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Diamdel Sales Rise 30% in 2011

Feb 13, 2012 3:45 AM   By Avi Krawitz
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RAPAPORT... Diamdel sales rose 30 percent year on year to $405 million in 2011 as the De Beers subsidiary successfully expanded its online auctions.

''Further sales and pricing innovation and an unprecedented global expansion program enabled Diamdel to capitalize on exceptional buyer demand and deliver record performance for our shareholders,'' said Neil Ventura, Diamdel’s chief executive in the De Beers annual report published Friday.

De Beers noted that the sales were the highest achieved by Diamdel since 2006. Strong demand in the first eight months of the year softened in September as the market shifted to a supply surplus, the company explained.

De Beers supplies approximately 10 percent of its production to Diamdel, which sells to the open market via its online auctions. The unit held 134 auctions during the year with 281 buyers placing bids, of which 182 emerged as winners. The number of lots offered rose 109 percent to 2,614.

During the year, Diamdel opened the auctions to allow Diamond Trading Company (DTC) sightholders to participate and introduced a more dynamic interaction between Diamdel and the DTC.

Philippe Mellier, De Beers chief executive, said the auctions provide De Beers with an important tool for price discovery. ''The auctions are very interesting for us to uncover pricing potential, especially if we have problems with certain assortments in terms of pricing,'' Mellier told Rapaport News. ''Diamdel is a very good tool to understand the market perception of the different assortments and the price position of our boxes on a very short term basis.''

While Mellier stressed the importance of De Beers longterm supply to sightholders, the company continued to expand the Diamdel business in 2011. Diamdel improved its capacities in Antwerp, relocated to larger premises in Tel Aviv and Hong Kong and opened an office in Dubai.  

De Beers explained that these investments have favorably positioned Diamdel to capture spot prices that better reflect short term global supply and demand fundamentals. 

Tags: Avi Krawitz, De Beers, Diamdel, diamonds, Rapaport
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