De Beers Group is optimistic about business this year

Due to the encouraging demand for diamonds since the beginning of the year, blue chip diamond company De Beers Group is optimistic that its business will rebound this year compared to 2020.

While reporting the Group’s 2020 financial results, De Beers Executive Vice President Diamond Trading, Paul Rowley, stated that the Group’s revenue in 2020 was $3.4 billion, down 30% from the $4.6 billion reported in 2019. However, he is optimistic about growth in 2021.

“2020 was unprecedented year for the diamond industry globally and we also suffered from the effects of Covid-19. Containment measures such as the lockdowns impacted negatively on our business operations. There have been significant challenges for the rough diamond industry,” he said.

The buoyant De Beers Group executive said there has been high demand for diamonds in 2021 and therefore recovery is imminent. But he cautioned that the business has to be vigilant too.

Rowley added that the company’s target in 2021 is to produce between 32 and 35 million carats.

According to him, the production target is informed by the promising signals of recovery in the diamonds sales as most of De Beers’ top markets are showing resilient economic recoveries.

Anglo American, the parent company of De Beers, recently revealed that the rough diamond output at De Beers Group declined by 14% on its production report of fourth quarter (Q4) of year 2020.

The company said the decline was driven by continued planned reductions in response to the lower demand for rough diamonds caused by Covid-19 and operational challenges at the Orapa mine.

Anglo America owns 85% of De Beers Group, the world’s leading diamond company, with the remaining 15% owned by the Government of Botswana and both mining diamonds through Debswana mines.

“In Botswana, production decreased by 28% to 4.3 million carats, driven by the planned treatment of lower grade material at Jwaneng, where production decreased by 56%. This was partly offset by a 9% increase at Orapa due to a planned improvement in grade despite a slower than anticipated plant restart in December following scheduled maintenance as well as power supply interruptions affecting plant availability,” said Anglo American while reviewing Botswana.

But, Rowley said De Beers anticipates recovery at all Debswana mines in 2021. De Beers, a diamond mining giant which operates across the whole value chain of the lucrative industry, said it underwent massive transformation in 2020 so to withstand the pandemic heat wave.

Rowley indicated that as part of accelerating the transformation, the Group down streamed its operations and announced new brands like 12 Forever goals as well consumer markets division.

Giving update on community response in 2020, De Beers Group Chief Financial Officer, Susanne Swanniker-Tettey said the company cushioned the communities it operates in amidst Covid-19.

She said that included the launch of Building forever 2030 goals – the sustainability and commitment goals by which the Group intends to build partnerships for thriving communities.

The Group’s 12 Building Forever ambitious sustainability goals for the coming decade include achieving gender parity throughout its workforce, a diamond producing partner countries and being carbon neutral within its own diamond mining operations by 2030.