De Beers Just Showed Us How Big The Diamond Industry Really Is

De Beers Group Of Companies is the largest diamond producer in the world. The company is so influential in the diamond industry that it once created a monopoly on all production and distribution of diamonds coming out of South Africa back in the 1880s. Today, De Beers is still known as the 800-pound gorilla in the diamond industry.

However, as De Beers used to be a private company owned by the Oppenheimer Family, the details of the business was never known to the public. The Oppenheimer Family has since sold their 85% stake in the business to Anglo American PLC (LON: AAL), and Anglo American has decided to share some details of the business to the public in the spirit of transparency.

For investors in Singapore, this new information might give us a better understanding of the diamond industry, in particular of the industry of Sarine Technologies Ltd (SGX: U77), an equipment supplier and service provider to the diamond industry.

First Important Fact

Unlike most other precious commodities such as gold or platinum which has industrial or investment usage, 99% of the demand for diamonds is in the jewellery industry. As at 2013, the global consumer demand for diamond was about US$25 billion in value. The United States and  China are the two largest diamond market in the world, contributing about 56% of the world’s demand. In the same year, 146 million Carats of diamonds were mined globally, and were worth US$18 billion. The De Beers Group produced 33% of the world diamond production.

Interesting Find

From the presentation from De Beers, it mentioned that there is an “industry-leading online auction platform” in Singapore that allows customers to trade diamonds. It is unsure if the auction platform is the one owned by Sarine Technologies but if it is, it means that industry leader De Beers has recognized the technology and that is definitely a great prospect for the platform.

Where Does Sarine Technologies Stand?

The report also mentioned that technology is transforming all stages of the value chain in the diamond industry and online channels will be more important for the diamond purchasing consideration in the future. All these are great news for Sarine as this is the space where the company is actively operating in. The new technology of Sarine will be very important to the company as the industry transform to the new technological world.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore writer Stanley Lim doesn’t own shares in any companies mentioned.