Botswanaquotes Gem output may jump 36% as demand recovers
Botswana - Economic - 07-29-2010

Botswana, the worldquotes biggest diamond producer, may produce 24m carats of gems in 2010, 36% more than 2009, as demand recovers following a global economic recession. “The market is improving and we will increase output,” said Kgomotso Abi, director of mining at Botswanaquotes Department of Mines on 28 July 2010. “It all depends on the market.” Three of the southern African nationquotes four diamond mines are currently operating below capacity, while Damtshaa in the northeast is temporarily closed, said Abi. Botswana would be able to raise output further if necessary, he said. Botswanaquotes diamonds are produced by Debswana Diamond Co., a joint venture between De Beers, the worldquotes largest gem producer, and Botswanaquotes government. The venture shut its mines during the first quarter of 2009 as the global recession slashed diamond prices.

Botswana produced about 17.7m carats in 2009, down from 32.3m carats a year earlier, De Beers spokesman Tom Tweedy said by phone from Johannesburg. It will take another two years for gem production to recover to pre-recession levels, Finance Minister Kenneth Matambo said on 11 February 2011. While rough diamond prices have risen in the past year, returning to levels last seen in June 2008, the global economic climate remains fragile, especially in the U.S., Japan and Europe, De Beers said on 23 July 2010. Retail sales in the U.S., which accounts for half of global diamond consumption, are growing at the fastest pace in four years, driven by an 8% jump at luxury chains in 2010, the International Council of Shopping Centers said. Botswana, which produces about a fifth of global diamond output, wants to reduce its dependence on the stones. Coal could be the “next big thing” for the country, Abi said. Logistics are the main constraint stopping Botswana developing its coal industry, and as a result the country is in talks about building a rail line that would allow it to export coal from ports in Namibia, he said.


Source: Bloomberg