De Beers

[Donald Duck]

De Beers says first-half sales up 10%
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De Beers, the biggest diamond producer globally, on Wednesday reported a 10% increase in sales for the first half of the year, as prices rose, despite a slight reduction in production.

MD Gareth Penny said that it would be "imprudent" not to be cautious over sales for the second half of 2008, given the current economic climate, but that demand for high-end stones would likely remain robust.

"Overall demand for rough diamonds continues to be strong," he told reporters on a conference call from London.

For the six-months ended June 30, De Beers reported total sales of $3,74-billion, compared with the same period the previous year's figure of $3,4-billion. Underlying earnings rose 8% period-on-period to $350-million.

There were two principal reasons that South African production showed a small decrease, Penny said, naming the power crisis at the beginning of the year, as well as De Beers having disposed some of its marginal mines.

Group production for 2008 would be 50-million carats, which was largely in line with the previous year's figure, he stated.

"Mass market retail diamond jewellery sales have been impacted by economic issues in the most important market, the US. While strong growth in China, India, Russia and the Middle East has helped to mitigate the US slowdown, the overall retail market is likely to remain challenging," De Beers said in an emailed statement.

Diversified-miner Anglo American owns 45% of De Beers, the Botswana government 15%, and the Oppenheimer family has a 40% holding.
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De Beers to open record three new diamond mines this year
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World number-one diamond producer De Beers will open three new mines in 2008, which is a record for the 120-year-old company, chairperson Nicky Oppenheimer said on Wednesday.

These new operations included the Snap Lake and Victor mines in Canada, and Voorspoed in South Africa.

"Diamond mines are very hard to find, and, when you look at the number of diamond mines in the world, they are very few and far between," Oppenheimer stated.

Meanwhile, De Beers MD Gareth Penny said that the company had done well in building its most recent mines.

"We are very proud of what we've achieved in our most recent projects, in terms of on time, on budget," he said on a conference call from London.

"What is particularly exciting for me, is the fact that, during this year, we will be opening three new diamond mines, which is certainly a record for De Beers," stated Oppenheimer.

He noted that the company would formally open Snap Lake and Victor during the last week of July, with Voorspoed's formal opening would occur towards the end of the year.

Penny said that the Victor mine would produce "very high-quality" stones that were "highly sought after", while Snap Lake's diamonds were also attractive, and above the group's average value.

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Gem sales to remain strongest over Christmas season for now – De Beers
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While the last three months of the year would continue to show the strongest diamond sales, on demand from the US and the Middle East, sales might show a more balanced spread over the rest of the year as demand grew in other countries, De Beers MD Gareth Penny confirmed on Wednesday.

This came as growing demand from emerging markets helped to mitigate the economic slowdown in the US, the market that bought about half of the gems that De Beers produced.

"One of the major seasons for example, in China, happens earlier in the New Year, rather than at the end of the previous year, as would happen, for example, in the Christmas season in the US," Penny said on a conference call.

"So, perhaps the year is going to be more balanced, if you like, in terms of consumer demand, as these new centres become more and more important."

China celebrates its New Year in February, when gifts are exchanged.

However, he noted that the period from October to December would not soon get unseated as the best time for diamond sales.

"Having said that, the major season for diamond jewellery is going to continue to remain in the fourth quarter," stated Penny. "It is the period when Middle East sales are very strong and obviously the US sales are very strong."

"So, for the time being, it will certainly remain the dominant period in the year," he added.

De Beers, which increased its sales for the six months to June 30 by 10%, said that demand for high-end diamonds would likely remain robust, but that it expected the market for smaller stones to remain subdued.

SUPPLY & DEMAND

Meanwhile, the world's biggest diamond producer said that the diamond-supply deficit was starting to show in gem prices.

"We've been talking for quite a long time about the supply and demand gap, and I think you're starting to see that coming through now, because demand, particularly at the higher end, continues, and supply through last year, and, indeed, through the first half of this year has, in aggregate, declined," Penny said.

"So that is creating the positive momentum that you're seeing."

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[SandyB]

So its not all bad  ?? .. scarcer commodity .. higher price ??  or what  ??

[Donald Duck]

I don't know - I just chuck things into the pond........

[Michael Alexander]

... and what a sparkling pond it is!  party0024

[Donald Duck]

Easier for the fish to see the bait - and hope they bite.....