Rio Tinto Group raised prices for the diamonds it mines in Canada by 15% last month as demand recovered, Bloomberg reported.
The increase from the prior month was for diamonds from Rio’s 60 percent-owned Diavik mine, said Bret Clayton, chief executive officer for diamonds, copper and nickel. While retail diamond sales fell by about a third during the world financial crisis, sales by mining companies slumped as much as 70% as wholesalers used up their stockpiles, he added.
“We’re seeing demand start to pick up,” Clayton said today in an interview in London, where Rio is based. “The supply chain is now de-stocked, so we are starting to see some pull-through in demand for diamonds.”
Rough diamond prices are rebounding after falling as much as 65% from September last year through March, according to Ambrian Partners Ltd, the Bloomberg report said.
Rio, which operates the Argyle mine in Western Australia, is studying projects in the Democratic Republic of Congo and India, Eric Finlayson, the company’s exploration chief, said last month. The company also said it would resume an A$1.8 billion ($1.6 billion) expansion at Argyle, said the report.
Clayton declined to comment on reports Rio and BHP Billiton Ltd., the world’s biggest mining company, may combine Canadian diamond operations. Rio regularly talks with BHP and De Beers, which also operates in the country, on saving money, he said.
Rio and BHP are considering a A$1 billion merger of their Canadian diamond operations, the Australian reported on September 7, without saying where it got the information. BHP has sent employees to Canada to investigate how its Ekati mine and Rio’s adjacent Diavik mine could be combined, the newspaper said.
Bloomberg News.