De Beers Sees Diamond Price Steadying

Published on 20/12/11

De Beers, supplier of about a third of the world’s rough diamonds, said prices of the gems may “stick” at current levels after demand from India and China spurred a rally of more than 35 percent this year.
Rising wealth in the two countries is enabling consumers to buy more diamond jewelry, compensating for slower growth in the U.S., the biggest retail-gem market. Demand from East Asia has caused a supply shortage, which pushed up prices this year, Chief Executive Officer Philippe Mellier said in an interview.
“We’re now reaching a new plateau from which prices are going to oscillate,” Mellier, 56, said by phone yesterday. “I am expecting this new level of pricing to stick.”
Rough-diamond prices advanced 49 percent in the first half, accelerating after two straight years of more than 30 percent growth as stagnant output failed to meet Asian demand, according to data from PolishedPrices.com. De Beers was among producers caught on the back foot after idling mines as the global economic crisis eroded gem sales.