De Beers Eases Sightholder Rules In Response To Market Situation

Current market conditions (large inventories and falling polished diamond prices, especially in India) are forcing De Beers to be more flexible with its sightholders. Even though the De Beers spokesperson did not want to comment on this news, according to Rapaport, a note sent to De Beers sightholders reveals that for the "July sight," they will be allowed to refuse up to half of lots in three boxes of medium- and higher-quality rough under 3 grainers (0.75 carats). The flexibilization comes without De Beers customers experiencing an impact on future allocations from the mining company. There will also be flexibility for customers with beneficiation factories, and they will be able to remove lots from an additional 21 boxes. In addition, De Beers will allow sightholders to sell up to 30% of certain rough purchases by carat weight back to the miner without it affecting future allocations.

It is anticipated that this higher degree of flexibility will not only ensure more stable prices but also open up opportunities for increased profitability. With the ability to choose to keep the most profitable products and return the rest, customers can look forward to a more optimistic market outlook.

It is expected that De Beers customers will respond positively to these relaxations and take advantage of this extraordinary flexibility, and thus, the July sight will also reduce sales.

Picture credits: Ben Perry/Armoury Films/De Beers