Mining majors the world over are planning cuts in diamond production for the coming year.
De Beers has announced plans to cut back output at its two new Canadian mines, Snap Lake mine in Northwest Territories and the Victor mine in northern Ontario by 10 to 20 percent. This was followed by reports that Debswana, the diamond mining joint venture between De Beers and the Botswana government is looking at cutting production by about 20 percent in 2009.
Close on its heels, at a recent conference in Antwerp came the statement by Sergey Vybornov, the head of the world's second biggest producer, Russia's Alrosa, that he would follow the De Beers move and Alrosa could cut supply by as much as 40 percent.
These announcements reiterate the fact that the diamond industry is now feeling the heat of the global meltdown and is hoping to protect its assets by restricting supply and maintaining a minimal inventory.