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Bloomberg reported on Monday that according to three people familiar with the situation, De Beers has lowered its prices “after production cuts failed to support [diamond] demand.”
Bloomberg reported on Monday that according to three people familiar with the situation, De Beers has lowered its prices “after production cuts failed to support [diamond] demand.”
Interestingly, the next day De Beers announced plans to “make a major investment in a holiday marketing campaign to generate increased consumer demand for diamond jewellery during the year-end holiday season.” The company plans to target the US and China in particular.
Bloomberg states:
The Anglo American Plc unit reduced prices as much as 9 percent, according to the people, who asked not to be identified as the information isn’t public. De Beers plans to offer about $250 million of diamonds for sale. Customers may buy more after the price cuts, the people said.
The company has already agreed to allow its customers, known as sightholders, to defer pre-agreed purchases at the August sale this week in Botswana, the biggest diamond producing country. A spokesman for De Beers declined to comment.
De Beers and other diamond producers are under pressure to cut supply and lower prices as traders, cutters and polishers struggle to turn a profit amid a squeeze on credit and languishing jewelry sales. De Beers had sought to support the diamond market by reducing production rather than prices.