De Beers Had Biggest Diamond Sale This Year in August, RBC Says

By Carli Lourens

Sept. 2 (Bloomberg) -- De Beers, the world’s largest diamond supplier, held its biggest sale so far this year in August as gem prices improved, RBC Capital Markets said, citing cutters and polishers it didn’t identify.

De Beers probably sold diamonds worth as much as $475 million at its seventh sale, analyst Des Kilalea said in a note to clients dated yesterday. That brings sales at the Diamond Trading Co., De Beers’ trading arm, to about $2.2 billion this year, the lowest “in more than 20 years,” he wrote.

De Beers spokeswoman Lynette Gould couldn’t immediately comment when Bloomberg News contacted her by phone in London. DTC is the world’s largest rough gem distributor, selling about 40 percent of all uncut diamonds.

De Beers expects demand to improve in the second half, it said on July 24. The company, which is 45 percent-owned by Anglo American Plc, slashed output as first half sales dropped 57 percent to $1.4 billion, it said.

Recession cut demand in the U.S., which accounts for about half of global diamond retail sales. Prices have increased about 6.8 percent during the past three months, according to an index compiled by market researcher Polished Prices.

“Resilient” prices could “reflect the need of the cutting and polishing factories to ensure they have sufficient stock for the Indian festival of Diwali and the important Christmas season in the world’s largest market, the U.S.,” Kilalea said in the note.

RBC is forecasting DTC’s sales at $2.8 billion to $3 billion this year.

To contact the reporters on this story: Carli Lourens in Johannesburg at clourens@bloomberg.net