The Venetia underground mine
Global miner De Beers' rough diamond production decreased by 5% year-on-year to 7.6-million carats in the second quarter as a result of the planned reduction in South Africa while the Venetia openpit transitions to underground operations.
Production in South Africa decreased by 62% to 466 000 ct, compared with the 1.22-million carats produced in the second quarter of 2022.
Venetia continues to process lower-grade surface stockpiles, which will result in temporary lower production levels as it transitions to underground operations, De Beers points out.
Meanwhile, rough diamond production in Botswana increased by 6% year-on-year to 5.8-million carats, driven by the planned treatment of higher-grade ore at Orapa, but partially offset by lower throughput at Jwaneng owing to planned maintenance.
Production in Namibia also increased, by 8% year-on-year to 612 000 ct, primarily driven by the ongoing ramp-up and expansion of the mining area at the land operations.
Production in Canada increased by 6% to 683 000 ct, driven by the treatment of higher-grade ore, despite planned plant maintenance.
Despite the lower second-quarter production, De Beers expects to meet its full-year production guidance of 30-million to 33-million carats.
It notes, however, that demand for rough diamonds has been impacted by the ongoing macroeconomic headwinds.
As a result, it sold 7.6-million of rough diamonds from two sightholder (sights) sales, compared with the 9.4-million carats sold during three sights in the second quarter of 2022.
This is also lower than the 9.7-million carats sold during three sights in the first quarter of this year.
De Beers notes that the average realised price for the first six months of this year was $163/ct – a 23% decrease on the average price of $213/ct achieved in the first half of 2022.
It attributes this to sightholders taking a more cautious approach to planning their 2023 allocation schedule owing to the uncertain macroeconomic outlook.
"The average rough price index decreased by 2%, reflecting the overall softening in consumer demand for diamond jewellery and a build-up of inventory in the midstream," it says.