De Beers has stripped around 10 sightholders of their rough-diamond allocations for 2025 and is planning to offer fewer goods overall, market insiders told Rapaport News.
Those companies will retain their sightholder status, but the miner will not give them a consistent allotment of supply because they did not buy enough in 2024, the sources said. Several of them are in mining countries such as Botswana, where rough purchases and polished production have slumped this year, they added.
The total value of allocations next year will be 20% to 30% lower than this year, according to the sources’ estimates, reflecting a drop in production volume as well as a weakening of prices. The decline in volume will likely be gentler than this.
De Beers released its 2025 ‘intention to offer’ (ITO) on Friday, informing sightholders how much rough they will likely receive during the year. De Beers reviews this annually, basing its decisions on clients’ past buying records as well as expected availability of production. Sightholders without an ITO can still obtain goods on an ad-hoc basis.
Last Wednesday, it told sightholders it had made ‘adjustments’ to the volume of supply it will offer next year, without giving specifics, according to a letter seen by Rapaport News.
The reasons, the letter continued, included variations in production forecasts at mines as well as ‘demonstrated demand’ — the term for clients’ past purchasing performance. It also cited ‘sightholders’ manufacturing arrangements and distribution and marketing requirements.”
The developments also come amid uncertainty about De Beers’ future access to production from Botswana, where negotiations with the government over a sales deal are ongoing. A De Beers spokesperson declined to comment on the contents of the letter.
The results did not surprise customers, as the miner had told them it would enforce its minimum 2024 purchase requirement of US$15 million and three boxes of goods.
Some market observers see the trimming of active customers as a step toward a reduction in the official number of sightholders — a plan that CEO Al Cook discussed last month at the Facets 2024 conference in Antwerp.
In a similar vein, the company has also told sightholders they must earmark 50% of their allotted goods by value to each half of the year. They were previously able to allocate up to 60% to one half and 40% to the other. Dealers see this as an effort to improve cash flow and weed out weaker players.
Sightholders ‘should’ also distribute these purchases evenly so that 25% occur in each quarter, De Beers told them in the Wednesday letter. The language implied this was not a requirement. They will be able to request one deferral of goods per half year, as in the past, but will not be able to delay goods from the first half to the second half.
In 2024, De Beers’ sales were heavily weighted toward the first half, when the market appeared to be recovering after a downturn in 2023. The year-on-year decline in De Beers’ consolidated rough sales value worsened from 20% in the first half of 2024 to 76% in the third quarter as a slump in demand forced the company to loosen its supply rules. -Rapaport News.
