Facing a challenging diamond market, Anglo American may cut De Beers’ production further as third-quarter output falls sharply.
BONGANI MALUNGA
Anglo American, which holds an 85 percent stake in De Beers, announced it may further cut diamond production. This consideration, as explained by Anglo’s Chief Executive Officer Duncan Wanblad, comes in response to a 25 percent drop in De Beers’ overall production in the third quarter compared to last year.
Botswana’s Production Drop
De Beers’ report last week highlighted a 32 percent decline in Botswana’s diamond production in the third quarter year-over-year. Last year’s output stood at 5,837 carats, but this year’s third-quarter production fell to just under 4,000 carats. The report attributed this reduction mainly to a pre-planned cutback at the Jwaneng Mine.
Namibia and Canada also reported production declines, with Namibia seeing a 14 percent drop and Canada an 11 percent fall. South Africa, however, was the only country in De Beers’ portfolio to experience growth, with production increasing by 41 percent.
Market Conditions and Production Plans
“As previously announced, we reduced rough diamond production from De Beers in response to market conditions,” said Wanblad. “The diamond market remains challenging, with higher-than-normal inventory levels, and we anticipate a gradual recovery. We will continue to assess options to reduce production going forward,” he noted in multiple global media reports.
Sale of De Beers
Despite these challenges, Anglo American is still committed to selling its controlling stake in De Beers by the end of 2025, exploring options that include an initial public offering (IPO). “The plan is to get it done. There is no way De Beers is a fit in the Anglo portfolio. There is no flip-flop possibility,” Wanblad affirmed at the Financial Times Mining Summit in London last month.