Canadian miner Diamcor Mining says it will turn its focus back to the advancement and growth of its Krone-Endora at Venetia project, in South Africa’s Limpopo province, this year, following various challenges navigated in 2023.

The company’s primary focus areas this year will be to continue trial mining and optimisation of operational efficiencies, with ancillary diamond recoveries and sales revenue poised to assist in supporting the advancement of Krone-Endora’s recommended work programmes and advancement.

Diamcor will also advance additional bulk sampling on key areas of interest within the remaining 85% of the property to determine the potential extent and location of material from De Beers’ neighbouring Venetia mine into these areas.

Diamcor says the finalisation of planned additions to the project’s processing plant and final recovery system will support increases in processing volumes and enable increased ancillary revenues, as well as reduce costs in the long term.

The company says last year proved to be one of adaptation and strategic realignment for the diamond industry as the world continued to emerge from the Covid-19 pandemic, including through changes in consumer spending habits and allocation of countries’ funds.

The continued buying of rough diamonds at the previously elevated levels of 2022 by many in the industry – despite changes in consumer spending – resulted in short-term excess rough diamond inventories and downward pressure on pricing.

Significant reductions of new rough diamond sales by the world’s largest producers in the second half of 2023 aided in rebalancing the excess inventories and supported price recovery, Diamcor explains.

The decision by the world’s largest cutting and polishing country, India, to temporarily suspend the import of rough diamonds from October 15 to December 15, for example, helped to rebalance the market.

Continued geopolitical concerns surrounding the ongoing Russia/Ukraine conflict and recent Israeli/Palestinian conflict impacted on demand last year, as did economic uncertainties, which continued in the industry’s most important market of the US, as well as slower-than-expected post-Covid-19 economic recovery in China.

The initial Group of Seven (G7) sanctions on rough diamonds originating in Russia proved largely ineffective throughout the year; however, several revisions by the G7 to increase the effectiveness of these sanctions came into effect on January 1 this year.

Additional sanctions on rough diamonds originating in Russia were also announced by the European Union on January 3.  

“The industry demonstrated its ability to implement proactive changes in 2023 to strengthen itself for 2024, and Diamcor reaffirms its belief in the unique value proposition of its Krone-Endora at Venetia project given its ability to provide non-conflict natural rough diamonds to the world market moving forward,” Diamcor states.

Unlike their lab-grown counterparts, natural diamonds are treasured for their rarity, provenance, and the timeless allure they hold, and with limited supplies of natural diamonds remaining, the revised sanctions on Russia, which comprises 30% of yearly production globally, and many mines reaching the end of their lives, the general sentiment in the industry is that yearly production levels are expected to continue to drop in the years to come.

The adjustments made by the industry in 2023 appear to have been effective, with price recoveries in various categories becoming apparent later in the year.

The company believes this trend of increasing prices will continue into 2024 and moving forward, with the level of increases ultimately being driven by combined elements such as: consumer spending, increased shortages owing to revised sanctions on Russia, potential reductions in yearly production from existing mines, and increased demand due to the recovery and growth of emerging markets such as China and India.    

Diamcor concludes that it will continue to identify and evaluate opportunities that demonstrate the potential for additional near-term production of natural gem quality rough diamonds from non-conflict areas to support the company’s future growth and shareholder value.