Diamond Mining Roundup: The Cost of Cutting Back in First Half 2026

By Sam Cooley | August 17, 2026

A pattern is emerging from the depths of diamond mines around the world in 2026: Many producers are deliberately shrinking, and the cost of that choice is starting to show up in the accounts.

From Mirny to Yellowknife, Gaborone to Maseru, carats and dollars are coming apart for diamond miners in many countries.

Retailers are likely to be able to escape the biting consequence of this phenomenon throughout 2026 thanks to excess inventory held by miners and wholesalers, says diamond analyst Paul Zimnisky. But if the same dynamics continue to play out, he says it could lead to shortages in 2027 and 2028, with demand the critical variable in how sharply prices swing.

“Supply cuts seem to be putting a floor in rough prices as we speak, which could be a leading indicator for polished prices,” he says.

Rapaport’s index bears that out: In July, all four major categories—0.3 ct., 0.5 ct., 1 ct., and 3 ct. diamonds—posted flat or positive figures for the first time since March 2025, with the 1 ct. index ending 13 straight months of decline. Small stones were correcting upward on lower production.

Cuts to production are not evenly distributed, though, and the reasons differ sharply from one mine to the next.

Russian Diamonds

Alrosa, the world’s largest diamond producer by volume, spent the first half of 2026 in the red. The Russian miner posted a net loss of about $129 million (at 83 rubles to the dollar) for the six months to June 30, according to data published by the company. In 2025, Alrosa recorded a profit of about $470 million during the same period.

Its operations also hemorrhaged cash over the first six months this year, saddling the Russian miner with a $147 million shortfall, which its treasury floated by drawing down deposits and other short-term assets. By comparison, in 2025 during the same six-month period, the mines were generating about $330 million.

The company attributed the decline to a mix of factors, including sanctions, macroeconomic uncertainty, and slower demand for rough and polished stones.

Alrosa’s overall position has strengthened somewhat: It closed the half with $606 million in cash, and it cut its borrowings from $2.5 billion to $2.2 billion.

Speaking directly to Vladimir Putin last week, Alrosa’s own chief executive Pavel Marinychev said the diamond industry is in “the deepest sectoral crisis in its entire history,” according to Kremlin media.

Canadian Diamonds

Turning to the Great White North, Canada lost two of its three operating diamond mines in its Northwest Territories (NWT).

Rio Tinto’s Diavik mine, northeast of Yellowknife, NWT, delivered its final production in late March after 23 years and more than 150 million carats. It was a long-planned closure after a well-documented exhaustion.

Some 18 miles to the northwest, Ekati mine went a different way. Arctic Canadian Diamond Company, the subsidiary operating the mine, filed for insolvency this spring, blaming its woes on tariffs, the Iran war, and a depressed diamond market.

That leaves Gahcho Kué as the NWT’s last producing diamond mine—and the operation that best illustrates what can happen whilst so many others chose to cut. The mine recovered more than 2 million carats in the first quarter, up 163% year on year. It sold 858,173 carats for $29.2 million, with an average value of $34 per carat against $72 a year earlier. Mountain Province Diamonds, which holds 49%, posted a net loss of about $47 million for that quarter, attributing the decline to market weakness and a higher proportion of smaller stones coming out of the mine.

Last month the company delisted itself from the Toronto Stock Exchange; its auditor also resigned at some point this year. At least one mining finance professor in Canada raised some concern with CBC reporters that this could be a distress signal for a major (but not the only) player in the territory’s remaining diamond mine.

“If I had all these things happening behind the scenes, you know, the best way to do it is not be in the public’s eye,” said the University of British Columbia’s Carlos Da Costa, speaking to CBC’s Yellowknife reporter Sarah St-Pierre.

Botswana Diamonds

Debswana, the Botswana government’s 50-50 venture with De Beers, plans to lift its output to roughly 18 million carats this year from 15 million in 2025. It is still well short of the 24 million it produced before the downturn, but a deliberate step back toward volume.

In May of this year, the African country’s minister of minerals and energy, Bogolo Joy Kenewendo, told JCK that her country’s government plans to position the nation as the leading African trading center for diamonds and other minerals.

Fiscal arithmetic seems to explain the urgency. Diamonds account for 62.3% of Botswana’s earnings through exports and about one-third of its national revenue.

Export revenue of Botswana diamonds has fallen to about $1.18 billion (at 13.46 pula to the dollar) in the first five months of 2026. This represents a reduction of roughly 29% of revenue as compared with the same period last year.

In June, Kenewendo told Reuters the country is seeing a soft recovery in demand in the United States and China.

“We are going to continue to be disciplined. We were happy to do so because everything in the market is about some level of discipline on our side,” she said.

Lesotho Diamonds

At Lesotho’s Letšeng mine, the numbers went the other way—for reasons partly outside anyone’s control. The company that runs the mine, Gem Diamonds, reported first-half revenue up 33%, at average rough prices of $1,395 per carat, while recovering 12% fewer carats than a year earlier. Fewer stones, worth considerably more.

Eight stones were sold for more than $1 million each, yielding $16.1 million between them. Three diamonds above 100 carats came out of the pit. A gigantic 346.99 ct white diamond (aka the Lesotho Jubilee) was found in June, named to commemorate the country’s 60th independence anniversary.

But Letšeng is the highest dollar-per-carat kimberlite mine in the world, and even it has been bruised. The company’s 2025 revenue fell 36% and it recorded a $104 million loss. The expected lifetime of the mine was shortened from 2039 to 2035 on prevailing prices and costs, and part of its value was written off.

Despite the impressive-sounding rebound, the stats are measured against a badly damaged year.

(Photo: Getty Images)