diamond sales | Radio 94.7 FM

South Africa’s state-owned diamond mining enterprise Alexkor is desperately in need of cash to pay expenses, but does the struggling entity deserve more funding?

Its marine-based concessions stretch from Alexander Bay to Port Nolloth, while its land-based concessions span the equivalent of 865km2. It mines the latter through its Pooling and Sharing Joint Venture (PSJV) with the Richtersveld community.

Despite carat sales having increased from 41 941 units to 70 061 in the year to end-March 2019, diamond sales only amounted to R209.9 million (2018: R208.7 million). Cost of sales was R152.9 million (2018: R126.8 million).

The reasons given for this poor performance: an oversupply of diamonds in the market, as well as the quality and size of the diamonds produced.

Land and shallow water diamonds achieved an average of $456.77 per carat (2018: $718.86), while diamonds from its deep water mining concession achieved an average price of $305.6
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The world-renowned De Beers Company is having an uphill battle in the world of diamond sales while the global economy looks less rosy.

With its seventh sales for the current year, it is already clear that the huge $1 billion drop in sales is indicative of a general slump in the diamond industry.

However, De Beers, who owns Anglo American, with 85% control, realized $ 280 million in sales for August, which is the seventh sales day of the year’s ten events.

De Beers is the world’s largest producer of uncut diamonds, but Russia is the largest, measured by carat production.

The economy is currently not favorable to the industry, as the drastic decline from last year’s $3.93 billion for the corresponding period of this year is only $2.91 billion.