In a sign the diamond markets are beginning to improve, mining has resumed in Botswana, after an unprecedented 50-day halt in production, De Beers said in a news release.

The Jwaneng, Orapa and Letlhakane mines, the country’s three largest mines, restarted operations Tuesday with some 5,800 people returning to work, the company said. Production had been suspended at the mines amid declining demand for diamonds due to the world financial crisis. Production at the fourth and smallest mine, Damtshaa, and at Orapa’s No.2 Plant, will remain suspended until the end of 2009.

The mines are owned by Debswana, a joint venture between De Beers and the government of Botswana.

“The first quarter of 2009 was a challenging time,” said Stephen Lussier, chairman of De Beers Botswana. “The men and women that work for Debswana responded swiftly to the global downturn, enabling the company to withstand the economic crisis.  This accomplishment is all the more meaningful when considering the fact that, in the long term,  with future growth in emerging markets, demand is likely to significantly outpace what is forecast to be lower levels of diamond supply for many years to come.”

Lussier added that “we have begun to see signs of improvement in the market and expect this to continue as the year unfolds.”

During the pause in production, Debswana employees remained on full pay, and the company carried out maintenance work on its major assets to ensure the mines run at an optimal level when demand resumes.

JCK