DE Beers Will Reduce the Price of First Natural Diamonds This Year

Sources say that the world's largest diamond supplier - De Beers Group of Companies will reduce the price of the first natural diamonds this year as the demand for global diamond products is weakened sharply and in 2015, the company had reduced the production and prices for rough diamonds.

Three sources told Bloomberg that the parent company of De Beers - Anglo American PLC (AAL.L) will reduce the price of rough diamond by 7%. The first diamonds are expected to up the sales of $450 million.

According to the British industry - WWW International Diamond Consultants, the diamond prices have fallen by 18% in 2015.

Because the demand for global diamond products is weakened, Tiffany & Co. (NYSE: TIF) that has been the first choice of many married middle-class people also fails. The jeweler once posted holiday season results in the United States, which has a 6% year-on-year decline, and then the group reduced its full-year profit forecast and announced job cuts. Tiffany & Co. Tiffany is sold well in Europe, Americas and Asia market, and behind it all is caused by the demand of Chinese consumers. The consumption growth of Chinese consumers in Europe, the United States and Japan shows a decline at the end of the year. China's economy encountered embarrassment in 2015, and the stock market caused huge loss for private investors in the open market.

De Beers once lowered the production for three times in 2015, from the original 34 million carats to 29 million carats, and this year the company expects the production should be about 26 million carats - 28 million carats, lower than in 2015. De Beers said in December 2015, the global market of rough diamonds shrank by 2%, and Philippe Mellier pointed out that the current diamond industry is in "Stock crisis".

Due to the weak demand, diamond industry has reduced the staff since last year. Tiffany & Co. today also says that they will reduce the staff, although they do not disclose specific details. But De Beers is expected to reduce the staff about 1500 in Canada, South Africa and its subsidiary Element Six. De Beers’ parent company - Anglo American PLC also hopes to reduce the staff from 135000 to 50000 through reorganization. Panmure Gordon & Co. expects that the diamond prices still have 5% of hitting space, until the second quarter to stability.