdown resulting in the Bharat Diamond Bourse being closed, it is clear that we will continue to see challenges relating to Covid-19," Cleaver added.Image: Rough diamond at De Beers' offices in Calgary, Canada. (Ben Perry/Armoury Films/De Beers)