Anglo lowers diamond output in difficult market

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The miner offsets reduced iron ore from SA with increased production from Minas-Rio in Brazil as it keeps full-year group forecast steady

Anglo American, one of the world’s major diversified resources companies, lowered full-year production targets at two key subsidiaries in diamonds and iron ore, but kept its group forecast “broadly” intact.

The two stand-out updates in the production data were the reductions in diamond output at De Beers and iron ore from Kumba Iron Ore. De Beers noted a 14% drop in second-quarter production to 7.7-million carats, which brought interim output to 15.6-million carats, an 11% decline year on year. Kumba, which is SA’s and Africa’s largest iron ore producer, reported output of 10.5-million tons for the June quarter, a 9% drop compared to the same quarter a year ago.On an interim basis, Kumba, which is 70% owned by Anglo, recorded an 11% fall in production to 20.1-million tons, stemming largely from unscheduled plant maintenance at its flagship Sishen mine in the Northern Cape. At the nearby Kolomela mine, maintenance work at a processing plant has gone on longer than expected.

Anglo expects to secure an operating licence for its expanded Minas-Rio tailings dam before the end of 2019. Without it, the mine may have to slow or suspend production.

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