The Times of India reports that rough diamond sales by the Diamond Trading Company (DTC) – De Beers’ supplier of rough diamonds – dived by 54% in 2009 compared to 2008 mainly due to reduced demand from its clients in Surat.

In 10 annual sale sights, the DTC reportedly sells over 40% of the world's rough diamonds estimated at $5.95 billion to 79 selected sightholders located mainly in India, Israel and China. Surat annually imports an estimated Rs 30,000 crore worth of rough diamonds – 40% of this volume is supplied by the DTC to 22 Indian sightholders.

The DTC announced that total rough diamond sales from the first seven sights were estimated at $2.23 billion as compared to $4.85 billion during the corresponding period last year. DTC’s August rough diamonds sale to its sightholders in India, which was expected to rise due to demand in the Diwali and Christmas season, declined by 61% to $480 million. During the same month last year, the DTC sold rough diamonds worth $780 million.

The production of rough diamonds has plummeted by 73% to 6.591 million carats in the first half of 2009, following the temporary closure of two diamond mines in Bostwana and Namibia in the last quarter of 2008.

The Times of India quotes Indian sightholders who expressed concern that demand at future sights might be affected by the influx of Russian rough diamonds to the market. In addition, some DTC sightholders stated they may have to cut back on buying if rough diamond prices continue to rise while polished diamond prices remain steady.