De Beers had its biggest diamond sale in at least a year as the gem industry restocked after the key holiday period.

The company, owned by Anglo American Plc, sold $720 million of diamonds in its first sale of the year, compared with $545 million at last year’s January offering, it said in a statement Tuesday. The world’s biggest diamond producer said it saw “good demand” across most diamond categories, while there was a larger-than-usual gap between its previous sale.

The large amount may help boost confidence that demand is continuing to rebound after a slump in 2015. It’s also a sign that trade buyers in India, who handle as much as 90 percent of the world’s rough diamonds, are recovering from wide-ranging currency reforms in November that created a cash crunch.

De Beers’s first sale of the year, which gives traders a chance to replenish stocks following the crucial holiday period, followed its smallest offering of 2016 in December. The firm’s biggest sale last year was $666 million in April.

Anglo American shares climbed as much as 4.7 percent to near the highest in more than two years and was up 4.3 percent by 8:42 a.m. in London. Alrosa PJSC, the second-biggest producer, gained as much as 4.6 percent in Moscow.

Indian Impact

De Beers offered concessions to buyers in recent sales to support the market in the wake of Indian Prime Minister Narendra Modi’s fight against so-called black money. The lowest end of the market has been hit hardest as more cutters and polishers of cheap stones use cash to fund their businesses. De Beers cautioned Tuesday that this part of the industry is still being affected.

“While the reopening of some diamond polishing operations in India saw something of an increase in demand for smaller, lower quality rough diamonds, we maintain a cautious outlook for these categories as the Indian industry continues to adjust to the post-demonetization environment,” De Beers said.

Read more: How Indian cash reforms have hit the market.

The company sells its diamonds at 10 sales a year, known as sights, in Botswana’s capital Gaborone. It invites about 80 customers, known as sightholders, who buy the diamonds at prices set by De Beers. The company started publishing its sales figures in January last year.

Source: Bloomberg



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