Orapa region mines pick De Beers’ output

Planned production increase at Debswana’s mines in the Orapa region - Orapa, Letlhakane and Damtshaa has pushed up De Beers’ rough diamonds output for the last quarter of 2018, the group’s latest report has indicated. De Beers’ latest production report shows that rough diamond production increased 12 percent to 9.1 million carats in the last quarter of 2018. The increase is compared to 8.6 million carats recorded in the third quarter and 8.9 million carats in the second and 8.4 million carats in the first quarter. Despite the good performances by Orapa mines, De Beers missed its production target of 35 to 36 million carats for 2018, as the total production for the year landed at 35.3 million carats. Other mines that contributed to production include Jwaneng, Namibia’s Namdeb Holdings, South Africa’s De Beers consolidated mines and Canada’s Gahcho Kué. On the other hand, the full year rough diamond sales volumes were four per cent lower at 33.7 million carats compared with 35.1 million carats in 2017.Meanwhile, the 2019 production guidance for De Beers is 31 to 33 million carats, subject to trading conditions. “The lower production is driven by the process of exiting from the Venetia open pit with the underground becoming the principal source of ore from 2023. “Associated with this, an increased proportion of production in 2019 is expected to come from De Beers Group’s joint venture partners, a proportion of which only generate a trading margin, which is lower than the mining margin generated from own mined production,” said De Beers’ latest production report. Meanwhile, local analyst Econsult’s economic review for the fourth quarter 2018 has observed that the global diamond market has been performing reasonably well in overall terms, but with stress in particular segments that may reflect structural change and potential volatility going forward. Econsult however bemoaned that the price increase for rough diamond has squeezed profit margins for dealers and cutters, as polished prices have not increased commensurately. “The problem has been particularly acute for small, low value diamonds, perhaps due in part to pressure from increasing supplies of synthetic diamonds,” said Econsult.