Diamond miner Rio Tinto expects the plunge in diamond sales to taper off as destocking ends, but its diamonds mines could see further cutbacks if an improvement fails to emerge, an executive said yesterday, Reuters reported.



Rio Tinto has cut diamond production by about a quarter due to the downturn, Bret Clayton, chief executive of Rio's diamond and copper unit, told the Mining Investment Congress in London, the report said.



Prices have slid by around 30 - 40%, Clayton said.



"Our anticipation is that the destocking of the supply chain has largely finished," he said.



"While we're not anticipating a recovery in the diamond market, what we're anticipating is normal pull-through of the volumes."



Sales of rough diamonds have collapsed by about 70%, but that is expected to improve to about a 30% fall, in line with underlying retail diamond jewelry sales, Clayton added.



"That's a market we're watching very closely. If we don't start to see that trend, we'll step back and make another assessment of our diamond operations."



While in copper, Rio had no fears of its operations becoming cash negative due to the slide in prices, the situation in diamonds has been more difficult. "In diamonds we've been working to be close to break even."