De Beers Rough Diamond Production Continues To Dip

  • Heavy rains, COVID-19 to blame

GAZETTE REPORTER

Rough diamond production at the world’s leading diamond company, De Beers, decreased by 7 percent to 7.2 million carats in the first quarter of 2021 (Q1), which ended 31 March 2021, The Botswana Gazette has established.

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According to a report by De Beers parent company, Anglo American, the decrease in rough diamond production was driven by operational challenges, including excessive rainfall in southern Africa and a COVID-19-related shutdown in Canada, as well as planned maintenance in Namibia.

“In Botswana, production decreased by 12 percent to 5.0 million carats, driven by a 24 percent reduction at Orapa due to a lower grade feed to the plant in response to heavy rainfall and operational issues, including continued power supply disruptions,” Anglo American noted.

Anglo noted that in neighboring Namibia, production decreased by 34 percent to 0.3 million carats, primarily as the Mafuta vessel was under planned maintenance and another vessel remained demobilised as part of the response to lower demand implemented in Q3 2020.

South African production, on the other hand, increased by 55 percent to 1.2 million carats
due to planned treatment of higher grade ore from open pit final cut whereas in Canada production decreased by 16 percent to 0.7 million carats primarily as a result of a COVID-19-related suspension of operations in February.

The De Beers parent company further noted that demand for rough diamonds in Q1 2021 recovered to pre-COVID-19 levels, reflecting the replenishment of the depleted midstream and renewed confidence by the midstream in response to the return of consumer demand for diamond jewelry in the US and China in the second half of 2020.

“Rough diamond sales totaled 13.5(3) million carats (12.7 million carats on a consolidated basis (2)(3) from three Sights, compared with 8.9 million carats (8.3 million carats on a consolidated basis (2) from two Sights in Q1 2020 and 6.9 million carats (6.4 million carats on a consolidated basis)(2) from two Sights in Q4 2020,” Anglo noted.

De Beers is a multinational company that specialises in diamond exploration, diamond mining, diamond retail, diamond trading and industrial manufacturing. The company is active in open-pit, large-scale alluvial, coastal and deep mining. It operates in 35 countries, including Botswana from where it generates 75 percent of its earnings.

De Beers’ major shareholder is Anglo American, which owns 85 percent of the company.
The remaining 15 percent is owned by the Government of Botswana. De Beers Group and its partners produce around one third of the world’s rough diamonds by value. De Beers sells rough diamonds to global diamantaires through its diamond trading and auctions businesses. It sells polished diamonds and diamond jewellery via its Forevermark and De Beers Jewellers businesses.