Global mining company – De Beers has said that an expected increase in ore and improved grade performance at both Jwaneng and Venetia (South Africa) mines will play a critical role in reaching higher production in 2021.
Giving production updates this week, De Beers executives said the company’s production guidance for 2021 is 32–34 million carats, subject to trading conditions, the extent of further Covid-19 related disruptions and ongoing operational challenges.
De Beers says recent consumer demand trends have been positive in key markets and industry inventories are in a healthier position, providing the potential for a continued recovery in rough diamond demand during 2021, subject to the ongoing impact of Covid-19.
The mining company – co-owned by Anglo American (85%) and Botswana (15%), said in early February that owing to the COVID 19 sponsored restrictions on the movement of people and products in various jurisdictions around the globe, it has continued to implement a more flexible approach to rough diamond sales.
This week the company said that the impact of Covid-19 has accelerated the transformation that was already underway across the industry and which is expected to continue at pace.
“This includes more efficient inventory management, increased online purchasing, and a growing consumer desire for products with demonstrable ethical and sustainability credentials, including an enhanced appreciation for the natural world”, reads part of the notes accompanying.
On Thursday, Anglo American which owns 85 percent of De Beers released its financials for the year ended December 2020, giving an insight on how the world’s top diamond producer by value was hampered by the pandemic.
“The pandemic also had a major impact on the diamond industry, driving a 45 percent decrease in rough diamond sales volumes at De Beers in the first half of the year, followed by significant improvement in the second half, as lockdown restrictions eased in many countries, resulting in an overall 27 percent decrease in rough diamond sales volumes for the year,” Anglo American disclosed in the financials.
De Beers’ rough diamond production decreased by 18 percent to 25.1 million carats last year compared to 2019’s 30.8 million carats, in response to lower demand due to the pandemic and Covid-19 restrictions in southern Africa during the first half of the year.
In Botswana, where the company sources nearly 70 percent of rough diamonds, production decreased by 29 percent to 16.6 million carats, with volumes at Jwaneng reduced by 40 percent to 7.5 million carats, while production at Orapa decreased by 16 percent to 9 million carats. This was largely due to a nationwide lockdown from 2 April to 18 May, and the planned treatment of lower grade material at both Jwaneng and Orapa, following their restart, as a production response to lower demand.