De Beers set to unveil sparkling sales for 2005

JOHANNESBURG – The world’s top diamond producer De Beers’ rough diamond sales are expected to have jumped 15 per cent to US$6,5 billion for 2005 on demand from China, India the Middle East and a recovery of sales in Japan.

A Reuters survey of five analysts also showed De Beers’ contribution to earnings of mining giant Anglo American, which holds 45 per cent of the diamond group, would have risen 15,4 per cent to US$440 million, based on the average forecast. De Beers raised its rough diamond prices in January and June last year, by three per cent each time, which would have helped its sales, they said.The survey’s forecasts for sales by De Beers’ London-based Diamond Trading Co ranged between US$6,3 billion-US$6,7 billion, while those for the contribution to Anglo earnings ranged from US$403 million-US$500 million for 2005.De Beers, which controls over half the world’s diamond supply, has said it will release sales figures tomorrow.But the analysts warned that 2006 would see De Beers’ sales growing at a slower pace compared to 2005, mainly because the US market, which accounts for the lion’s share of the group’s precious gems, was slowing.”De Beers has seen a strong market, price increases and these have largely contributed to what I expect will be a solid performance (in 2005),” an analyst in Cape Town said.”I expect to see growth year-on-year, but not anywhere near 15 per cent (in 2006).”The company said last April that US consumers would drive demand higher, but this market was seen to be cooling off as US interest rates keep ticking higher.”Prices have been stable since June 2005, even in the US even when the prices of other precious metals were rising,” a second analyst, based in Johannesburg, said.”Demand (for diamonds) had started to weaken in the US, so there were no further price hikes.I expect China, the Middle East and a recovering Japan market to help sales remain stable this year, but growth to be more muted than last year.”De Beers increased January-June 2005 sales by eight per cent to US$3,2 billion on the back of higher prices and ramped-up production, and De Beers had forecast a rosy 2005.The group said in July it planned to cut stockpiles, and would therefore not raise prices.South Africa’s Oppenheimer family also has a 45 per cent stake in De Beers and the government of Botswana, the world’s top diamond producer by value, owns the remaining 10 per cent.Analysts said they were also keen to hear news of De Beers’ new projects and 2006 production forecasts.- Nampa-ReutersDe Beers raised its rough diamond prices in January and June last year, by three per cent each time, which would have helped its sales, they said.The survey’s forecasts for sales by De Beers’ London-based Diamond Trading Co ranged between US$6,3 billion-US$6,7 billion, while those for the contribution to Anglo earnings ranged from US$403 million-US$500 million for 2005.De Beers, which controls over half the world’s diamond supply, has said it will release sales figures tomorrow.But the analysts warned that 2006 would see De Beers’ sales growing at a slower pace compared to 2005, mainly because the US market, which accounts for the lion’s share of the group’s precious gems, was slowing.”De Beers has seen a strong market, price increases and these have largely contributed to what I expect will be a solid performance (in 2005),” an analyst in Cape Town said.”I expect to see growth year-on-year, but not anywhere near 15 per cent (in 2006).”The company said last April that US consumers would drive demand higher, but this market was seen to be cooling off as US interest rates keep ticking higher.”Prices have been stable since June 2005, even in the US even when the prices of other precious metals were rising,” a second analyst, based in Johannesburg, said.”Demand (for diamonds) had started to weaken in the US, so there were no further price hikes.I expect China, the Middle East and a recovering Japan market to help sales remain stable this year, but growth to be more muted than last year.”De Beers increased January-June 2005 sales by eight per cent to US$3,2 billion on the back of higher prices and ramped-up production, and De Beers had forecast a rosy 2005.The group said in July it planned to cut stockpiles, and would therefore not raise prices.South Africa’s Oppenheimer family also has a 45 per cent stake in De Beers and the government of Botswana, the world’s top diamond producer by value, owns the remaining 10 per cent.Analysts said they were also keen to hear news of De Beers’ new projects and 2006 production forecasts.- Nampa-Reuters