Anglo American is assessing options with its partners to further reduce De Beers’ diamond production to manage working capital and preserve cash.
Group chief executive Duncan Wanblad said this follows higher-than-normal levels of inventory remaining in the midstream and an expectation for a protracted recovery.
De Beers’ rough diamond production decreased by 15% to 6.4 million carats in the second quarter of the year from 7.6 million carats, a year earlier.
Although there is a potential reduction in the 2024 output, the diamond company’s production guidance remains unchanged at between 26 million and 29 million carats.
"Trading conditions became more challenging in the second quarter as Chinese consumer demand remained subdued,” said Wanblad.
Anglo, which has an 85% stake in De Beers, said in May that it is exploring the full range of options to separate the business to set it up for success in unlocking full value from its new Origins strategy, its world-class assets and its iconic brand.
This confirmed a recent report by the Wall Street Journal (WSJ) that Anglo American was contemplating the sale of De Beers.
Anglo was said to have engaged in discussions with prospective buyers, including Gulf sovereign wealth funds and luxury houses.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
