De Beers "optimistic" demand to help diamond prices

A worker stands next to diamond jewellery displayed at a diamond exhibition in New Delhi in this September 28, 2006 file photo. De Beers, the world's top diamond producer, is "optimistic" about diamond prices based on limited supply and str

JOHANNESBURG (Reuters) - De Beers, the world's top diamond producer, is "optimistic" about diamond prices based on limited supply and strong demand from India and China, the firm's managing director said on Thursday.

"We are optimistic about diamond prices going forward. We have a situation of capped supply in years ahead and demand is healthy, growing in India and China," Gareth Penny told a conference call.

Penny spoke after De Beers, 45 percent owned by mining group Anglo American Plc, said on Thursday it had sold its historic Cullinan mine to a consortium led by Petra Diamonds for 1 billion rand ($147.5 million) in cash.

Petra's Executive Chairman Adonis Pouroulis said the company would inject $50 million in Cullinan, and could sustain the mine's production of one million carats a year, but declined to make any projections on whether this output could rise.