(Reuters) -Anglo American anticipated a rise in its annual production of rough diamonds on Thursday, citing demand for diamonds from non-conflict zones amid the Russia-Ukraine situation. However, the miner reported a 9% decrease in quarterly group output.
With Russian gold and diamonds off-limits due to sanctions on companies, such as Alrosa—the world’s largest producer of rough diamonds that competes with Anglo American (LON:AALunit )’s De Beers—rough diamond demand has increased this year.
According to the World Diamond Council, Russia is the world’s largest producer of natural diamonds.
“The combination of sanctions against Russia and the choices of a number of U.S.-based jewellery companies to impose their own limits on purchases of Russian diamonds… has the potential to sustain solid demand for De Beers’ rough diamonds,” the miner explained.
Anglo American expects the production of rough diamonds for the entire year to increase from 30 million to 33 million carats to 32 million to 34 million carats.
However, due to lower copper grades and a lack of water availability in Chile, the ramp-up of the Aquila longwall in steelmaking coal, and maintenance at the Minas-Rio iron ore mine in Brazil, the London-listed miner reported a 9 percent decline in second-quarter output.
Chile, the world’s largest producer of copper and the second-largest producer of battery element lithium, is affected by a drought that has lasted more than a decade and reduced mining output.