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Diamond
Output Growth could slow down says
DTC.
( September 28, 2004)...Although there have
been encouraging first half growth in diamond jewelry sales, the De Beers group
announced that it still remains unsure about diamond production growth for the
latter half of the year. Speaking to analysts at a seminar, the De Beer group
announced that although there are optimistic signs about the future, nothing
could be said at the moment about the actual trends.
Compared to 40.2 million
carats in 2002 and 44 million carats in 2003,
2004 is expected to yield 45.2 million carats.
On a whole the company predicts a slowdown of 3%
from the 9%growth figures of last year. At the
current rate the company expects to produce
around 55 million carats by 2009.
For the 2004 diamond production shares:
De Beers Consolidated Mines: 13.5 million carats Debswana Diamond Co.
(Botswana): 29.8 million carats Namdeb Diamond Corp. (PTY) Ltd. : 1.8 million
carats
William Diamonds Ltd.: 0.4 million carats
Diamond Jewelry Sales in US Dollar terms, for the first half of 2004 rose by 8%
compared to 6% for the whole of 2003 and 4% for the period between 1999-2003.
The figures in local currency terms were as follows:
The figures were quite bleak for Japan with only 1% sales growth and Germany
& Italy with a decline of 3% and 4% respectively. The Rough market has
increased its growth level till July this year compared to the same period last
year. Polished exports rose 21% from January to July for 2004.
The increase in prices since the start of 2004 is
still dominant, but their long term effect is being measured by slower trading.
The stocks are also 18% lower in the polished market compared to stocks in July
2003.The economic slowdown in the Japan and US is also expected with increased
competition from indirect high end competitors to the diamond industry such as
luxury travel, luxury watches, hi-tech equipment, luxury leather goods and
luxury fashion.
De Beers identified its major challenges as the
company's market share ,renewing the strength of the South African rand and its
on marginal mines, working stock levels, the Jwaneng lease in Botswana, , and
the Alrosa contract. The first half sales for DTC were close to $ 3 billion an
increase of around 2 % whereas headline earnings were at $425 million, up 13 %.
Compared to the world production of $9.1 billion in rough De Beers production
was worth $ 3.6 billion. For a total world supply of $10.1 billion De Beers
also supplied $5.6 billion worth of rough.
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