Softer demand across the supply chain dampened De Beers’ first-half revenues, with the company saying macroeconomic uncertainties could continue to impact consumer spending in the near term.

De Beers’ total revenue fell by 22 per cent to US$2.8 billion in the first six months of 2023 while rough diamond sales decreased 24 per cent to US$2.5 billion.

According to Anglo American, which owns 85 per cent of De Beers Group, ongoing macroeconomic headwinds and high levels of polished diamond inventory in the midstream affected demand for rough diamonds. Profitability came under strain from softer polished prices and higher financing costs, it added. 

Average realised price in the first half was down 23 per cent to US$163 a carat due to a higher proportion of lower-value rough diamonds being offloaded in 2023. This also indicated a more cautious approach that Sightholders are taking to planning their 2023 allocation schedule. 

The average rough diamond price index also dipped 2 per cent, reflecting the overall softening in consumer demand for diamond jewellery and build-up in rough diamond inventory in the midstream.

The underlying demand for branded diamond jewellery, however, remains strong, noted De Beers. De Beers Jewellers delivered a solid first half performance with double-digit growth as it focuses on developing the brand in China.

“Despite near-term challenges faced by the diamond industry, our research confirms consumers’ desire for natural diamonds, which is expected to remain robust in key consumer markets in the long term,” De Beers stated. “The global supply of rough diamonds is expected to decline owing to limited new discoveries, which in turn is expected to support value growth potential for natural diamonds.

Production guidance for 2023 stands at 30 million to 33 million carats, the company said.