China, India to spur diamond market: Rio

Rio Tinto, the world's third-largest mining company, expected world diamond demand to grow 3 per cent annually through 2016 with China, India and the US leading the growth in diamond jewellery, said Steve Hodgson, managing director of the company's diamond unit.

Rio Tinto said it expects profit and sales at its diamond unit to improve this year, helped by a rise in prices.

The company's diamond sales fell 22 per cent to $838 million in 2006, while underlying earnings at its diamond operation fell 27 per cent to $205 million, according to the company's annual results.

"We expect it to improve this year,'' said Hodgson today at a diamond conference in Mumbai.

"We are expecting prices to be modestly better than the last year,'' he said.

Rio Tinto raised some prices and lowered others, Polished Prices, a diamond industry newswire reported on January 16.

De Beers, the world's largest diamond company, also raised some gem prices in January, while cutting others after reviewing production forecasts from its mines and those of its partners.