Shinier 2020 expected for diamonds

Jo-Maré Duddy – Although Namdeb Holdings last year experienced its toughest production year since 2016, analysts expects a strong performance in 2020.Namdeb Holdings produced 1.7 million carats of diamonds last year, its weakest performance since 2016.Production results released by Anglo American and De Beers show Namdeb Holdings delivered 308 000 carats or about 15.3% less diamonds compared to 2018. Production from the diamond giant’s land operations plummeted by 164 000 or 29% to 408 000 carats. Debmarine Namibia delivered 1.292 million carats, a drop of 144 000 or 10% compared to 2018. Debmarine’s performance was impacted by routine vessel maintenance, Anglo says.Cirrus Capital anticipates strong growth in 2020, the result of the lower base set in 2019. “Vessel downtime and the gradual closure of onshore production in 2019 hampered Namdeb’s diamond output, but a strong recovery is expected this year,” the analysts say in their economic outlook for this year.“The sale of the Elizabeth Bay mine to Lewcor sees a new operator in the space for the first time in many years, an exciting development,” Cirrus continues. However, the analysts only expect major growth in diamond output from 2022, with the completion and introduction of Debmarine Namibia’s N$7-billion vessel.Financial impact“Namdeb’s onshore operations are expected to be shut down over the next few years, where most of its employment lies. However, this could be delayed as Namdeb is seeking reprieve in the form of changes to royalty payments, which would see the land-based mining continue. Given the implications on employment and the town of Oranjemund, Namdeb may well succeed in its request,” Cirrus says.According to the latest annual review of the Chamber of Mines in Namibia, Debmarine Namibia employed 954 people in 2018, while Namdeb Diamond Corporation had a workforce of 1 533.Debmarine spent about N$1.16 billion in local procurement in 2018, while the amount for Namdeb Diamond Corporation was N$2.27 billion. Together, the two companies corporate social responsibility (CSR) spent for the year topped N$9 million and they invested about N$107 million in training and skills development.Namdeb Holdings’ total wages and salaries bill for 2018 was nearly N$1.9 billion. Fixed investment for the year totalled nearly N$1.1 billion.The group paid about N$1.57 billion in corporate taxes, as well as around N$1.3 billion in royalties, N$141 million in export levies and N$800 million in dividends.Anglo American owns De Beers, who in turn owns 50% of Namdeb Holdings, while the Namibian government owns the other half.

Shinier 2020 expected for diamonds

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Republikein 2026-02-03

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Shinier 2020 expected for diamonds

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