Global rough diamond market recovers – Petra
LONDON, January 16, 2010 – The global rough diamond market recovered significantly in the second half of 2009, as shown by a rise in prices, and is likely to be in a much stronger position in 2010, Petra Diamonds said.
Indian and Chinese consumer markets continued to expand and helped to take up the slack caused by weaker U.S. and European markets.
However, analysts reported a rise in pre-Christmas sales of jewellery in the U.S., still the largest and most influential jewellery market in the world, as well as a rise in U.S. consumer confidence, boding well for the rough diamond market in 2010, Petra said.
“We have seen prices come back strongly at each of our six producing mines,” Johan Dippenaar, Petra’s chief executive officer, said in a statement.
“Having recapitalised the business and consolidated the Cullinan holding (in South Africa) in December, Petra is on a strong platform as we continue to grow annual production to over three million carats and increase our stature as a significant diamond producer.”
Confidence has returned to the rough diamond market, with financing now beginning to open again to the pipeline.
The second half of 2009 saw the return of many of the more cautious participants to the market and Petra noted a strong increase in attendance at its tenders, the statement said.
Certainly levels of competition for rough diamonds are now much closer to normal and serve to underpin the stability of the market.
“As we enter 2010, Petra’s management believes the market to be in a much stronger position, particularly given that retailers and cutting centres will soon need to replenish their inventories in order to satisfy increased demand as global economic recovery continues,” the miner said.
The company is on track to achieve its production target of 1.2 million carats for the 2010 financial year.
Longer term, Petra’s current expansion plan will take production to over 3 million carats per annum by 2019.