Sales slid 30% year on year to $36.7 million for the three months ending March 31, the company said last week. Sales volume fell 10% to 25,687 carats, while the average price decreased 22% to $1,431 per carat.

The result reflected an unfavorable comparison with the same period in 2022, when rough demand was strong, driving prices up.

Additionally, the company sold seven diamonds for more than $1 million each during the quarter, contributing $11.1 million to the total revenue. That compares with nine diamonds a year ago, for $16.2 million. A 6.63-carat, pink diamond, which sold for $282,889 per carat, garnered the highest price. Meanwhile, the best price for a white diamond was $34,441 per carat.

However, revenue rose 13% from the fourth quarter of 2022, with sales volume up 14%. The average price was flat.

Production for the period slipped 2.3% to 27,774 carats as the company mined lower-grade ore. During the period, Gem Diamonds recovered a 122-carat, white, type II diamond, which it plans to sell in the second quarter, it added.

Image: The Letšeng diamond mine. (Gem Diamonds)

The post Gem Diamonds Revenue Shrinks Amid Dearth of Large Stones appeared first on Rapaport.

Antwerpsche Diamantkring, Antwerp’s rough diamond exchange, is partnering with the Natural Diamond Council (NDC) to promote natural diamonds.

The exchange is the first diamond bourse to provide financial support to the NDC, the organization mandated to market natural diamonds, the council said last week. The Diamantkring will engage with its members to support the NDC’s campaigns and educational programs. In return, the NDC will promote Antwerpsche Diamantkring’s rough trading platforms.

The NDC, which was established by the major mining companies, is facing a budget shortage after Russian producer Alrosa withdrew its membership when the war in Ukraine broke out. The NDC has made an appeal to the industry to help fill the gap left by Alrosa, which accounted for nearly half of the NDC’s funding.

“The board of directors of the Antwerpsche Diamantkring wants to support the work of the NDC and wishes to encourage other diamond organizations or private diamond companies to follow suit,” said Michel Schonfeld, President of the Antwerpsche Diamantkring.

The NDC’s latest campaign focuses on elevating the story of natural diamonds over lab grown. Titled “Diamond Facts: Addressing myths and misconceptions about the diamond industry,” the program shows how the diamond industry supports the livelihoods of 10 million people globally, and how it compares favorably with lab-grown diamonds in terms of rarity, sustainability and long-term value.

Image: Diamcor shovel with rough diamonds. (Diamcor Mining)

The post Antwerp Diamantkring Backs Natural Diamond Council appeared first on Rapaport.

De Beers enjoyed solid rough demand at its latest sight as the Chinese market gradually reopened, even though the sale yielded less revenue than a year earlier.

The third sight of 2023 brought in $540 million — 4.6% less than the $566 million De Beers saw in the equivalent period last year, the miner reported Wednesday. The total was 9% higher than this year’s second sales cycle, which grossed $497 million.

The latest figure covers the sight that ran from March 27 to 31, as well as auction revenues. The company holds 10 sights a year in Gaborone, Botswana.

“We have continued to see good demand for our rough diamonds over the third sales cycle of the year as we move into the second quarter of 2023,” said De Beers CEO Al Cook. “Sales were in line with expectations, and we continue to see some encouraging positive trends in consumer demand for diamond jewelry — not least in China, where we’re beginning to see some signs of recovery in consumer confidence following the relaxation of travel restrictions.”

The company kept prices mostly stable relative to the previous sight, market sources told Rapaport News. This followed successive price increases for small diamonds at the first two trading sessions of the year.

Image: A 25-carat rough diamond at De Beers’ offices in Calgary, Canada. (Ben Perry/Armoury Films/De Beers)

The post De Beers Upbeat Despite Sales Slowdown at Sight appeared first on Rapaport.

The RapNet Diamond Index (RAPI) for 1-carat diamonds fell 1.6% in March and 2.6% during the first quarter. RAPI for 0.30-carat stones continued to firm, driven by the rebound in China – a strong market for this category. Inventory of 0.30-carat goods has declined due to reduced manufacturing over the past year.

Sentiment improved as the Hong Kong International Jewellery Show signaled a return of Chinese buyers after a prolonged absence due to Covid-19 restrictions. However, those buyers lacked urgency following the initial boost from the fair. The release of pent-up demand has yet to occur.  

Polished inventory remains historically high but has come down in popular sizes. The number of unique diamonds listed on RapNet declined 3% in March to 1.72 million as of April 1. That was still 10% above the pre-pandemic levels of March 1, 2020.

Polished production is stable at lower quantities. India’s rough imports by volume dropped 14% year on year in the first two months of 2023. Manufacturers’ profit margins have tightened since prices for smaller rough increased an estimated 30% in the first quarter.

The diamond supply chain is bifurcating into goods that are fully traceable to responsible sources, and goods that are not. Ahead of a mid-May summit, the G7 nations are working on a plan that would require companies to declare the non-Russian origins of their diamonds. The directive would increase measures to keep any polished that came from Russian rough out of the major G7 consumer markets.

The updated sanctions will likely accelerate the market split and may lead to scarcities of popular items within G7 countries, especially with demand projected to improve in the second half of the year.

Rapaport Media Contacts: media@rapaport.com

US: Sherri Hendricks +1-702-893-9400

International: Avital Engelberg +1-718-521-4976

About the RapNet Diamond Index (RAPI): The RAPI is the average asking price in hundred $/ct. of the 10% best-priced diamonds, for each of the top 25 quality round diamonds (D-H, IF-VS2, GIA-graded, RapSpec-A3 and better) offered for sale on RapNet® (www.rapnet.com). Additional information is available at www.rapaport.com.

About the Rapaport Group: The Rapaport Group is an international network of companies providing added-value services that support the development of ethical, transparent, competitive and efficient diamond and jewelry markets. Established in 1976, the group has more than 20,000 clients in over 120 countries. Group activities include Rapaport Information Services, providing the Rapaport benchmark Price List for diamonds, as well as research, analysis and news; RapNet, the world’s largest diamond trading network; Rapaport Trading and Auction Services, the world’s largest recycler of diamonds, selling over 400,000 carats of diamonds a year; and Rapaport Laboratory Services, providing Rapaport gemological services in India and Israel. Additional information is available at www.rapaport.com

Image: Polished diamond with tweezers. (Shutterstock)

The post Quiet Diamond Market Reflects Economic Caution appeared first on Rapaport.

The Botswana government will acquire a minority share in Belgian manufacturer HB Antwerp, upping the ante in the state’s ongoing negotiations with De Beers.

“Today is the dawn of a new era for the diamond industry in Botswana, as we begin this journey with HB Antwerp,” Botswana President Mokgweetsi Masisi said Monday.

Through the partnership, the African country will buy 24% of HB, which specializes in large diamonds, Masisi added. Okavango Diamond Company (ODC), the state-owned diamond-trading company, will supply rough to HB Botswana for five years.

The parties have agreed on the key commercial terms and expect the signing to take place in the coming weeks, he noted. They did not say what volumes of rough would be involved in the supply arrangement or how the development would impact talks with De Beers. De Beers was unavailable for comment at press time.

The announcement, which took place at the official opening of the HB Botswana factory, follows months of discussions about the future of the country’s relationship with De Beers. Simultaneous negotiations between the government and the miner over both a sales agreement and a mining license have dragged on. The previous supply deal was due to expire at the end of 2020 but saw repeated extensions, leading to speculation that Botswana was unhappy with the current arrangement.

Among the rumors was that ODC might sell a larger chunk of rough coming from the country’s mines. At present, the parastatal company has access to 25% of run-of-mine production from Debswana, a 50:50 joint venture between De Beers and the government.

HB had also been floated as a possible partner. The company already operates a supply deal with Lucara Diamond Corp. — for the Karowe mine’s rough above 10.8 carats — enabling the miner to retain a share of the final polished value.

“Together [with HB,] we have created an entirely new business model for mineral infrastructure, radically upending the narrative on how extractive industries can work with and for countries of origin to bring greater shared economic development and prosperity,” Masisi continued. “Once we decided that it was time to change course, we knew we needed to fundamentally alter our way of working, and find partners who shared this vision.”

HB is also working on a second Botswana cutting facility that will be 15 times the size of the one it’s currently inaugurating, revealed Rafael Papismedov, the Belgian company’s cofounder and managing partner.

“We recognise there is significant interest regarding our negotiations with the government of the Republic of Botswana to agree a long-term mining licence and sales agreement for Debswana,” a De Beers spokesperson told Rapaport News. “At the heart of these negotiations is a discussion on how best to broaden and deepen the unparalleled socioeconomic growth our 54-year partnership has delivered with and for Batswana.”

De Beers is “proud of what we have delivered as a partner to Botswana, and we are excited by our collective potential to ensure even more Batswana can add more value to, and generate more value from, their finite natural resource,” the spokesperson added.

Update, March 28, 2023: A statement from De Beers has been added to this story.

Correction, April 4, 2023: Okavango Diamond Company has access to 25% of Debswana’s run-of-mine production, and not 15%, as stated in an earlier version of this article.

Image: Rough diamonds. (HB Antwerp)

The post Botswana to Buy 24% Stake in HB Antwerp appeared first on Rapaport.

The diamond market has had an eventful 2023 so far: Some of the developments include new Russian sanctions on the horizon, China opening for business, more takeover rumors among the luxury brands, artificial intelligence (AI) making waves and a major delegation of young diamantaires exploring India.  

Editor in Chief Sonia Esther Soltani returns from maternity leave to catch up on the news with Senior Analyst Avi Krawitz and News Editor Joshua Freedman, in this episode of the Rapaport Diamond Podcast. The team highlights the major events, trends and quirky stories that have shaped the diamond industry in the first quarter of the year. 

Listen to the podcast here:

The post Podcast: Sanctions, Hong Kong and AI appeared first on Rapaport.

Petra Diamonds’ rough prices increased at its latest tender as the market benefited from a rebound in China and steady polished demand from high-end jewelers.

The March trading session brought in $72.1 million from the sale of 505,398 carats, with like-for-like prices gaining 12.5% versus December, the miner reported Wednesday. Of the total, $7 million came from one exceptional stone from the Cullinan mine in South Africa.

“We ascribe the positive pricing trends to a recovery in demand from China as Covid-19 restrictions continue to dissipate, coupled with a more buoyant outlook from the recent Hong Kong International Jewellery Show,” said Petra CEO Richard Duffy. “Stronger demand from major jewelry brands has also supported prices for smaller goods. Solid demand for colored stones across all size ranges was evident in this cycle, leading to improved pricing.”

The sales value was 71% higher than December’s $42.3 million but 49% less than the equivalent tender a year earlier, which occurred in February 2022. The sales volume was 31% lower by the latter comparison.

Rough diamonds in the 2- to 5-carat sizes increased 3.5% versus December, Petra added. Overall prices for all categories dropped 12% relative to February 2022, reflecting a spike when the Russia-Ukraine conflict began, management explained.

“We continue to expect a supportive diamond market in the medium- to longer-term as a result of the structural supply deficit,” Duffy said. “Current levels of demand remain robust, though we are cognizant of possible near-term volatility owing to recent geopolitical and macroeconomic uncertainty.”

Image: The Cullinan mine in South Africa. (Petra Diamonds)

The post Petra Rough Prices Rise Amid China Recovery appeared first on Rapaport.

De Beers’ sales fell at its February trading session as sightholders deferred demand to later in the year amid uncertain market conditions.

The second sales cycle of 2023 grossed $495 million, a drop of 24% from last year’s equivalent period, the company reported Wednesday. Sales were, however, 9% higher than January’s $454 million.

“We know that sightholders planned more of their purchases for later in 2023, given the economic uncertainty at the time they were taking their planning decisions at the end of 2022,” said Al Cook, De Beers’ new CEO. “It is also encouraging to see some positive trends in end-client demand for diamond jewelry at the start of the year.”

The total includes the company’s February sight as well as auctions. The company raised prices of its smallest diamonds for the contract sale, but mostly maintained rates for larger stones after January’s price decline, customers told Rapaport News.

De Beers’ rough revenues have fallen 28% year on year to $949 million for the first two sales cycles of 2023, according to Rapaport calculations based on the company’s sight reports.

Image: Rough-diamond sorting. (De Beers)

The post De Beers Sees Further Sales Slowdown appeared first on Rapaport.

Manufacturers are split on whether small diamonds deserved such a sharp increase.

Last week, De Beers did something it hadn’t done since the boom of early 2022: raise rough prices at two consecutive sights.

Customers turned up at this month’s sale to find that the smallest stones cost around 10% more than in January, when the miner already implemented a similar hike.

What’s especially unusual is that the company has zoomed in on a specific segment, namely the minus-7 sieve sizes — weighing around 0.03 carats — that produce tiny melee. In one subcategory, prices have risen around 30% since the start of the year, sources said.

“I don’t think anyone was expecting it,” a rough-market insider said on condition of anonymity.

Many dealers had predicted De Beers would wait to see demand levels at the March Hong Kong shows — which begin this Wednesday — and the speed of China’s recovery before making further tweaks.

The hot market for smalls — in contrast to weakness in most categories — is because the resulting polished is popular among the high-end brands that use melee to make fine jewelry and watches. The rough has also been in short supply in recent months because of a lack of Russian production, while it’s also become a favored choice among manufacturers looking to combat thin profit margins by filling factories with lower-cost rough.

Sights vs. tenders

The change goes some way toward correcting a discrepancy between rough prices on the primary and secondary markets, market insiders explained. Sightholders were getting a relatively good deal on the smalls, since De Beers reacted conservatively to the boom the segment enjoyed in the second half of last year. This enabled them to profit from reselling the rough to other manufacturers. (Not a lot of information is available about the prices Alrosa is charging the contract customers that are still buying its rough.)

“Manufacturers…are buying goods secondhand from sightholders and dealers who are charging them a high double-digit profit,” said an executive at an Indian cutting firm. “If they were to be able to buy [at De Beers’ or Alrosa’s] list price, they would make a killing.”

In a peculiarity of the contract-sale system, prices don’t always correlate with polished demand at the time. Market improvements can prompt De Beers to raise prices, but they can also lead to price reductions after downturns as management attempts to stimulate buying. This happened in August 2020 after the first Covid-19 lockdowns and again last month — in larger categories — when China looked set to emerge from its recent slowdown.

The latest De Beers price increases do not fully match the demand manufacturers are seeing, another sightholder said anonymously. Suppliers in India are witnessing a gradual return of demand for the 0.30-to 0.50-carat goods, as Chinese buyers are slowly returning, but the tiniest smalls are on the opposite trajectory, he claimed.

“I don’t know why they’re targeting [the smallest diamonds] so much,” he said. “If you would ask any Indian, they would say that polished is going down in smalls. So it’s very much against the sentiment.”

Thin margins

The move also comes amid tight profit levels at manufacturers, as rough prices have largely remained high — especially on the open market — despite mixed polished demand.

“We look at profitability in the midstream and the manufacturers, and we’re very much [focused on] how…we play a responsible and sustainable role in the long term,” said De Beers chief financial officer Sarah Kuijlaars.

Stars and melees — the smallest polished items — are in strong demand, observed Vipul Shah, chairman of India’s Gem & Jewellery Export Promotion Council (GJEPC) and CEO of Mumbai-based manufacturer Asian Star. However, “we are struggling as far as the profitability is concerned,” he said in mid-February, ahead of De Beers’ price increase. He noted that the problem was more with the expensive auction and tender goods than with sight supply.

In the second half of last year, prices of rough above 0.75 carats — also known as 3-grainers — plummeted on the open market as Chinese polished demand dried up and US sales were shaky. Small stones held up better.

“We have seen a huge correction in the larger goods in rough diamonds, and all that pressure is coming on the smalls now,” Shah explained. “It’s not making sense if the profitability is not there.”

There’s a fine line between adjusting prices to match the market and making business hard for sightholders. De Beers might have crossed this with the latest hike, one of the manufacturers claimed.

“They were very, very gentle and slow when it came to price increases last year in minus-7 [sieve sizes] and minus-3-grainers,” he acknowledged. “I think they’re just overshooting it now.”

Image: Rough diamonds on display at De Beers’ offices in Calgary, Canada. (Ben Perry/Armoury Films/De Beers)

The post De Beers’ Price Hike Exposes Profitability Concerns appeared first on Rapaport.

De Beers has increased prices of small rough diamonds for the second consecutive sight, as a combination of demand and supply factors has created a hot market for the category.

Prices for tiny stones rose by around 10% on average at this week’s trading session, with sharper advances in certain segments, customers and insiders estimated Monday. The changes were mainly for minus-7 sieve sizes, which weigh about 0.03 carats, across a range of qualities. De Beers declined to comment.

The February sale runs this week from Monday to Friday in Gaborone, Botswana.

Rough under 0.75 carats became a sought-after asset in the second half of 2022 as melee demand from luxury brands strengthened and Indian manufacturers needed cheaper material to fill factories amid thin profit margins. In addition, Western sanctions on Russian diamonds created a mixture of real and perceived shortages in those sizes, for which Alrosa is the biggest supplier. The trade is watching for potential further restrictions as the one-year anniversary of Russia’s invasion of Ukraine approaches.

“Are people preempting what the [new] measures might be on Russia? [The strong market] might have to do with that,” a rough-market participant told Rapaport News on condition of anonymity.

Last year, De Beers made only modest increases in the prices of smalls, even when the segment saw robust demand, a sightholder explained on condition of anonymity. The miner raised prices at last month’s sight by approximately 10% — alongside decreases in the slower, larger goods.

The fresh hikes caught many dealers by surprise, as they were expecting De Beers to monitor the Chinese recovery before making further price adjustments.

Image: Small rough diamonds. (Shutterstock)

The post De Beers Lifts Prices of Its Smallest Rough Diamonds appeared first on Rapaport.