De Beers Posts 12% Jump in Output For 2013

The firm saw improvements in all regions, especially in Botswana and Canada.

De Beers’ production last year rose 12 percent to 31.2 million carats from 27.9 million carats in 2012.
 
Sales rose only marginally to $6.4 billion in 2013 from $6.1 billion in 2012.

"De Beers’ rough diamond price index has increased 2 percent since the start of the year, while average realized rough diamond prices were 5 percent higher, driven by the product mix.

"Production increased by 12 percent to 31.2 million carats, largely owing to the full restoration of operations at Jwaneng in the third quarter following the slope failure incident in June 2012. Production from Canada also increased owing to further increases in mining volumes and improved grades at Snap Lake.

The firm said that in spite global economic uncertainty, diamond jewelry sales rose in local currency terms in all major diamond markets, apart from India.

"In India, challenging economic conditions and a devaluation of the rupee resulted in a decline in demand. The US market posted positive growth, with a generally strong holiday season in the fourth quarter. China continued to show positive growth rates, but at levels consistent with slower economic development.

"Although the De Beers rough price index increased slightly in the first half, a combination of weaker polished prices, high levels of stock in the cutting centers and tightening liquidity resulted in some of this increase being reversed in the second half. The price decrease, together with an increase in polished sales, saw the rough market stabilize and start to improve toward the end of the year.

De Beers expects a "slight strengthening in growth in diamond jewelry demand in 2014, driven by continued gradual improvements in the global economic outlook. The US and China are expected to continue to be the main engines of growth for polished diamonds, while most other markets are expected to show positive growth in local currency, with final dollar denominated results being partly dependent on currency fluctuations.

"Rough diamond manufacturers, in India in particular, face continued pressures regarding levels of bank financing. In India, further volatility of the rupee may potentially affect rough diamond sales. In the medium to long term, industry fundamentals are expected to strengthen as diamond production plateaus and demand continues to increase."