First Quarter Reflections: Fulfillment & Frustration

Can you believe we’re already at the end of March? The first quarter has flown by, marking not just a milestone in the year but also the close of the financial year for many.

On a personal note, these past three months have been a whirlwind. The launch of The Diamond Press has been an exciting journey — one filled with skill-building, creative fulfillment, and, admittedly, a bit of frustration at not being able to roll out all the initiatives at once. But great things take time, and I’m thrilled about what’s ahead. With each step, we’re shaping The Diamond Press into a dynamic, insightful platform for the diamond industry.

If you have any questions, potential collaboration ideas, or just want to exchange thoughts on moving the industry forward, I’d love to connect. Let’s keep the conversation going!

Hot Off The Diamond Press

• 5 Diamond Market Highlights of 1Q (Video)

• March News Roundup (Blog Post)

This Week’s Pressing Matters

>>> De Beers “IPOtential”: Anglo American Explores a Public Listing

Anglo American has reportedly begun discussions with banks about listing De Beers, even as it continues searching for a buyer for its diamond unit, according to Bloomberg.  

Now that De Beers’ agreement with the Government of Botswana is signed (see, What’s The Deal With De Beers And Botswana?), this development is set to dominate diamond industry headlines — and for good reason. Anglo currently owns an 85% stake in De Beers, with Botswana holding the remaining 15%. Last year, Anglo announced plans to divest its stake, but finding a buyer has been anything but easy.

Market timing hasn’t been in De Beers’ favor. The diamond industry faced significant declines in 2024, leading to a slump in De Beers’ earnings. In response, CEO Al Cook introduced the ‘Origins Strategy’ to showcase the company's value, but Anglo still took a $2.88 billion write-down on De Beers, leaving its recoverable value at $4.1 billion by year-end. Reports suggest Anglo even rejected a $1 billion offer from a Middle Eastern sovereign wealth fund—far below its expectations.

With no clear buyer in sight, an IPO may now be Anglo’s best option. But any decision will have to consider its key partner: the Government of Botswana. Given the government's vested interest in De Beers, it wouldn’t be surprising if Anglo opts to float a majority of its shares while Botswana increases its stake — potentially by 10% to 20% — to emerge as the largest shareholder. Stranger things have happened.

This story is heating up, and its outcome will reshape the diamond industry. Stay tuned.

>>> The Great Chinese Challenge: Diamond Demand Still Lags

Don’t be misled by the (relatively) positive March Hong Kong show — China’s sluggish demand continues to weigh heavily on the global diamond wholesale market.

Our latest reminder comes from Chow Sang Sang, one of Hong Kong’s “Big Three” jewelers (alongside Chow Tai Fook and Luk Fook). The company reported a 15% drop in revenue, falling to HKD 21.18 billion ($2.72 billion) in 2024, while profit declined 21% to HKD 793.6 million ($102.1 million).

Economic uncertainty and record-high gold prices have put pressure on jewelry demand across mainland China and Hong Kong-Macau, where 65% and 33% of Chow Sang Sang’s revenue originate, respectively (the remainder comes from Taiwan).

Interestingly, the company didn’t explicitly mention gem-set jewelry as a primary factor in its weak performance — a telling omission, given that it was the worst-performing segment.

However, the numbers paint a clear picture:

• Gem-set jewelry accounted for just 7% of sales in mainland China and 10% in Hong Kong-Macau, compared to gold jewelry’s overwhelming dominance (80% and 74%, respectively).

• Same-store sales of gem-set jewelry plunged 38% in mainland China and 24% in Hong Kong-Macau—primarily due to falling diamond sales.

• The company cited a significant cultural shift, stating that “as wedding jewelry goes out of fashion, gem-set jewelry sales continue to decline.”

Looking ahead, Chow Sang Sang sees some positive signals, including monetary easing and relaxed travel restrictions for Hong Kong, which are helping retail. But when it comes to diamonds, recovery won’t happen overnight. The company warns that demand for gem-set jewelry will require stronger economic tailwinds, while gold sales are expected to remain volatile as prices hover at record highs.

Clearly, reviving Chinese diamond demand will take time — and perhaps a strategic push from the industry itself.

Chart Check 

2024 wasn’t kind to Mountain Province Diamonds, as it wasn’t to most diamond producers. The miner reported a net loss of $80.8 million, nearly doubling the $43.7 million loss from the previous year. The culprit? A perfect storm of sluggish Chinese demand and market uncertainty fueled by the rising supply of cheaper lab-grown diamonds, which put pressure on prices. As a result, the company’s sales dropped 19% to $267.7 million for the year. While Mountain Province isn’t alone in facing these headwinds, its struggles highlight the ongoing shifts in the diamond market. the big question remains: will the mining segment bounce back this year?

Coming Up

• De Beers sight: March 31 to April 4

• Okavango Diamond Company tender viewing: March 30 to April 9

• Koin International rough tender: April 3 to 7

Pic of the Week

Image: Emerald-cut, 10-carat, D-color, Internally Flawless diamond ring sold for HKD 4.6 million ($587,959) at Phillips Hong Kong auction on March 27. View top 10 here. (Courtesy: Phillips)