Namdia to buy diamonds again
• September stock sold in December
Diamond sales continue to struggle, but the Namdia CEO says the state-owned enterprise is financially secure.
Namib Desert Diamonds (Namdia) intends to buy diamonds again this month, after its last purchases were made in September 2023. The main purpose of the government diamond marketing and sales company's existence is to undertake price discovery on the international market, with a view of getting better prices for Namibia's diamonds.
Diamond prices have, however, been severely depressed in recent months by large inventories and weakened demand for natural diamonds - in part due to the success of lab-grown diamonds encroaching on the engagement ring segment.
“Namdia will purchase diamonds for its upcoming sales cycle in January. This represents the first acquisition since September 2023," the state-owned company's CEO Alisa Amupolo said.
Namdia is entitled to buy a 15% share of Namibia Diamond Trading Company's (NDTC) diamonds every month.
"Despite lower margins due to prevailing market conditions, Namdia was able to successfully sell its September inventory in December 2023," she added.
Optimistic
The industry has not yet fully recovered from the current economic downturn, as it is constantly grappling with challenges, but Namdia remains optimistic about the market's improvement, Amupolo said.
Since September 2023, there has been a reduction in cut diamond stock and De Beers has reduced prices on its first sales for the year, she noted. But lab-grown diamonds still remain a threat to the natural diamond industry.
Meanwhile, Indian authorities lifted a voluntary import ban on 15 December, which somewhat stabilised the supply-demand balance, she said. Another important development is that the G7 sanctions on Russian diamonds came into force on 1 January.
“Namdia's customer relationships have produced positive results, enabling us to retain all our customers. This loyalty and commitment from our customers reflects the support shown during the Covid-19 pandemic, and serves as a testament to Namdia's unwavering commitment to cultivating lasting and mutually beneficial relationships."
“Considering market uncertainty and the pessimistic outlook at the time, Namdia decided to sell inventory during December 2023 to mitigate any depreciation. Secondly, we have implemented cost containment measures in our operations. Finally, Namdia remains vigilant in monitoring and assessing market conditions to better inform our sales strategy," Amupolo noted.
"Based on our current financial analysis and operational evaluations, Namdia is in a secure financial position, indicating that there is no need for a government bailout," Amupolo insisted.
According to her, Namdia will continue to implement its mandate of price discovery for the benefit of all Namibians. "Namdia plans to continuously strive to fulfill its mandate of price discovery and also the implementation of community projects through the Namdia Foundation."
Diamond prices have, however, been severely depressed in recent months by large inventories and weakened demand for natural diamonds - in part due to the success of lab-grown diamonds encroaching on the engagement ring segment.
“Namdia will purchase diamonds for its upcoming sales cycle in January. This represents the first acquisition since September 2023," the state-owned company's CEO Alisa Amupolo said.
Namdia is entitled to buy a 15% share of Namibia Diamond Trading Company's (NDTC) diamonds every month.
"Despite lower margins due to prevailing market conditions, Namdia was able to successfully sell its September inventory in December 2023," she added.
Optimistic
The industry has not yet fully recovered from the current economic downturn, as it is constantly grappling with challenges, but Namdia remains optimistic about the market's improvement, Amupolo said.
Since September 2023, there has been a reduction in cut diamond stock and De Beers has reduced prices on its first sales for the year, she noted. But lab-grown diamonds still remain a threat to the natural diamond industry.
Meanwhile, Indian authorities lifted a voluntary import ban on 15 December, which somewhat stabilised the supply-demand balance, she said. Another important development is that the G7 sanctions on Russian diamonds came into force on 1 January.
“Namdia's customer relationships have produced positive results, enabling us to retain all our customers. This loyalty and commitment from our customers reflects the support shown during the Covid-19 pandemic, and serves as a testament to Namdia's unwavering commitment to cultivating lasting and mutually beneficial relationships."
“Considering market uncertainty and the pessimistic outlook at the time, Namdia decided to sell inventory during December 2023 to mitigate any depreciation. Secondly, we have implemented cost containment measures in our operations. Finally, Namdia remains vigilant in monitoring and assessing market conditions to better inform our sales strategy," Amupolo noted.
"Based on our current financial analysis and operational evaluations, Namdia is in a secure financial position, indicating that there is no need for a government bailout," Amupolo insisted.
According to her, Namdia will continue to implement its mandate of price discovery for the benefit of all Namibians. "Namdia plans to continuously strive to fulfill its mandate of price discovery and also the implementation of community projects through the Namdia Foundation."
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