Sale of roughs falls 25 per cent in January in Surat

SURAT: The New Year has begun on a worrisome note for the famed diamond industry of Surat.

The polished diamond prices, especially in the low-quality goods have declined in the range of 20-25% in the last one year. This has cast a dark shadow on Surat’s diamond industry, where majority of the small diamond units are into the cutting and polishing of lower-value goods.

De Beers stated that the value of roughs at the first cycle of the current year was significantly lower than a year earlier. In January, De Beers sold $505 million worth of rough diamonds as compared to $672 million in January 2018. Bruce Cleaver, CEO, De Beers Group, said “Rough diamond sales during the first sales cycle of 2019 were lower than those for the equivalent period last year, reflecting higher than normal sales in the previous cycle (cycle 10 2018) and the slow movement of lower value rough diamonds through the pipeline.”

India’s rough diamond import between April-December 2018 has fallen 15% at $12 billion compared to $14 billion during same period in previous year. The biggest fall came in December 2018 at 20%. “Sightholders (clients) have to forcefully buy the goods which they don’t want or can’t afford just to avoid losing their sight with the big mining companies like Alrosa and De Beers and financing from the banks,” said a De Beers sightholder asking anonymity.

Diamond industry analyst, Aniruddha Lidbide said, “The reduction of 25% is huge for De Beers and the industry. In better times, sightholders would have sold the diamond boxes in the secondary market, albeit with long credit lines. . These days, fewer sellers are using this option as a means of recouping some of their costs due to fears of bankruptcy. To put it bluntly, the market is facing big changes.”

Six big diamond and jewellery companies including Winsome Diamonds and Jewellery, Forever Precious Jewellery and Diamonds, Kohinoor Diamonds, JR Diamond, Interjewels Private Ltd and Ankur Diamonds have gone bankrupt in the last one year. At least two dozen smaller diamond firms in India had also ceased operations in the last one year.