Diamond production took a significant hit in the first quarter for De Beers Group, with a 23 percent drop leading to the company revising its guidance for the year. The decline in production was experienced across all countries where De Beers mines diamonds, except for Namibia.
In Botswana, the largest contributor to De Beers’ output, production fell to 5 million carats in the first quarter, down 28 percent from the previous year. Operations at the Jwaneng mine were intentionally reduced due to market conditions, while focus shifted to processing existing surface stockpiles at Orapa.
South Africa also saw a significant decrease in production, falling 19 percent year-over-year. The company continues to mine lower-grade surface stockpiles while preparing for the transition to underground production at the Venetia mine, its last remaining operation in the country.
Despite the challenges in production, De Beers reported an increase in the average realized price of rough diamonds, up 23 percent to $201 per carat. This rise was attributed to a shift towards higher-value rough diamonds in the sales mix, as well as dropping prices to stimulate demand for more expensive goods.
Looking ahead, De Beers expects a gradual recovery in rough diamond sales for the remainder of the year. The company has adjusted its production guidance for 2024 to 26-29 million carats, down from the initial estimate of 29-32 million carats. Amidst continued oversupply in the market and a sluggish rough diamond market, De Beers remains cautiously optimistic about the future of diamond production and sales.
