Tue, January 18, 2011
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Diamonds sparkle for China and India

2011-01-18 09:16:21 GMT2011-01-18 17:16:21(Beijing Time)  SINA.com

Demand for rough diamonds from China and India is helping boost the price of the precious stone.

High security on a London rooftoop and a rare chance for Reuters to see inside a diamond vault.

Diamond manufacturer Erez Daleyot is on his way to a De Beers viewing room.

It's his first opportunity of the year to buy his allocation of rough diamonds.

His inspection of the precious stones worth between 10-15 million U.S dollars is known as a sight, where he can look at the diamonds in more detail and decide whether or not to buy them.

Daleyot specialises in larger sized stones, he says he sees a strong demand from markets like China.

(SOUNDBITE) (English) EREZ DALEYOT, CEO OF DD MANUFACTURING, SAYING:

''In what actually I see, that like 60 percent of all the larger stones are now actually going to the Far East and to China, which we didn't see it before.''

Each sightholder is allocated a case with their stones and there are more than half a billion dollars worth of diamonds in this room.

These rough diamonds come from mines in Africa and Canada, they're worth a total of around 6 million U.S dollars and they're among millions of rough diamonds that sight holders can snap up at the De Beers Diamond Trading Company.

With the majority of sightholders now based in Surat, India is also another main market player.

Varda Shine is Managing Director of the De Beers distribution arm.

She says rough diamond prices are rising and have returned to pre-recession levels due to demand from countries like India and China.

(SOUNDBITE) (English) VARDA SHINE, MANAGING DIRECTOR DIAMOND TRADING COMPANY, SAYING:

''Over the last two years when America was in a heavy recession, then over the last two years we had China and India growing demand by over 20 percent a year and this year ut's looking like another high double digit, probably close to 20 percent again.''

Engagement and wedding rings continue to be the most popular choice. But Shine says seasonal shopping trends are changing.

(SOUNDBITE) (English) VARDA SHINE, MANAGING DIRECTOR DIAMOND TRADING COMPANY, SAYING:

''In the past really most of our sales used to take part in Thanksgiving to Christmas. That was 40 percent of the world's sales of diamond jewellery. Now that we do have the wedding season in India and Diwali and we have Chinese New Year. We actually are seeing that the sales are staggering over a much longer period of time, which is great because it does diversify the risk it does give people the ability to plan their businesses better.''

For De Beers all that glitters isn't gold, as consumer demand increases they expect sales of the precious stone to continue to have a sparkling future.

(Reuters)

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