DeBeers – Page 2 – The Diamond Certification Laboratory of Australia (DCLA)

Chinese retailers are offloading polished diamonds as demand tanks, adding to a $2 billion inventory headache for De Beers

Anglo American’s troubled ownership of the De Beers group was brought into fresh focus on Thursday as the mining company announced a fresh multibillion-dollar write-down of the diamond group it’s trying to restructure.

De Beers, which nearly 80 years ago introduced the masses to the immortal phrase “A diamond is forever,” has lost its shine in recent years amid declining demand for diamonds, partly a result of the growth of cheaper, allegedly more sustainable lab-grown alternatives, and also from declining demand in its crucial Chinese market.

Anglo announced a $2.9 billion write-down in the value of De Beers as part of its 2024 annual results on Thursday. It was the second valuation reduction in two years, after a $1.6 billion write-down in its 2023 earnings.

De Beers now has a book value of around $4 billion, meaning the company has more than halved from a 2023 valuation of $8.5 billion. The current valuation includes a $2 billion stockpile of diamonds it has struggled to shift amid the downturn in the industry.

“It’s been a bad year for rough diamond sales,” De Beers CEO Al Cook told the FT in December.

Lab-grown diamonds and Chinese issues
Duncan Wanblad, Anglo’s CEO, described the 2024 trading conditions for rough diamonds as “extremely challenging,” citing high midstream inventory levels and depressed demand in China for a steep drop in sales in the second half of the year. Anglo expects to remove 10 million carats from planned production this year, after removing 6 million in 2024.

De Beers has faced an identity crisis amid a drop-off in demand for authentic diamonds. That has partly been driven by brewing demand for lab-grown diamonds.

The group entered the lab-grown business in 2018, aiming for sustainability-minded customers. However, that proposition aligned with their relative affordability has caused the product to cannibalize some of De Beers’ customers, and it exited that market in 2024.

Wanblad said the lab-grown headwinds were surmountable. John Heasely, Anglo American’s finance director, suggested the expected continued decline in prices for lab-grown diamonds would continue to bifurcate the two markets, reducing the chance of lab-grown diamonds cannibalizing the genuine market.

In China, which has reduced the cumulative demand for diamonds by 40% in the last two years, Heasley noted changing behavior among retailers was adding to its inventory headaches.

The finance director said retailers in the country had started selling their polished diamonds back into the midstream market to recoup some of their expenditure. This led midstream inventories to spike in the first half of 2024, keeping the company’s rough diamond inventory fixed.

Anglo restructures De Beers
Anglo has sought to restructure De Beers into an independent operation, which could result in either a sale or an IPO of the diamond company.

However, this restructuring has been delayed owing to myriad industrial headwinds the company has faced.

Wanblad said of De Beers: “I’m really not expecting much traction or progress in the first half of this year.”

Wanblad says it has agreed a framework with the Botswana government, which is a 15% owner in De Beers, to help it potentially initiate a formal sale process after receiving several “unsolicited inbounds” for the diamond company.

Source: Fortune

Duffy resigns as Petra CEO, interim revenue knocked by market weakness

Independent mining group Petra Diamonds, which owns and operates diamond mines in South Africa, has appointed two interim CEOs Vivek Gadodia and Juan Kemp to succeed Richard Duffy, who has resigned by mutual agreement and with immediate effect.

Gadodia will oversee all corporate matters of the group, while Kemp will oversee all operational matters.

At this point, they will not be appointed as directors.

Vivek joined Petra in 2021 with his roles having included planning and corporate planning executive and chief restructuring officer. He previously worked for Sasol in various engineering, project management and corporate positions over a 15-year period.

Kemp, meanwhile, joined Petra in 2009 when the company bought its flagship Cullinan mine from fellow miner De Beers.

Kemp was GM of the mine since 2011 before having been appointed as a chief technical officer in 2019 and operations executive for the Cullinan mine in 2024.

His earlier career included positions at De Beers and AngloGold Ashanti.

The appointments of the interim CEOs come as Petra struggles with lower earnings generation and high debt.

The company’s results for the six months ended December 31, 2024, reflect Petra’s progress in implementing cost reduction plans and smoothed capital profiles, despite weakness in the diamond market.

Petra managed to reduce its mining and processing costs from continuing operations by 19% year-on-year to $98-million.

However, the group’s revenue was also lower by 30% year-on-year, or $49-million, at $115-million owing to additional revenue of $50-million having been carried over from tenders into the prior comparable period.

Adjusted earnings before interest, taxes, depreciation and amortisation amounted to $15-million, which was lower than the $38-million adjusted Ebitda reported in the first half of the prior financial year.

The company’s basic loss a share from continuing operations was $0.30, or $0.13 on an adjusted basis.

Operational free cash inflow of $16-million in the six months under review compares with a $21-million outflow in the first half of the prior year, which Petra says largely reflects the impact of its cost reduction measures, capital smoothing and working capital management.

The lower revenue and earnings over the financial year of 2024, caused Petra to not meet its required leverage and interest cover covenant ratios in its revolving credit facility measured at December 31, 2024.

Petra has since obtained a waiver from the lender, Absa Bank, related to these covenant breaches, and is restarting engagements with lenders regarding the refinancing of its debt.

The group’s consolidated net debt was $215-million as at December 31, compared with $193-million at the end of June, owing to diamond market weakness and the timing of Petra’s tender sales.

Three tender sales took place during the first half of the 2025 financial year (the six months ended December 31), while four have been scheduled for the remainder of the financial year.

Petra realised an average price of $103/ct in the reporting period, which reflects the positive impact of product mix over the period offsetting the overall weaker diamond pricing environment.

OPERATIONS

The group has achieved cost reductions through sustainably lowering overheads and on-mine cost optimisation with limited impact to its operations.

Petra completed the sale of its interest in the Koffiefontein mine to the Stargems Group in the six months under review, which allowed the group to avoid closure-related costs of $23-million.

Petra also entered into an agreement in January to sell its interest in the Williamson mine, in Tanzania, to Pink Diamonds Investments for a headline consideration of $16-million.

The group expects the sale of its interest in the Williamson mine to be completed by the end of the calendar year.

The Finsch mine has transitioned into new production areas called 78-Level Phase 2, with steady operations having been reported over the past few months.

In turn, production from the CC1E zone at the Cullinan mine has also started in the interim period, while Petra continues to advance more extension projects at both of these mines, as well as life-of-mine plan reviews.

Petra intends to re-engage its lenders with a revised business plan and updated cost-savings initiatives, as part of its overall restructuring plan.

The group is targeting net free cashflow generation for the remainder of the financial year, as well as more efforts to make the company resilient to pricing weakness.

Source: Chanel de Bruyn

Botswana’s central bank left its main lending rate

Botswana’s central bank left its main lending rate unchanged on Thursday, saying the economy was expected to operate below capacity and not generate demand-driven inflationary pressures because of a slump in the global diamond market.

The Bank of Botswana held its Monetary Policy Rate at 1.90% for the second policy meeting in a row. The rate is based on a seven-day instrument.

“The economy will contract this year primarily due to the downturn in the global diamond market and moderately recover next year,” central bank Governor Cornelius Dekop told a news conference.

The southern African country’s economy is largely dependent on the export of diamonds, and declining earnings from the precious stone have limited government spending.

The central bank also lowered its primary reserve requirement to 0% from 2.5% due to significantly reduced liquidity in the banking system.

Dekop said inflation was expected to average 2.9% in 2024 and 3.3% in 2025, compared with forecasts of 2.8% and 3.1% given at the bank’s previous monetary policy meeting in November.

The Bank of Botswana prefers inflation between 3% and 6% over the medium term. Annual inflation stood at 1.6% in October.

Source: Mining.com

Average US Engagement Ring Costs $6,750

Young bride wearing beautiful engagement ring, closeup

The average price of a natural diamond engagement ring in the US last year was $6,750.

And the average size of the stone was 1.07 carats, according to a new report by the New York-based Natural Diamond Council.

It provides a detailed analysis of the shift to larger, higher quality diamonds in its downloadable 20-page Natural Diamond Trends: A 2024 Overview.

Round brilliants remain by far the most popular shapes in diamond jewelry, at 81.7 per cent, but that figure is slipping slightly.

Among fancy shapes for all diamond jewelry, princess and cushion showed the biggest increases, albeit from a very low base (2.1 per cent and 1.0 per cent market share respectively).

The most common color for an engagement diamond was H and the most common clarity was SI1, with bridal representing 33 per cent of all natural diamond sales in the US.

The average price of wedding sets increased 31 per cent in 2024, the report said.

“The increase was mainly due to a rise in the average size of diamonds and a notable change in the type of metal used.”

The average price of natural diamond jewelry sold across all product categories grew 2.7% to $2,360 in 2024.

The report, the latest in a series uncovering the trends, origins and impacts of natural diamonds, was jointly produced with Tenoris.

Source: IDEX

Lab-Grown Diamonds: A Game Changer in the Diamond Industry

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Whether you are buying a natural or lab-grown diamond

The diamond industry is undergoing a seismic shift, driven by the rising popularity of lab-grown diamonds. Once considered a niche alternative, these scientifically engineered gems are now mainstream, offering a more affordable and ethically sourced option compared to their natural counterparts. This surge in demand is putting pressure on the traditional diamond market, challenging industry norms and reshaping consumer preferences.

Lab-grown gems putting pressure on the diamond industry

Lab-Grown Diamonds and Their Impact on the Industry

Lab-grown diamonds are chemically, physically, and optically identical to natural diamonds. They are created using advanced technological processes that replicate the conditions under which diamonds form in the Earth’s mantle. As a result, they offer the same brilliance, hardness, and durability as mined diamonds, but at a significantly lower price point.

With consumers becoming more conscious of sustainability and ethical sourcing, lab-grown diamonds are increasingly seen as a viable alternative to mined stones. This shift in preference is sending shock waves through the traditional precious gems market, compelling industry players to adapt to evolving trends.

Why You Need Expert Guidance When Buying Diamonds

While lab-grown diamonds present an attractive option, navigating the diamond market—whether natural or lab-created—requires expert guidance. With the influx of synthetic diamonds, ensuring that you are purchasing a high-quality stone from a reputable source is crucial. This is where independent diamond certification becomes essential.

DCLA: Sydney’s Most Trusted Diamond Laboratory

When it comes to protecting your investment and ensuring the authenticity of your diamond, the Diamond Certification Laboratory of Australia (DCLA) in Sydney is the best option. DCLA is one of the only internationally recognised and independent diamond grading laboratories in the world, adhering to strict grading standards to provide unbiased, accurate diamond certification.

Botswana Forecasts 2025 Diamond Recovery

Botswana’s government is forecasting a recovery in the diamond market later this year, and a consequent expansion of the country’s economy.

It shrank by 3.1 per cent in 2024, but according to vice president and finance minister Ndaba Gaolathe it is now expected to grow 3.3 per cent in 2025.

“This growth outlook is premised on recovery of the diamond industry, which is expected in the latter part of 2025, and continued positive sentiment in the non-diamond mining sectors,” he said yesterday (10 February) in his budget speech for 2025/26.

Diamonds account for around 80 per cent of Botswana’s export earnings and a third of total budget revenues.

De Beers and the Botswana government have finally reached agreement on the long-term mining and rough sales deals.

But their joint venture Debswana reported sales for the first three quarters of 2024 were down by 52 per cent.

In December, Gaolathe warned that Botswana’s economy could contract by 1.7 per cent during 2024 as a direct result of the diamond.
Slump.

But he predicted better times ahead, with an expected rebound in the diamond market driving overall growth in 2025.

Video grab shows finance minister Ndaba Gaolathe delivering his 2025/26 budget.

Source: IDEX

De Beers Adapts to India’s Growing Demand for Lab-Grown Diamonds

De Beers, long associated with the glamour of natural diamonds, is now grappling with a fading shine. The rise of lab-grown diamonds, which have gained popularity among millennial and Gen Z consumers in India and worldwide from the US to China poses a significant challenge.

Lab-grown diamonds offer several advantages: they are 60-75% more affordable than natural diamonds, and as mass production increases, prices continue to drop. Moreover, they share the same chemical composition as natural diamonds and are visually indistinguishable to the naked eye.

US Diamond Importers Must Declare Country of Origin

New rules announced by US Customs and Border Protection (CBP) will require all diamond importers to declare the country of origin of all goods.

The move, to be implemented in April, is aimed at enforcing sanctions on Russian diamonds.

Importers have been required, since last March, to certify that their goods are not Russian, but not to disclose where they are from.

The G7 nations – including the US and EU – imposed a ban on Russian diamonds of 1 carat or more from March 2024 and on goods of 0.5 carats or above from September 2024.

Despite the sanctions, Russia is still thought to be exporting 40 per cent of its diamonds output because they are below the size threshold or industrial quality.

The US Customs and Border Protection (CBP) said in a statement that it plans to start collecting additional data in April on jewelry imports (and seafood) requiring filers to provide the country of mining.

They’ll be required to upload a PDF document on official company letterhead to CBP’s automated commercial environment (ACE) document image system.

The requirement applies to both loose diamonds and jewelry containing diamonds. Jewelry imports without diamonds are exempt.

The carat size threshold is not mentioned in the CBP announcement.

Source: IDEX

Anglo American to review De Beers value amid weak diamond demand

Anglo American expects its De Beers diamond business to record an impairment amid declining diamond sales.

The London-listed miner announced Thursday that it will review De Beers’ value as it looks to exit the business, citing persistently weak diamond demand. Last year, Anglo reduced De Beers’ book value by $1.6 billion to $7.6 billion.

De Beers rough diamond production decreased by 26% to 5.8 million carats in 2024, compared to the previous year. The 2025 production guidance has been revised to 20–23 million carats, down from the previous estimate of 30–33 million carats. Anglo anticipates a marginal loss for the diamond business in 2024.

The mining giant put the world’s largest diamond producer up for sale last year as part of its portfolio simplification following a tentative takeover bid from BHP (ASX: BHP).

Anglo chief executive officer Duncan Wanblad stated earlier this week that the company plans to exit De Beers by the end of the year.

In November, Anglo announced agreements to sell its steelmaking coal business for up to $4.9 billion, with the Peabody transaction expected to close by the third quarter of 2025.

Additionally, the company completed a second bookbuild offering of Anglo American Platinum shares.

2024 production
On Thursday, the company reported that all of its businesses met their full-year production guidance.

It produced 773 kt of copper in 2024, aligning with its 730-790 kt guidance range, with the Quellaveco mine in Peru achieving its strongest quarter of the year in Q4.

“Our forward production guidance is unchanged in copper with growth in 2026 driven by higher grades in Chile, with this production level then maintained in 2027,” said Wanblad.

“We continue to set up the copper business for growth in subsequent years with the resumption of the smaller plant at Los Bronces and through debottlenecking at Collahuasi,” he said.

Anglo’s Minas-Rio iron ore operation in Brazil set a record, producing 25 million tonnes for the year, contributing to the company’s total iron ore production of 60.8 million tonnes in 2024.

“The key focus for the market has been on copper and production came ahead of expectations, with a strong result from Los Bronces, and guidance for FY25 remains unchanged,” RBC Capital Markets analysts commented in a note.

“However, not much good news beyond that with weak realised pricing in both iron ore and copper.”

Anglo American shares rose more than 5% in London trading following the results. The company has a market cap of £32.9 billion ($40.9 billion).

Source: Mining.com

Indian Govt. Advocates for Direct Diamond Trade at Mining Indaba 2025

The Indian delegation expressed optimism about overcoming logistical and regulatory challenges, ensuring a streamlined process that benefits all stakeholders.

A high-profile Indian delegation led by Shri R. Arulanandan, Director, Department of Commerce, Government of India actively participated in the “Opportunities in India” event, hosted by the Consulate General of India in Cape Town and the Government of India. The event was held on the sidelines of the prestigious Mining Indaba 2025.

The delegation, which included Shri Rajat Wani, Regional Director – Surat, GJEPC, highlighted the potential of Special Notified Zones (SNZs) for diamonds in Mumbai and Surat, focusing on their role in simplifying trade processes. Stressing the need to reduce the number of intermediaries in the diamond value chain, they underscored the importance of facilitating more direct trade of rough diamonds between India and African mining nations.

Direct auctioning of diamonds in SNZs was presented as a mutually beneficial strategy. Such a framework would enable African mining countries to secure higher returns on their diamond exports while allowing Indian buyers greater access to competitively priced rough diamonds.

The discussions also explored the necessity of consignment exports, a move that could align with African nations’ policies, such as “temporary export” mechanisms. The Indian delegation expressed optimism about overcoming logistical and regulatory challenges, ensuring a streamlined process that benefits all stakeholders.

Source: Gjepc.org