July 3, 2001
Dealers Push De Beers to Lower Sales Target
Diamond giant De Beers is under pressure from diamond dealers to reduce its $4.8 billion sales goal for 2001 due to sluggish demand, the Financial Times reports.
Diamond dealers say they fear De Beers sending $4.8 billion of rough diamonds into the market, which will create a $1 billion surplus of diamonds. Many dealers have seen their inventories increase as prices and the availability of credit decreased, so they want De Beers to reduce its sales volume while they clean out their backlogs, the Financial Times reports. Analysts say De Beers also risks starting a diamond price war if it manages to reach its $4.8 billion goal.
De Beers is reluctant to give up on its sales goal, and the company said in June its first-half sales were on target with the full-year goal. It has offered to adjust its assortments to assists its sightholders, the Financial Times reports.
- by Julia M. Duncan