Tuesday, November 30, 2021

De Beers’ rough diamond sales slumped 39% in 2015

Rough diamond sales for De Beers slumped 39 percent to 19.9 million carats in 2015, according to the firm’s parent company Anglo American. In its production report for the fourth quarter of 2015, the company said that the drop in sales was due to a 12 percent fall in production to 28.7 million carats. It said production slowed down in response to current trading conditions.

 

Diamond production for the fourth quarter of 2015 decreased 16 percent year-on-year to 7.1 million carats, while rough diamond sales volumes stood at 3.6 million carats compared with three million carats in the previous quarter. The company, which recently completed the sale of its Kimberley mine in South Africa and suspended operations at its Snap Lake mine in Canada, said this reflected the weaker trading conditions and higher pipeline stocks that impacted upon the midstream.  

Meanwhile, De Beers also reported that its rough diamond price index was around eight percent lower in 2015 than in 2014, with the index falling by 15 percent over the course of the year. Despite this, the average realised price at $207 (┬ú144) per carat was five percent higher due to a “higher quality average product mix”.

The 2015 figures were released after De Beers sold $540m (┬ú380m) worth of rough diamonds in the first sales cycle of 2016, more than doubling the value achieved in the company’s final sales cycle of 2015. Available production figures show that since the second quarter of 2015, De Beers has been experiencing a significant reduction in the sale of rough diamonds due to weak demand as a result of a global macro- economic slowdown and the strengthening of the US dollar which have put liquidity pressures on cutting and polishing centres. In December 2015, Debswana Diamond Company announced that it will shut down its Damtshaa Mine, which is part of the Orapa, Letlhakane mines, as a result of a slowdown in the global diamond industry. Sunday Standard is informed that the mine has been placed on care and maintenance from 1 January 2016. During the shutdown, Orapa Mine plant  1 will  run  at  reduced  production  levels  of  approximately  one  million carats  per  year  in  order to maintain plant readiness to ramp up production quickly should it be required, Debswana Head of Corporate Affairs, Esther Kanaimba-Senai told Sunday Standard late last year. She further said Debswana has revised its production target for 2016 to 20 million carats to match expected levels of demand for rough diamonds. 

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