Debswana, Botswana, reduces diamond production due to persistently low demand

The Debswana Diamond Company of Botswana announced on Friday that it is temporarily halting production at a few of its mines, reducing output in reaction to the ongoing decline in the world diamond market.

Due to a decline in the world diamond market that began in the second half of 2023, Debswana reduced its production by 27% to 17.93 million carats in 2024. Debswana, which sells over 90% of Botswana’s diamonds, reported a 46% decrease in sales last year.

The company, which is a 50/50 joint venture between the government of Botswana and the multinational conglomerate De Beers, stated in a statement that it now intends to cut production to 15 million carats by 2025.

“Debswana Diamond Company continues to prudently navigate the challenging market conditions, including sustained low demand across the diamond pipeline and emerging pressures such as U.S.-imposed tariffs,” it stated.

The Letlhakane tailing plant and Jwaneng Modular facility were suspended in April, and Debswana is also temporarily halting production at the Jwaneng Cut 9 and Orapa mines.

According to Debswana, the periodic stoppages should result in significant cost reductions for energy, gasoline, and other industrial consumables.

Long-term projects like the Jwaneng underground project, which aims to turn Debswana’s most important open pit mine underground, will go ahead, while some capital projects will be delayed down in order to save money.

It further stated that although the company still offers voluntary separation, no involuntary job losses are planned.

30% of Botswana’s income and 75% of its foreign exchange profits come from diamonds, and the country’s economy shrank by 3% in 2024 as a result of the current market slump. An additional 0.4% contraction this year is predicted by the International Monetary Fund.