Less shiny half-year for Namdeb
Debmarine remains backbone
Anglo American says it is actively assessing options with its partners to further reduce production to manage working capital and preserve cash.
Namdeb produced 1.194 million carats of diamonds in the first six months of this year, 37 000 carats or 3% less than the same half-year in 2023.
According to Anglo American’s second-quarter production report released yesterday, Debmarine Namibia contributed about 78% to production locally: the marine giant contributed 932 000 carats, while Namdeb’s land operations were responsible for 262 000 carats.
In the past quarter, planned vessel maintenance at Debmarine Namibia resulted in decreased production, Anglo said. This was partially offset by planned mining of higher grade areas at Namdeb, the group added.
In total, Namdeb produced 561 000 carats in the past quarter.
Anglo owns De Beers, who has a stake of 50% in Namdeb. The Namibian government owns the other half.
Performance
Overall, Anglo’s overall rough diamond production decreased by 15% to 6.4 million carats.
According to Anglo, this primarily reflects the lower production guidance announced in the first quarter production report in response to the higher-than-normal levels of inventory in the midstream, as well as the expectation for a protracted recovery in demand.
In Botswana, production decreased by 19% to 4.7 million carats in the past quarter.
This was driven by intentional lower production from short-term changes in plant feed mix at Jwaneng to process existing surface stockpiles. Production at Orapa was broadly flat.
In South Africa, production increased by 8% to 0.5 million carats.
The increase reflects the benefit of processing increased volumes of higher-grade underground ore as the Venetia mine transitions underground.
Production in Canada was broadly unchanged at 0.7 million carats.
Demand
According to Anglo, demand for rough diamonds recovered slightly at the start of this year following the cessation of the voluntary moratorium on rough diamond imports into India in late 2023.
Improved demand for diamond jewellery in the United States year-end retail selling season also boosted demand.
“However, with midstream polished inventories remaining higher than normal and continued cautious restocking from retailers, demand for rough diamonds deteriorated in the second quarter of the year,” Anglo said.
“Market conditions are expected to reflect a protracted recovery in demand,” it added.
Sales
Rough diamond sales in the past quarter totalled 7.8 million carats (7.3 million carats on a consolidated basis) from three sights, compared with 7.6 million carats (6.4 million carats on a consolidated basis) from two sights in the corresponding quarter in 2023.
In the first quarter of this year, 4.9 million carats (4.6 million carats on a consolidated basis) were sold from two sights.
The consolidated average realised price in the first half of this year remained broadly flat at US$164/ct (H1 2023: $163/ct).
This reflects a larger proportion of higher-value rough diamonds being sold, offset by a 20% decrease in the average rough price index compared to the corresponding six months in 2023, Anglo said.
The group left its production guidance for the year unchanged at 26 to 29 million carats. “However, with higher than normal levels of inventory remaining in the midstream and an expectation for a protracted recovery, we are actively assessing options with our partners to further reduce production to manage our working capital and preserve cash,” Anglo said.
According to Anglo American’s second-quarter production report released yesterday, Debmarine Namibia contributed about 78% to production locally: the marine giant contributed 932 000 carats, while Namdeb’s land operations were responsible for 262 000 carats.
In the past quarter, planned vessel maintenance at Debmarine Namibia resulted in decreased production, Anglo said. This was partially offset by planned mining of higher grade areas at Namdeb, the group added.
In total, Namdeb produced 561 000 carats in the past quarter.
Anglo owns De Beers, who has a stake of 50% in Namdeb. The Namibian government owns the other half.
Performance
Overall, Anglo’s overall rough diamond production decreased by 15% to 6.4 million carats.
According to Anglo, this primarily reflects the lower production guidance announced in the first quarter production report in response to the higher-than-normal levels of inventory in the midstream, as well as the expectation for a protracted recovery in demand.
In Botswana, production decreased by 19% to 4.7 million carats in the past quarter.
This was driven by intentional lower production from short-term changes in plant feed mix at Jwaneng to process existing surface stockpiles. Production at Orapa was broadly flat.
In South Africa, production increased by 8% to 0.5 million carats.
The increase reflects the benefit of processing increased volumes of higher-grade underground ore as the Venetia mine transitions underground.
Production in Canada was broadly unchanged at 0.7 million carats.
Demand
According to Anglo, demand for rough diamonds recovered slightly at the start of this year following the cessation of the voluntary moratorium on rough diamond imports into India in late 2023.
Improved demand for diamond jewellery in the United States year-end retail selling season also boosted demand.
“However, with midstream polished inventories remaining higher than normal and continued cautious restocking from retailers, demand for rough diamonds deteriorated in the second quarter of the year,” Anglo said.
“Market conditions are expected to reflect a protracted recovery in demand,” it added.
Sales
Rough diamond sales in the past quarter totalled 7.8 million carats (7.3 million carats on a consolidated basis) from three sights, compared with 7.6 million carats (6.4 million carats on a consolidated basis) from two sights in the corresponding quarter in 2023.
In the first quarter of this year, 4.9 million carats (4.6 million carats on a consolidated basis) were sold from two sights.
The consolidated average realised price in the first half of this year remained broadly flat at US$164/ct (H1 2023: $163/ct).
This reflects a larger proportion of higher-value rough diamonds being sold, offset by a 20% decrease in the average rough price index compared to the corresponding six months in 2023, Anglo said.
The group left its production guidance for the year unchanged at 26 to 29 million carats. “However, with higher than normal levels of inventory remaining in the midstream and an expectation for a protracted recovery, we are actively assessing options with our partners to further reduce production to manage our working capital and preserve cash,” Anglo said.
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