De Beers lifts first-quarter production by 25% y/y

Diamond miner De Beers increased its total rough diamond production by 25% year-on-year to 8.9-million carats in the first quarter of this year, reflecting an improved operational performance and higher planned levels of production to meet continued strong demand for rough diamonds.

However, the miner’s operations in Botswana and its Venetia mine, in South Africa, were negatively impacted on by high rainfall in the period.

De Beers’ South African production increased by 46% to 1.7-million carats owing to the treatment of higher-grade ore from the final cut of the openpit.

In Botswana, production increased by 25% to 6.2-million carats as a result of increased processing at both Orapa and Jwaneng, as well as planned higher grades across the operations.

Production at the Namibian operations increased by 33% to 500 000 ct, primarily driven by higher recovery from marine crawler vessels, owing to lower planned maintenance of the vessel Mafuta and the early delivery of the new diamond recovery vessel the Benguela Gem.

Production in Canada decreased by 15% to 600 000 ct, primarily as a result of treating lower-grade ore.

De Beers notes that “robust” demand for rough diamonds continued into the first quarter of this year, following strong growth in consumer demand over the December holiday season, with rough diamond sales totalling 7.9-million carats (7-million carats on a consolidated basis) from two sightholder sales events.

This is compared with 13.5-million carats (12.7-million carats on a consolidated basis) from three sightholder sales events in the first quarter of 2021, and 7.7-million carats (7.2-million carats on a consolidated basis) from three sightholder sales in the fourth quarter of 2021.

However, De Beers notes that, as the diamond industry heads into the seasonally slower second quarter of the year, diamond businesses are adopting a more cautious and watchful approach in light of the war in Ukraine and associated sanctions, as well as the impact of Covid-19 lockdowns in China.

Nonetheless, De Beers is maintaining its full-year production guidance at between 30-million and 33-million carats, subject to trading conditions and the extent of further Covid-19 related disruptions. Unit cost guidance for the full-year is also unchanged at $65/ct.