De Beers lowers its diamond production forecast for 2019

Surat: Slowdown in Indian diamond industry has prompted world’s largest diamond mining company, De Beers to lower its production forecast for 2019, with its mining output in the second quarter falling 14%.
According to the US-based Rapaport Group, the mining output of De Beers fell 14% to 7.7 million carats in the second quarter as the company continues to produce to market demand.
Sales volume slumped 10% to 9 million carats in three months ending June 30 due to oversupply of goods. Demand for rough diamonds remains subdued as a result of challenges in the midstream with higher polished inventories, and caution due to macroeconomic uncertainty, including the US-China trade tensions, the company explained.
According to data published by Gems and Jewellery Export Promotion Council (GJEPC), import of rough diamonds fell 26% in April-June 2019 to $3.4 billion compared to $4.5 billion during the same period last year. Import of rough diamonds in June fell 36% to $969 million compared to $1.5 billion in the same month in previous year.
Industry sources said rough diamond imports are likely to remain on lower side in the next two months following subdued demand for polished diamonds in international market.
Surat Diamond Association president Babu Gujarati said, “The diamond industry is in recessionary mode. Diamantaires are exercising production cut as huge amount of polished diamonds are still lying unsold in their inventories. About 30% of units in the industry are yet to reopen after summer vacation.”
Diamond exporter Kirti Shah said, “Lowering rough diamond production is not going to solve the purpose. De Beers needs to seriously think of drastically lowering prices of rough diamonds. Small and medium units have lost profitability in business.”