If that seems a little high to you, De Beers just send me the following statement to clarify:
As we have already stated we aim to reduce production across the De Beers Group by around 40% for the full year 2009 – and that still stands. Each producer company MD decides how and when to implement their reduction. For example, Debswana decided it would make most sense to extend their Christmas vacation. These mines are now back up and running.
The combination of short-term inventories from Q4 2008, and low production in Q1 2009, have worked together to satisfy demand from the DTC clients. As expected, the production holidays in Q1, primarily at Debswana which accounted for 65% of De Beers’ overall production in 2008, significantly limited the carats produced in Q1. This production slowdown contributed to a 47% reduction in operating costs for De Beers, while also “drying-out” part of the pipeline. The lower production figures for Q1 are, however, not reflective of overall DTC sales.
Moving forward, we have seen increases in both demand and sales, Debswana has already returned to work, and we expect higher production levels to prevail for the remainder of the year.