Diamond miner De Beers reported a 54% year-on-year decrease in production to 3.5-million carats in the second quarter of the year.

This was owing to the Covid-19 lockdown measures in South Africa, Namibia, Botswana and Canada where the miner operates.

The miner noted that even when operations were allowed to resume, demand for rough diamonds globally remained weak.

In Botswana, production decreased by 68% year-on-year to 1.8-million carats, principally owing to a nationwide lockdown from April 2 to May 18 and the implementation of Covid-19 measures to safeguard the workforce.

Operations restarted from mid-May, with production targeted at levels to meet the lower demand.

The company’s production in Namibia increased by 7% year-on-year to 400 000 ct. De Beers explains that notwithstanding targeted regional lockdowns in Namibia in response to Covid-19, the company’s marine operations was able to implement measures to enable operational continuity while safeguarding the workforce.

This more than offset the decrease in production from Covid-19 at the land-based operations.

South African production decreased by 3% year-on-year to 600 000 ct, mainly owing to Covid-19 measures. The production shutdown was partly offset by higher grades from the openpit material prior to the underground transition of the Venetia mine. 

The company’s treatment plant in South Africa could restart in mid-April and ramped up to normal capacity by the end of April.

Production in Canada decreased by 27% to 800 000 ct, mainly owing to the Victor mine having the end of its life in the second quarter of last year.

At the company’s Gahcho Kué joint venture mine, production decreased by 11% to 800 000 ct, owing to Covid-19 measures.

De Beers commented on July 16 that, during the second quarter, demand for rough diamonds was significantly impacted by a combination of Covid-19 restrictions impacting consumer demand and access to Southern Africa, as well as severely limited midstream cutting and polishing capacity owing to lockdowns, particularly in India.

Rough diamond sales for the quarter totalled 300 000 ct, or 200 000 ct on a consolidated basis, compared with nine-million carats in the second quarter of last year, or 8.3-million carats on a consolidated basis.

Therefore, rough diamond consolidated sales in the quarter under review decreased to $56-million, compared with $1.3-billion of consolidated sales reported in the prior corresponding quarter – driven by lower volume and prices.

The company’s consolidated sales volumes exclude De Beers’ joint venture partners’ 50% proportionate share of sales to entities outside the De Beers group from Diamond Trading Company Botswana and the Namibia Diamond Trading Company, which are included in total sales volumes.

The average realised rough diamond price during the first half of the year was $119/ct, which is 21% lower year-on-year.

De Beers maintains its production guidance at between 25-million and 27-million carats, subject to continuous review based on the disruptions related to Covid-19 and the timing and scale of the recovery in demand.

NEW CFO

Meanwhile, De Beers has appointed Sarah Kuijlaars CFO, effective September 1.

She previously served as CFO of global design and engineering consultancy Arcadis and deputy CFO at Rolls Royce Holdings.

Kuijlaars also held senior financial leadership roles during her 25-year career at Royal Dutch Shell.

She is currently a nonexecutive director at Aggreko, an international provider of mobile modular power, temperature control and energy services.

Kuijlaars succeeds Nimesh Patel, who resigned on April 2 and will leave the group on July 26.