Botswana to Settle for Smaller De Beers' Stake?

 

Botswana may now settle for a minority stake in De Beers rather than seeking majority control, according to a report in The Economist.

It says the government is now pursuing at “least 25%,” which would indicate a significant softening in President Duma Boko’s position.

He has previously insisted, on many occasions, that he wants a controlling stake in the company, framing such a move as a matter of “economic sovereignty”.

The Economist also quotes an unnamed executive at Debswana – the government’s joint venture with De Beers, as saying: “It probably doesn’t make sense to go all out.”

Botswana currently owns 15% of the loss-making diamond miner, which is being sold by parent company Anglo American.

In December 2025, the IMF cautioned against Botswana’s plans to increase its stake, given the country’s struggling economy.

The president rejected that call in no uncertain terms saying it was for the people of Botswana to decide, not the IMF.

“It’s our people who are running this country, and we said we want De Beers, and we are going to take it,” he said.

Angola’s government has also expressed an interest in acquiring a significant stake in De Beers, and Namibia is also a potential bidder.

Experts believe the most likely outcome will be that a consortium or private investors will buy a controlling stake, and African governments including Botswana will hold minority shares.

Source: DCLA

Botswana seeks to raise debt ceiling to weather diamond market downturn

 

Natural rough diamond embedded in rock, mineral extraction challenge

Botswana’s finance minister sought parliamentary approval on Wednesday to raise the country’s statutory debt ceiling from 40% to 60% of gross domestic product, as a prolonged downturn in the global market for diamonds has pressured public finances.

Ndaba Gaolathe said the proposal was aimed at giving the government flexibility during periods of economic stress, such as the one it is going through now.

The diamond market downturn has hit the southern African country hard, with two successive economic contractions in 2024 and 2025. Botswana had been viewed as an economic success story, partly because of its low public debt.

Raising the debt ceiling “does not imply immediate borrowing up to that level but rather establishes prudent headroom,” Gaolathe told lawmakers.

In last month’s budget, he said Botswana was expected to breach a debt-to-GDP ratio of 40% in the fiscal year that starts in April.

Late last year International Monetary Fund staff recommended raising the debt ceiling to 50% of GDP to give fiscal space to respond to economic shocks.

S&P Global this month downgraded Botswana’s sovereign ratings, saying diamond market weakness would weigh on its economy for longer than expected.

Diamonds typically account for about a third of Botswana’s national revenue and 75% of its foreign-exchange earnings.

Source: DCLA

DCLA News | Botswana Doubles Down as Diamond Supply Tightens and Demand Strengthens

 

The diamond pendant worn by Bogolo Kenewendo at a recent Cape Town mining conference was more than a personal statement it symbolised Botswana’s unwavering commitment to the very resource that transformed its economy.

For decades, De Beers has been synonymous with Botswana’s rise, helping elevate the nation into one of Africa’s most prosperous economies. Now, Botswana is preparing to deepen that relationship, signalling intentions to increase its existing 15% stake in the iconic diamond firm a bold move that underscores its long-term confidence in the sector.

Supply Tightens as Market Shows Early Recovery

At the same time, signs of recovery are emerging across the global diamond market. Russian mining giant Alrosa has reported price increases of between 6% and 9% on rough diamonds since the start of the year, with the strongest gains seen in the high-value 2 to 10 carat segment a category that represents roughly 80% of its production value.

According to CEO Pavel Marinychev, the market for larger stones — particularly those above 3 carats — has stabilised, with tightening supply now becoming increasingly evident. Price improvements, initially modest in January, have accelerated through February and March, with nearly half of Alrosa’s regular assortment seeing upward revisions.

Global Production Faces Structural Decline

Looking ahead, the supply side of the diamond industry is under significant pressure. Alrosa forecasts that global diamond production will fall below 100 million carats by 2026 the lowest level in two decades.

This decline is being driven by a combination of resource depletion and operational cutbacks. Alrosa itself has already suspended output at several smaller projects, while major deposits are reaching the end of their lifecycle. Notably, the Diavik Diamond Mine, operated by Rio Tinto, is approaching closure, with other Canadian mines expected to follow.

The result is a growing scarcity of large, high-quality stones a dynamic that could underpin prices in the years ahead.

Auction Market Confirms Demand for Rarity

Further evidence of resilience in the diamond market comes from the secondary sector. Christie’s New York recently reported strong results from its “Jewels Online” sale, which achieved $8.5 million and exceeded expectations by reaching 131% of its low estimate.

Among the highlights was a 10.02-carat D-colour, internally flawless Type IIa diamond ring by Tiffany & Co., which sold for $521,000. Another 10.03-carat D-colour Type IIa diamond achieved $508,000 significantly above its estimate.

Provenance also played a key role, with a historic jewellery set from Elizabeth Taylor’s collection selling for over seven times its low estimate.

Christie’s noted strong global participation, with buyers spanning the Americas, Asia-Pacific, and EMEA regions reinforcing the enduring demand for rare, high-quality, and well-documented diamonds.

Strategic Outlook

Botswana’s move to increase its exposure to De Beers is not without risk but it is a calculated one. With global supply tightening, major deposits depleting, and demand for exceptional stones holding firm, the country is effectively positioning itself to capture greater long-term value from a shrinking resource base.

For the global diamond trade, the message is clear: scarcity is returning and with it, the potential for renewed price strength, particularly at the top end of the market.

Source: DCLA

De Beers Slashes Number of Sightholders

 

De Beers has reportedly slashed the number of sightholders who can buy their goods by as much as a third, as it seeks to consolidate supply among a small core of stronger buyers.

The number of sightholders is understood to have been reduced from 69 to around 45, although De Beers has not confirmed numbers. Sightholders were informed by letter or phone call on Friday, 20 March.

It is the second biggest cut, in percentage terms, since sights were launched back in 1934. The number of De Beers sightholders peaked at around 350 in the 1970s.

It was halved in April 2001 as the company sought to prioritize value-driven buyers over sheer volume of sales.

De Beers warned current sightholders back in October 2024 that it would be terminating some of their supply agreements, by way of what it called an objective selection and allocation process.

Existing contracts, signed in 2021 and extended last year through June 30, 2026, end soon, paving the way for the new roster starting July 1.

The cutback suggests that the loss-making miner is repositioning itself for survival in a weaker market by creating a limited customer base that can reliably take volume in tough times.

Anglo American’s repeated De Beers write-downs (the latest by $2.3bn in February 2026) underscore the loss-making reality. De Beers CEO Al Cook emphasized “quality over quantity” in late 2024, aiming for deeper partnerships including polished diamond sales from Botswana-sourced stones.

De Beers last reduced the number of sightholders in January 2021, when it introduced new contracts dividing buyers into three categories – dealers, manufacturers and integrated retailers.

Source: DCLA

Botswana Diamonds rebrands, targets copper

 

Botswana Diamonds (LON: BOD) will rebrand as Botswana Minerals and trade under the new ticker BMIN from February 27 as it expands into copper exploration to cut exposure to a prolonged downturn in the diamond market.

The name change follows a strategic review driven by an advanced artificial intelligence model applied to the company’s 95,000 sq km geological database, which includes 375,000 km of geophysical data. The analysis identified significant opportunities beyond diamonds, prompting the board to broaden its focus.

After initially assessing diamond prospectivity, the AI model highlighted additional highly prospective areas. The company secured new diamond licences and defined several drilling targets, with work programs under way to advance drill-ready prospects across the portfolio.

Chairperson John Teeling said Botswana remains one of the world’s premier mining jurisdictions. “Botswana is a top location for exploration, geologically, politically and economically. We have historically focused on diamonds, where we hold highly prospective exploration ground. However, the diamond industry is currently out of favour with investors,” he said.

The global diamond sector faces both technological disruption and a cyclical downturn. Lab-grown stones are expected to dominate the lower end of the market, while large, high-quality natural diamonds remain rare and in demand. Botswana is one of the world’s leading producers of large, rare diamonds, with the sector accounting for about one-third of national revenue and roughly 75% of foreign exchange earnings.

Copper push
After searching for diamonds, the AI team applied the model to other minerals and identified 11 copper target areas. The company applied for the most prospective ground and secured eight copper licences. Teeling said the analysis revealed “strong copper prospectivity, a metal with a very robust future.”

Botswana Minerals has launched a two-stage work program to define and prioritise drill targets across its copper portfolio. It said the newly granted licences have attracted significant third-party interest.

Copper’s long-term outlook is supported by its central role in electrification and the global energy transition, as demand rises amid US and China efforts to secure supply chains for clean energy and high-tech industries. Botswana is positioning itself as an emerging copper producer and continues to promote its exploration-friendly credentials.

The company said the rebrand reflects its expanded strategy while maintaining exposure to both diamonds and copper in a country it considers strategically important for future mineral supply.

Source: DCLA

Botswana's State-owned diamond company turns to contract sales to manage tough market

 

Botswana’s State-owned Okavango Diamond Company plans to increase the share of diamonds it sells to contracted buyers as a way to navigate a depressed global diamond market, acting MD Lipalese Makepe said on Wednesday.

Contract diamond sales are more predictable compared with auctions and tenders that are highly competitive and often lead to price volatility.

Surplus supplies, falling demand and the rising popularity of lab-grown diamonds have weighed on rough diamond prices in recent years. Economic slowdown has also led to reduced diamond sales.

Until last year, the state diamond marketing company mainly sold its gems through auctions and tenders because a clause in Botswana’s contract with De Beers had prevented Okavango Diamond Company from directly competing with it.

CONTRACT SALES BEGAN WITH A PILOT LATE LAST YEAR
ODC was able to begin contract sales after the Botswanan government signed a new agreement with De Beers in February 2025.

“We piloted the contracts in November and December with an average of 14 customers,” Makepe told Reuters on the sidelines of an African mining conference in Cape Town. The number of contracted customers has risen to 32, she added.

“We plan to sell about 50% of our Debswana allocation by value,” she added, referring to ODC’s allocation of production from Botswana’s diamond mining company. Initially the plan was to sell 40% by contract.

Makepe said the balance of its allocation will be sold through the normal ten auctions a year and strategic partners as well as citizen-owned companies.

ODC could also pursue special auctions, Makepe said, despite last year’s inconclusive attempt.

The company sold about three-million carats in 2025 from over four-million carats of its allocated supply, according to Makepe, and 2026 sales are likely to be in the same range in line with their allocation from Debswana.

ODC’s rough diamond allocation from Debswana – Botswana’s joint venture with De Beers – increased to 30% from 25% and will reach 40% at the end of the 10-year agreement.

De Beers, the world’s largest diamond company by value, is a unit of Anglo American, which has been seeking to sell it ahead of its mega merger with Canadian miner Teck Resources.

Anglo American CEO Duncan Wanblad, also speaking on the sidelines of the Indaba conference, told Reuters he was prioritising the sale, most likely to a consortium given the lack of big strategic diamond players in the current market.

Source: DCLA

Anglo flags third De Beers writedown as Teck merger looms

 

Anglo American is weighing a third writedown of De Beers in as many years as weak diamond prices persist and the miner advances asset sales ahead of its merger with Canada’s Teck Resources.

The century-old group said on Thursday it was reviewing the carrying value of its diamond business after average realized prices fell in 2025, warning the unit is likely to be lossmaking again.

The potential impairment comes as Anglo moves to finalize the sale of non-core assets, including De Beers. At the same time, the miner is preparing to merge with Teck in a transaction approved by shareholders and regulators late last year, creating Anglo Teck (official named confirmed).

The company booked a $2.9 billion impairment on De Beers in February last year, following a $1.6 billion writedown in 2024. Anglo, which owns 85% of the diamond company, offered few details on a sale process, saying only that it was “progressing.”

In a fourth-quarter production update, Anglo said diamond trading conditions “continued to be challenging” amid industry weakness, geopolitical tensions and tariff uncertainty. It said lower prices and market conditions could lead to an impairment when full-year results are released.

Diamond prices have come under pressure from weaker consumer demand in China and competition from cheaper, lab-grown stones. De Beers’ average realized price fell 7% to $142 per carat in 2025, driven by a 12% drop in the average rough price index.

Anglo said the decline was exacerbated by selling inventory below cost, largely lower-value goods. Adjusted for that mix, the equivalent price index reduction would have been 25% year on year, suggesting some underlying resilience in the market.

De Beers sold 5.9 million carats in the fourth quarter, up from 4.6 million a year earlier, lifting revenue to $571m from $543m. Even so, Anglo said it was undertaking an impairment review that could result in another writedown.

Exit hurdles
The prolonged slump complicates Anglo’s efforts to exit De Beers. Chief executive Duncan Wanblad said only that the sale was moving forward. A consortium led by former De Beers managing director Gareth Penny is seen as a frontrunner, though Botswana, which owns 15% of the company, has said it wants to take control.

Namibia has also expressed interest, and former chief executives Bruce Cleaver and Penny have been mentioned as potential buyers.

The De Beers sale forms part of a restructuring unveiled in 2024. Anglo demerged its platinum arm, Amplats (now Valterra), in June 2025, while the planned sale of its Australian metallurgical coal mines stalled after Peabody Energy (NYSE: BTU) walked away following a fire at Moranbah North.

Wanblad said on Thursday that the formal sale process for steelmaking coal was “progressing well,” without naming alternative buyers or addressing potential compensation from the US firm.

Copper reality check
Copper remains central to the Anglo-Teck investment case, but near-term output expectations have softened. Anglo cut its 2026 copper guidance to 700,000 to 760,000 tonnes from 760,000 to 820,000 tonnes, citing lower grades at several operations.

It also trimmed 2027 guidance to 750,000 to 810,000 tonnes, including at Collahuasi in Chile, which Anglo and Teck plan to integrate with Teck’s neighbouring Quebrada Blanca mine. For the longer term, the group added new guidance for 2028 of 790,000 to 850,000 tonnes.

A 15-km (9.3-mile) conveyor would be built to feed Collahuasi’s high-quality ore into QB’s new processing plants. (Click on map to enlarge)
Copper production in 2025 was 695,000 tonnes, roughly flat year on year and at the lower end of guidance. Goldman Sachs said output missed its estimate by 5%, with Anglo’s Quellaveco mine in Peru falling short by 10% on lower-than-expected grades. Collahuasi’s underperformance was already known, while Los Bronces in Chile ended the year strongly.

Adjusting for Collahuasi, the underlying miss narrows to about 2%, which Goldman said better reflects what the market had already priced in.

A sharp rise in copper prices in recent months has renewed interest in the metal and helped spur merger talks between rivals, including the once again abandoned merger between Rio Tinto (ASX, LON: RIO) and Glencore (LON: GLEN).

With ageing mines delivering lower grades and new projects costly and slow to develop, copper dealmaking has become more attractive as supply constraints tighten across the sector.

Source: DCLA

Botswana Diamonds Secures Eight New Prospecting Licences, Expands into Copper Exploration

 

Aim- and BSE-listed Botswana Diamonds has been awarded eight new prospecting licences covering approximately 7,000 km² in north-western Botswana, marking a strategic expansion into copper exploration, with additional potential for gold and other critical minerals.

The licences, valid until 31 December 2028, were identified through an extensive AI-driven analysis of the company’s 95,000 km² Botswana-focused exploration database. This dataset includes comprehensive geophysical survey information, which highlighted strong prospectivity for copper, alongside indications of gold and energy-transition metals.

The same proprietary AI technology has previously delivered notable success in diamond exploration, identifying six previously unreported kimberlite-prone areas for which Botswana Diamonds also holds licences.

The company said the move into copper reflects ongoing weakness in the global diamond market, combined with robust and growing demand for copper and other minerals critical to the global energy transition.

Botswana Diamonds highlighted Botswana’s stable operating environment and strong geological potential, noting active copper mining and exploration in the country. Established operators include MMG and Sandfire Resources, while exploration activity is also being undertaken by Cobre, which has a joint venture with BHP, as well as Kavango Resources, Galileo Resources and Aterian.

Initial discussions have already commenced with potential partners regarding joint venture opportunities to advance exploration across the newly awarded licences. The company plans to undertake close-spaced geophysical and geochemical surveys to define priority drill targets.

Despite the diversification, Botswana Diamonds confirmed it remains committed to its core diamond strategy and will continue to monitor market conditions and capital deployment into its diamond assets.

Chairperson John Teeling said the latest AI analysis had delivered “exceptional results”, following the earlier identification of kimberlite-prone ground that led to the discovery of six previously unknown anomalies.

“The outcomes were outstanding. We have now secured eight prospecting licences covering many of these areas. Copper and other energy-related minerals are critical to the energy transition for a greener future,” Teeling said on 26 January.

He added that while the diamond market is currently under pressure, the company’s long-term focus on diamonds remains unchanged.

“These market conditions will improve, and this strategy allows us to continue progressing as a mining company while remaining committed to diamonds over the longer term. In the meantime, there has been strong third-party interest in both our technology and our results, creating clear potential to advance these licences efficiently through partnerships and structured exploration programmes,” Teeling said.

Source: DCLA

Botswana Warns Diamond Oversupply Threatens Economic Growth

 

Botswana has warned that a growing diamond oversupply is set to weigh heavily on economic growth, as weak global prices and intensifying competition from lab-grown stones continue to suppress demand.

The world’s second-largest diamond producer after Russia is currently holding nearly double its permitted diamond stockpile, highlighting the severity of the downturn in the natural diamond market. Diamonds account for approximately one-third of Botswana’s GDP, making the sector critical to national economic stability.

According to the finance ministry’s 2026/27 Budget Strategy Paper published on Tuesday, Botswana held around 12 million carats of rough diamonds at the end of December, significantly above the government’s 6.5 million-carat ceiling.

“This suggests that, over the short term, production is expected to remain broadly unchanged until inventory levels are drawn down closer to minimum allowable thresholds, creating room for additional output,” the ministry said.

The prolonged slump has been exacerbated by weaker demand in the United States and China — the world’s two largest diamond markets — where retailers have scaled back orders amid growing consumer preference for lower-priced lab-grown diamonds.

Trade pressures are also adding to market strain. A 15 percent US tariff on diamonds, along with higher duties in key trading hubs such as India, is expected to prolong price weakness and further compress margins. The finance ministry described these developments as a “source of concern”.

Rough diamond prices are forecast to average $99.3 per carat, sharply lower than $128.8 in 2024. The ministry warned that any further decline during the current financial year could significantly reduce mineral revenues below current projections.

Mineral revenues are expected to fall to 10.3 billion pula ($770 million) in 2025/26, well below the long-term average of 25.3 billion pula. The shortfall, officials cautioned, is likely to persist over the medium to long term, with the possibility of a permanent structural decline.

The policy paper also warned that the extended weakness in the global diamond market “poses a significant threat” to economic growth. Botswana’s economy is forecast to contract by nearly 1 percent in 2025, following a 3 percent decline the previous year.

“Compounding this situation is the decline in foreign reserves and government savings, which is further constraining fiscal space and limiting exchange-rate policy options,” the ministry said.

Once among the poorest nations in the world, Botswana was transformed economically following the discovery of diamonds in the 1960s. Today, it is one of several African governments and businesses seeking a greater stake in De Beers, the world’s leading diamond producer.

Mining giant Anglo American has announced plans to divest from De Beers as the industry grapples with a prolonged downturn and structural shifts in global diamond demand.

Source: DCLA

Lucara Advances Karowe Underground Expansion Despite Global Diamond Market Slump

Lucara Diamond Corp is moving forward with the underground expansion of its flagship Karowe mine in Botswana, reaffirming long-term confidence in natural diamonds despite a challenging global market backdrop.

An updated feasibility study has confirmed that the underground project is expected to recover approximately 4.5 million carats over a 10-year mine life, extending Karowe’s production through to 2038. The study strengthens Lucara’s strategy to invest counter-cyclically at a time when the diamond industry is facing falling revenues, production suspensions, and intensifying competition from lab-grown diamonds.

Open-pit mining at Karowe is scheduled to conclude before June, after which surface stockpiles will continue to be processed while underground development progresses towards commercial production. Underground operations are expected to commence in the first half of 2028.

Lucara President and CEO William Lamb said the company remains focused on Karowe’s unique ability to deliver large, high-value stones. “We look forward to continuing to recover large, exceptional diamonds from the underground project,” Lamb said, noting that Karowe is the only diamond mine in the world to have produced nine diamonds weighing more than 1,000 carats.

The underground expansion carries a pre-production capital cost of US$779 million, of which US$436 million has already been invested over the past five years. The remaining US$343 million is expected to be funded through operating cash flow, supplemented by potential equity or debt financing. Lucara is currently engaging with existing lenders and its major shareholder to evaluate funding options.

The project delivers an after-tax net present value of US$432 million, with Lucara forecasting more than US$1.3 billion in net income over the life of the underground operation.

The mine plan targets the highest-value domain of the South Lobe of the AK6 kimberlite, which continues at depth beneath the existing open pit. The underground mine is designed to sustain a 2.85 million tonne-per-year mining and processing operation as surface mining winds down.

A Proven Source of Exceptional Diamonds

Since production began, Karowe—whose name means “precious stone” in the local language—has established itself as one of the world’s most prolific sources of exceptional diamonds. Notable recoveries include the 1,758-carat Sewelô (2019), the 1,109-carat Lesedi La Rona (2015), and the 813-carat Constellation, also recovered in 2015. The mine has also produced Botswana’s largest fancy pink diamond to date, the Boitumelo.

Despite current market headwinds, Karowe remains one of the highest-margin diamond mines globally, consistently producing around 300,000 high-value carats per year—a distinction that continues to underpin Lucara’s confidence in the project’s long-term fundamentals.

BHP Walks Away from Last-Ditch Bid for Anglo American

Mining giant BHP has walked away from a last-ditch attempt takeover bid for Anglo American, parent company of De Beers.

It announced on Sunday (23 November) that it was “no longer considering a combination of the two companies”.

Melbourne-based BHP made hostile bids for Anglo in April and May 2024, both of which failed.

The move prompted loss-making Anglo to start streamlining its operations, to divest some unprofitable activities, including its diamond division, De Beers and to focus on copper and other money-making assets.

Anglo had hoped to complete the sale of De Beers by the end of this year, but despite intense interest, from the Botswana government among others, that has yet to happen.

BHP renewed its bid primarily to disrupt Anglo American’s planned $53 billion merger with Canadian miner Teck Resources, which is expected to go ahead on 9 December

Source: dcla

Angola Makes a Bid for De Beers, Reshaping the Global Diamond Landscape

De Beers Global Sightholder Sorting a parcel of rough diamonds over a light box using a hand loupe.

Angola has signalled its intention to buy back the 85% stake in De Beers currently held by Anglo American, in a move that has immediately captured global industry attention. The proposal, made through Angola’s state-owned diamond company Endiama, comes at a time when the diamond sector has struggled to regain momentum after the downturn that began in 2022.

The announcement positions Angola decisively on the world stage. The country produced 10.7 million carats in the first nine months of the year and is targeting a record 14.8 million carats by 2025. According to the Kimberley Process, Angola’s expected 14 million carats in 2024 place it above Botswana in rough-diamond output for the first time in two decades. This surge, driven by the vast Catoca open-pit mine and other major deposits, underscores Angola’s long-term strategy of advancing local beneficiation and resource industrialisation.

Against this backdrop, Endiama has formally expressed interest in acquiring Anglo American’s controlling stake as the parent company restructures and divests assets following its 2024 strategic review. Should the transaction proceed, it would mark one of the most consequential ownership shifts in the diamond industry’s modern history.

Complicating the landscape is Botswana’s position. The country currently holds the remaining 15% stake in De Beers and announced in September its intention to increase its shareholding to more than 50%. Botswana relies heavily on diamonds, which account for roughly one-third of government revenue and 80% of exports, while Angola is seeking to reduce dependence on oil through expansion of its mining sector.

The implications of an Angolan takeover are far-reaching. De Beers remains one of the world’s most influential suppliers of rough diamonds, with 2024 revenues of US$2.7 billion and a valuation near US$4.9 billion. Its sales cycles, production planning, and market guidance shape between one-quarter and one-third of global rough supply, giving the company significant influence over pricing, availability, and the high-end jewellery pipeline.

A shift in control could potentially redirect more value-added processes to Africa, including sorting, cutting, and polishing — areas historically dominated by centres outside the continent. Increased localisation could boost employment, strengthen regional economies, and reshape supply-chain dynamics at a time when Botswana has reduced output and seen fiscal pressure rise, while Angola’s production profile continues to accelerate.

However, questions remain. Angola has stated that the acquisition would not be funded through its national budget, leaving the structure and financing mechanism yet to be clarified. Diplomatic tension with Botswana is another risk factor, particularly if competing bids emerge or national interests collide.

On a global scale, the outcome could introduce both opportunity and volatility. Greater African control over rough supply may support local markets, but the broader diamond industry continues to face challenges, including subdued demand, geopolitical instability, and mounting competition from lab-grown diamonds, which have disrupted consumer expectations and pricing patterns.

If Angola’s bid succeeds, it would mark a historic realignment of influence within the natural-diamond sector — one with the potential to reshape trade flows, pricing dynamics, and the strategic balance of power for years to come.

Source: DCLA

 De Beers Sale: Botswana Plus One or Two Buyers

Anglo American CEO Duncan Wanblad says the sale of De Beers will involve one or two shortlisted buyers alongside the government of Botswana, rather than the usual two-round selection process.

Wanblad (pictured) told the Financial Times Metals and Mining Summit (held in London and virtually): “This isn’t going to be the classical first round, second round sale process that you would ordinarily receive for businesses of this type.

“What we are planning to do is now move into the second round with one or two of the potential selected buyers that came through the first round with us and work with the government of Botswana in finalising an agreement that works not only for the potential buyers, but also for Botswana.”

Anglo is expected to raise $3bn to $4bn from the sale of its 85 per cent stake in the loss-making diamond miner. The remaining 15 per cent is owned by the government of Botswana, which wants to secure a majority holding, and to do so by the end of this month.

Angola’s state-owned mining company Endiama has submitted a fully financed offer for a minority stake, as part of a pan-African proposal, which would include Botswana, Namibia, and South Africa.

Former De Beers CEOs Bruce Cleaver and Gareth Penny are leading bidding consortia and there is speculation about interest from Qatari and other Gulf investors.

Source: DCLA

Major opportunity for the diamond business to return to old strengths, says luminary

Botswana is seeking a greater interest in De Beers, and Angola is seeking an interest too. To the mind of diamond luminary Martyn Charles Marriott, this could be an opportunity to return to old strengths and disciplines.

In an article on the website of the International Diamond Manufacturers, Marriott cautions Botswana about going it alone and falling into the trap of yet again putting all its eggs into one basket.

Marriott notes that the current deal Botswana has with De Beers is fantastic in that 80% of mine profits go to Botswana – a level that far surpasses anything in the mining industry anywhere in the world.

Marriott expresses the view that the debate now under way about the future of De Beers presents an opportunity for a return to the discipline and control of the natural diamond market.

Many recall that the best economic viability of the diamond industry took place in the days when it had a stockpile and a quota approach, which kept supply and demand in crucial balance.

In addition, large sums were spent on unforgettable advertising campaigns and the entrenchment of the global diamond engagement ring tradition.

Collaboration is what gave diamonds their old strength; fragmentation is what is causing their current weakness.

Marriott recalls how collaboration led to flow of alluvial diamonds from West Africa being absorbed by the diamond buying offices that were created at source. In addition, Russia recognised the way in which the collaborative approach was good for everyone, from diamond miners through to diamond cutters, diamond traders, and diamond consumers.

It was Marriott, as the then manager of De Beers Dicor, who persuaded the government of Sierra Leone about the benefits of collaboration. This was ahead if his departure from De Beers, which coincided with the discovery of diamonds in Botswana, where he played a key consultancy role from 1970 to 1983.

It was then that Botswana was persuaded that the Central Selling Organisation system could uplift its economy – but with the caveat that the diamonds had to be properly sorted and valued, and production at Botswana’s Orapa was increased to a level that helped Botswana secure a favourable quota. It was also Marriott who initially proposed that the future development of the mines in Botswana should be by an equally shared 50/50 company.

For more than a dozen years, Marriott was a member of Botswana’s negotiating team with De Beers, which secured the very high level of profits that would accrue to the Botswana government from the development of its diamond mines. During the joint development of Jwaneng, he coordinated Botswana’s inputs into the project.

Interestingly, in 1980, even the Australians were persuaded about the merits of the Central Selling Organisation for the Argyle mine.

From 1985 through to the end of the century, Marriott was heavily involved in the restoration of the Angolan diamond industry, as consultant and valuer to Endiama, the article in on the website of International Diamond Manufacturers recalls.

In this instance, as production in Angola was then small, Marriott initially advocated sales by tender amid the build up a successful sales procedure that was eventually undermined by corruption.

The establishment of the Kimberley Process also came about with Marriott help, but unfortunately, in 1986, the diamond world began to disrupt. Argyle and De Beers ceased their cooperation. The Russians became increasingly independent, and Canadian mines opted to market their production separately.

Now synthetic diamonds are adding to the competition.

Meanwhile, Martyn’s two sons, Luke and Benjamin Marriott, are continuing worldwide valuing and have developed eValuer, a system of pricing and valuing diamonds.

“I relate all the above to demonstrate the experience that leads me to write this article concerning a possible future for the natural diamond industry based on cooperation between the African producers,” Marriott writes.

“I must admit that I found no enthusiasm for my ideas for African cooperation during my time working for the Government of Botswana. Moreover, at the end of my work there, I was at odds with its policy. I did not believe in the move towards local processing. I felt it unlikely that local establishments could compete with the industry as it stood, particularly the Indians. I preferred a sovereign wealth fund, further development of the cattle industry, tourism, and concentration on developing other industries. I felt that the pressure on De Beers for local processing could equally well be used on them and Anglo American to develop other industries.

“However, times change. Botswana is seeking a greater interest in De Beers, and Angola is seeking an interest too. To my mind, this could be an opportunity to return to old strengths and disciplines. Some sort of OPEC for diamonds that could provide a basis for the future,” Marriott proposes.

Source: Miningweekly