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De Beers Sees Rise in Diamond Prices

Posted on: Tuesday, 12 July 2005, 09:01 CDT

De Beers sees rise in diamond prices

JOHANNESBURG, July 11 (Xinhua) -- De Beers, the world's biggest diamond producer, expects the increase of diamond prices in the year ahead and more earnings at its South African unit thanks to growing demand for gems and a more stable dollar than last year, a local report said on Monday.

According to local daily Business Day, De Beers reports results for the half-year to June on July 25 and parent Anglo American on August 4.

Jonathan Oppenheimer, MD of the South African unit, De Beers Consolidated Mines, said last week that last year was a record year for consumer growth but that profit was curbed by a weaker dollar.

"We have been encouraged by the way global demand for diamonds has progressed, and believe we will see small increases in price," he said. "We expect rough-diamond prices to be flat to slightly increasing this year .. when those rises will come is difficult to predict."

According to Anglo American's latest annual report, retail diamond sales passed the 60 billion US dollars mark for the first time last year.

De Beers, 45 percent owned by Anglo American, is aiming to grow global demand for diamond jewelry by 50 percent in the next 10 years. It spends 180 million dollars a year on advertising and marketing, which has been significantly bolstered by campaigns by sightholders and their downstream trade partners.

De Beers' marketing arm, the Diamond Trading Company, grew prices 14 percent last year. This year, it has increased average prices 3 percent in January and 3 percent last month.

Oppenheimer said De Beers was trying to improve the productivity of its employees and mines.

He said in May that De Beers' South African unit expected to increase production to more than 14-million carats this year from 13.7-million last year, and first-quarter production was ahead of forecasts.

Source: Xinhua News Agency - CEIS

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