With the firecrackers of Diwali, which resounded throughout certain quarters of Johannesburg suburbia towards the end of October, comes cordite – and hope.
In fact, any phrase ending in the word ‘festival’ is likely to be welcomed by the world’s diamond sector, which has this year seen average prices plummet 35% below levels of 2014 to 20 17.
That’s because festivals often mean diamond (and gold jewellery) purchases.
Thanksgiving in the US – the world’s largest diamond market and which is still holding its own – follows Diwali; and Christmas and New Year’s celebrations follow Thanksgiving. By February, the diamond sector hopes to be clapping itself on its lucent back, wondering what all the panic was about anyway.
In October data from De Beers showed its last cycle of sales totalling $295m. Compared to the previous cycle of sales, about six weeks earlier, this was an advance but year-on-year, sales were nearly $100m less, which is heavy.
The expectation is that the sector is through the worst, but diamond equities have been well and truly smacked. Lucara Diamond, a company listed in Toronto but which operates the Karowe mine in Botswana, was the latest to fall victim – sliding about a third in September to its lowest level in five years.
This story is from the 7 November 2019 edition of Finweek English.
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This story is from the 7 November 2019 edition of Finweek English.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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