Anglo American Cuts De Beers’ Value by $2.9 Billion Amid Diamond Market Slump
Anglo American announced a significant $2.9 billion write-down of De Beers’ valuation due to challenging market conditions in the diamond industry. Following this latest reduction, De Beers is now valued at approximately $4.1 billion.
This marks the second consecutive year that Anglo American has decreased De Beers' book value, having written off $1.6 billion in 2024. Anglo American CEO Duncan Wanblad noted in the annual report that the process of spinning off De Beers as an independent entity is progressing well, with strategic steps already underway to improve cash flow and ensure long-term success.
Last May, Anglo revealed its intention to divest its 85% stake in De Beers, either through a public listing or an asset sale. Recently, Wanblad suggested to the Financial Times that an initial public offering (IPO) seems the more probable route. Meanwhile, Botswana’s government, which currently owns the remaining 15% stake, has indicated its interest in expanding its investment.
De Beers experienced a sharp 22% drop in diamond production in 2024. According to Anglo American, this decline resulted from proactive measures taken in response to persistently weak demand and high inventories of polished diamonds held by manufacturers.
The diamond market faced multiple challenges last year, including subdued consumer demand in China and cautious buying from retailers in the United States. Inventory levels in the midstream, or manufacturing segment, rose significantly in the second quarter due to these market conditions. Several diamond producers even postponed or canceled their sales events, reflecting the market’s uncertainty. By the fourth quarter, however, inventory levels stabilized, and polished diamond prices began to show signs of improvement.
Overall, Anglo American estimated that global demand for diamond jewelry decreased by about 3-4% in 2024, with U.S. demand down around 2%. The first half of the year was particularly weak, while demand stabilized in the second half.
Lab-grown diamonds also faced declining prices throughout 2024, prompting major retailers—including De Beers' own lab-grown brand, Lightbox—to offer significant discounts. Retailers even included warnings that lab-grown diamonds might not retain their long-term value. Anglo American believes that declining margins in the lab-grown diamond sector, along with rising competition and growing consumer awareness, will limit the long-term impact of lab-grown stones on the natural diamond market.
Looking ahead, Anglo has revised De Beers’ production targets downwards for 2025, forecasting between 20 million and 23 million carats. The company expects a gradual recovery in the market, with output potentially rising to 28-31 million carats by 2027.