De Beers sees negative demand growth in 2022

De Beers has announced that it saw a negative demand growth in 2022 as a result of increased Covid restrictions in China from Q2 onwards.

A weaker economic outlook in the second half of the year caused a build-up of midstream polished diamond inventories, pushing down prices and causing negative growth.

Despite this the company’s total revenue increased to $6.6bn (£5.5bn) compared with $5.6bn (£4.7bn) in 2021, and rough diamond sales rose to $6bn (£5bn)from $4.9bn (£4.1bn).

Rough diamond sales volumes totalled 30.4 million carats down from 33.4 million carats in 2021 and the average realised price rose by 35% to $197/ct (£164) compared with $146/ct (£121).

In terms of mining rough diamond production increased by 7% to 34.6 million carats, up from 32.3 million carats to keep up with the strong demand in the first half of the year.

This was supplemented in Botswana where production increased by 8% to 24.1 million carats.

According to the company the holiday season in 2022 was strong with diamond jewellery sales staying above pre-pandemic levels.

De Beers said in a statement: “Continued softening in global macro-economic conditions could see a contraction in consumer spending and demand for diamond jewellery, which may result in lower demand for rough diamonds in the near term.

“This may be partly mitigated by an increase in demand for diamond jewellery in China, following the removal of Covid-19 restrictions in late 2022. De Beers continues to invest in its leading ability to provide source assurance for its diamonds at scale, underpinned by the Tracr™ blockchain platform.”

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