De Beers CEO Phillipe Mellier has said that rough diamond sales have bounced back in the first two sales cycles for the year to much healthier levels, indicating potential for better industry conditions in the year ahead. He was speaking to representatives from many of India’s banks at a closed door meeting at Bharat Diamond Bourse in Mumbai, yesterday.

Describing the past year as one that presented a variety of challenges for the sector as a number of unexpected issues came to pass at the same time, Mellier said that it was a sort of ‘perfect storm’ of problems.

The industry as a whole responded swiftly and decisively, and De Beers took a number of steps to help support profitability, downstream demand, midstream confidence and supply responsibility, he said.

The improvement in early 2016 has been rapid, and is testament to the industry’s capacity to take control of its destiny in difficult times, he added.

Mellier said that just as De Beers stressed increased financial transparency and robustness for its clients, it continued to reduce the historical opacity of the broader diamond industry by publishing more data on upstream production, midstream sales and downstream demand.

Commenting on the compelling long-term demand opportunity, especially In the emerging markets, where middle classes continue to grow rapidly and consumers are becoming increasingly captivated by the diamond dream, Mellier said it is notable that the US – the world’s largest and most mature consumer market for diamond jewellery – continues to grow the fastest of all, even as Chinese growth rates may have slowed due to macroeconomic pressures.

He also said that while rough diamond production is forecast to plateau and then start to decline in the coming decade, the investments De Beers is making to extend production capacity will leave its customers very well placed to take advantage of the sector’s positive fundamentals over the next decade and beyond.

Saying that there are a number of challenges that the industry will need to address in the coming years and these will come from both within and outside the world of diamonds, he concluded that “the industry’s medium to long-term outlook makes this a very investable sector”.