COMMUS, based near Congo's southern city of Kolwezi, produced 129 000 tonnes of copper and about 2 200 tons of cobalt last year.

Lisa Steyn - Anglo American has slashed its annual diamond production forecast by about 10% as its De Beers subsidiary reins in gem production in response to higher than average inventory levels in the world market.

The diversified mining group reported a 23% drop in rough diamond production to 6.9 million carats for the first quarter of 2024.

This, Anglo said, was "primarily due to changes implemented to lower production in response to market inventory levels".

Full year 2024 production guidance has been lowered to between 26 and 29 million carats, down from 29 to 32 million carats previously.

"Production is lowered in response to the higher than average levels of inventory in the market and the expected gradual recovery in rough diamonds through the rest of the year," Anglo said in a production update yesterday.



Drop

Production levels dropped most significantly in Botswana, driven by intentional lower production at the Jwaneng operation.

The decline in South Africa was also notable. This was due to the continued depletion of lower grade surface stockpiles ahead of a planned ramp-up of underground operations at the flagship Venetia mine over the next few years.

The unit cost, which is based on De Beers' share of production volume has been adjusted accordingly to US$90 per carat, up from US$80 previously.

Last week, De Beers reported an increase in rough diamond sales of US$445 million (about N$8.5 billion) in its third sales cycle – up from US$431 million in the previous cycle, but still down almost 18% year-on-year.

The recovery in the first quarter followed improved demand for diamond jewellery in the United States over the year-end holiday season.

But the second quarter of the year is usually a slow period for rough diamond demand and ongoing uncertainty around economic growth prospects – and in particular the slow pace of growth in China – has led to a continued cautious purchasing approach by customers.



Recovery

Anglo said it expects the recovery in rough diamond demand to be gradual through the rest of the year.

In February, Anglo American announced a US$1.6 billion (N$30.7 billion) impairment of De Beers, leaving the group's 85% stake in the diamond producer with a still-rather-generous carrying value of about US$7 billion.

The group has plans to further tighten up its balance sheet with some R20 billion in annual cost cuts mainly aimed at the Anglo American Platinum and Kumba Iron Ore businesses.

But amid questions in some quarters about the producer, Anglo CEO Duncan Wanblad has said every asset in the portfolio would have to justify its place in the group. He has, however, spoken about De Beers favourably, describing the business as "very strong". – Fin24