The half-year figures for De Beers and Alrosa showed declines in sales and production.
De Beers, the world’s largest diamond producer with close to 40 percent of global production, lowered its 2015 output target for the second time this year as demand for the gems continues to decrease .
De Beers announced in its half-year financial results on July 24 that it is cutting its full-year goal to 29 million to 31 million carats from an earlier target of 30 million to 32 million carats. At the start of the year, the Anglo American Plc unit was planning to mine as much as 34 million carats .
" We think it is adequate,” said De Beers Chief Executive Officer Philippe Mellier, commenting on the new target. He told investors on Friday that he expects the market to be “stable” in dollar terms compared with last year .
De Beers and other diamond producers are under pressure to cut supply and lower prices as traders, cutters and polishers struggle to turn a profit amid a squeeze on credit and as jewelry sales languish. Buyers in India, where almost 90 percent of stones are cut and polished, threatened to ban imports this month amid complaints about a supply glut .
"It’s been a tough couple of months,” Anglo CEO Mark Cutifani told investors. “The market is currently tightening up. We’ve seen a flattening of demand .”
De Beers reported first-half sales of $3.02 billion after mining 15.6 million carats. De Beers contributed $360 million of underlying earnings to Anglo American, more than a third of the mining company’s profit .
"Clearly the second half is going to be a tougher period,” Cutifani said .
Meanwhile, Alrosa generated $2.1 billion from the sale of 18 million carats of rough diamonds in the first half of this year, a 22 percent drop from last year.
The Russian diamond mining firm confirmed an ongoing slowdown in global diamond markets in the second calendar quarter.
By contrast, the miner sold 21.1 million carats of diamonds that brought in $2.7 billion in the first six months of 2014.
Alrosa’s rough prices slipped by 3 percent during the second quarter and by 6 percent in the first half of the year.
It sold 5.4 million carats of gem-quality diamonds at an average price per carat of $176 in the second quarter, and 3.4 million carats of industrial diamonds at an average price per carat of $11.
Output in the second quarter of this year soared 20 percent on the year to 9.6 million carats, while production in the first half rose by 13 percent to 18 million carats.
In other highlights for the six-month period, the average grade achieved improved to 1.11 carats per tonne from 1.02 carats per tonne a year earlier; the company processed extra stockpiles of higher grade ore from the open pit Udachnaya pipe; production at the Mir underground mine almost doubled due to measures to reduce water inflow; and the first 481,000 carats were recovered from the Botuobinskaya pipe following its launch in March 2015.
