Picture: REUTERS
Uncut diamonds at De Beers’ offices in London. Picture: REUTERS

DE Beers, the world’s largest producer of rough diamonds by value, said it sold $540m worth of diamonds in its first of sale of the year, more than doubling the value of the sales achieved in the final sale of last year.

De Beers holds 10 sales events a year — called sights — for hand-picked buyers called sightholders. In the final of 10 sights last year, De Beers recorded sales of $248m.

"A positive holiday season in the US from a retail perspective, low levels of diamond purchases by the midstream in fourth quarter 2015 and a subsequent reduction in manufacturing saw polished diamond stocks pull through the pipeline," De Beers said.

The midstream is an industry term for cutting and polishing of rough diamonds to produce diamonds for jewellery makers.

"Rough diamond demand broadened across the entire product range as cutting and polishing factories began to increase their activity," it said.

The US is the single largest market for diamond jewellery and De Beers pumped tens of millions of dollars into advertising diamonds over the year-end period, when a third of the world’s diamond sales are made in a six-week period in that country. The intention was to increase demand for polished diamonds and unblock the pipeline in the cutting and polishing segment.

Prices for rough diamonds were weak last year because of an oversupply of diamonds in the cutting and polishing segment, forcing companies such as De Beers and Alrosa, the two largest companies, to curtail their supply of stones to the market to restore equilibrium and prices.

De Beers has said it will change the way it operates its sights to become more flexible and responsive to its clients.