Morning Bites (part 2)

💎De Beers has reduced rough prices to bolster sales at its 1st cycle in 2024, Bloomberg reports, citing people familiar with the matter. The miner lowered prices 5-10% for rough stones under 0.75ct, with no reductions for the smallest items. Larger stones (2-4ct) have seen the biggest cuts, of up to 25% in some categories. In our view, the decline was likely driven by the overall mix worsening, as well as De Beers' potential liquidity needs (the company suspended sales in late-2023 and so might have attempted to sell the maximum feasible volumes). Furthermore, the current market environment could be similar to the 2015-16 stress period, when rough sales and prices showed a robust recovery from the very bottom

As such, if prices start to recover in the next 2-3 months, that might be a strong signal of an upcoming market turnaround. We also await De Beers' market comments in its cycle 1 report (due on 31 January)

#diamonds
https://metals-wire.com/sector/Diamonds