Botswana's Gem Output May Jump 36%


"The world's biggest diamond producer may produce 24 million carats."

Botswana, the world's biggest diamond producer, may produce 24 million carats of gems in 2010, 36% more than last year, as demand recovers following a global economic recession.

"The market is improving and we will increase output," said Kgomotso Abi, director of mining at Botswana's Department of Mines. "It all depends on the market."

Three of the southern African nation's four diamond mines are currently operating below capacity, while Damtshaa in the northeast is temporarily closed, said Abi. Botswana would be able to raise output further if necessary, he said.

Botswana produced about 17.7 million carats in 2009, down from 32.3 million carats a year earlier. It will take another two years for gem production to recover to pre-recession levels, Finance Minister Kenneth Matambo said on Feb. 11.

While rough diamond prices have risen in the past year, returning to levels last seen in June 2008, the global economic climate remains fragile, especially in the U.S., Japan and Europe, De Beers said on July 23.

'Next Big Thing'

Retail sales in the U.S., which accounts for half of global diamond consumption, are growing at the fastest pace in four years, driven by an 8% jump at luxury chains this year, the International Council of Shopping Centers said on July 7.

Botswana, which produces about a fifth of global diamond output, wants to reduce its dependence on the stones. Coal could be the "next big thing" for the country, Abi said.

Logistics are the main constraint stopping Botswana developing its coal industry, and as a result the country is in talks about building a rail line that would allow it to export coal from ports in Namibia, he said.

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