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Five percent price hike for rough diamond prices by De Beers

De Beers has raised its rough diamond prices by 5% due to strong demand from Asian markets outstripping supply.

Posted: Friday , 11 Jul 2008

LONDON (Reuters) -

The world's biggest diamond producer De Beers boosted rough diamond prices by an averge of 5 percent this month, the firm said on Friday.

The price hike by the group's marketing arm, the Diamond Trading Company (DTC), came amid strong demand for diamonds in Asian emerging markets and tight supply, which led to price increases of 8.5 percent earlier this year. [ID:nL25886267]

A De Beers official said last month that buoyant diamond demand from China, India and the Middle East would more than offset expected slower sales in the United States, which accounts for half of the diamond jewellery market. [ID:nL04940045]

De Beers, 45 percent owned by mining group Anglo American , made the price increase during the firm's July "sight" this week, one of 10 week-long events during the year at which the DTC markets rough diamonds to tightly-screened clients.

"Some increases have been made at the July Sight, the overall effect of which is plus 5 percent," De Beers said in an email in response to a query.

De Beers said in February that it expected a rebound in its rough diamond sales this year after a dip in 2007.

Sales fell 3.7 percent to $5.9 billion last year, but supply shortages were expected to keep prices strong and help to lift the 2008 sales figures, De Beers had said.

De Beers, which controls around 40 percent of the diamond market, posted flat output of diamonds last year at 51 million carats and a steady result is expected in 2008.

(Reporting by Eric Onstad, Editing by Peter Blackburn)