De Beers‘ diamond production fell 90.8 percent in the first quarter of this year, according to a report by Anglo American Plc, which owns 45 percent of the mining company.
De Beer’s, the world’s largest diamond producer, cut its production from 11.8 million carats in the first quarter of last year to just 1.08 million carats in the same quarter this year.
Announcing the fall in its Interim Management Statement, Anglo American Plc said production was reduced “in response to lower anticipated demand”.
“In light of lower market demand, De Beers reduced production at all its mines through a combination of production holidays and reducing shifts worked, allowing sales from existing inventories in order that sales demand was met,” the company said.
Meanwhile De Beers Group managing director Gareth Penny told Diamond Intelligence Briefs that the company has taken “significant steps” to realign its cost base and reduce production so that it can “remain profitable at significantly lower levels of sales”.
“We have and will continue to reduce mining output in line with client demand for new rough diamonds, but have the flexibility to adjust this level up or down as we proceed through 2009.”
De Beers Production in the second quarter of this year is expected to increase as the company’s Debswana mines, which accounted for more than 65 percent of its output last year, recommenced production last month.