De Beers, the world's biggest diamond miner, believes the supply of the gems is running out over the long term, prompting it to reduce production to extend the life of its mines.
Assuming this moderated production, rough diamond prices could rise by at least 5 per cent per year for the next five years, said Des Kilalea, diamond analyst at RBC Capital Markets.
De Beers' move, which will see production plateau at about 40m carats a year from 2011 compared with 2008 production of 48m carats, anticipates new Asian demand accelerating the depletion of the world's existing diamond mines, said Gareth Penny, managing director.
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