Botswana is witnessing the worst decline of its diamond production in seven years, figures from Statistics Botswana show. In his latest report, statistician general, Dr Burton Mguni, explained that the report, which uses 2013 as a reference year with data sourced from the Department of Mines under the Ministry of Mineral Resources, Green Technology and Energy Security, shows that Index of Mining Production(IMP) stood at 85.6 during the third quarter of 2019, showing a year-on-year decrease of 1.8% from the index of 87.1 recorded during the third quarter of 2018.
Comparison on a quarter-on-quarter basis shows a decrease of 0.4%, from the index of 85.9 realised during the second quarter of 2019 to 85.6 registered during the third quarter of 2019.
The report presents quarterly Indices of Mining Production (IMP) for the period 2012 to the third quarter of 2019. Also carried in the report are the annual IMP for the period 2012 to 2018, derived as the average of the four quarters of the year. Mguni’s report further shows the contribution of each mineral and mineral group to the Year-on-Year Percentage Change in the Volume of Mining Production, and hence reflects the trend in the local mining sector.
Statistics Botswana, which is mandated to compile data on industrial production in Botswana, hence index of mining production is only confined to minerals extracted across the country, explained that it monitored the performance of the mining sector in Botswana.
Mguni said the IMP stood at 85.6 during the third quarter of 2019, showing a year-on-year decrease of 1.8% from 87.1 during the third quarter of 2018.
“It is worth noting that all minerals have registered negative year-on-year growth rates in the third quarter of 2019, as a result of unstable commodity prices. Diamonds and soda ash were the main contributors to the negative growth of the index of mining production, having contributed negative 0.7 and negative 0.4 of a percentage point respectively,” said Mguni. The quarter-on-quarter analysis shows a decrease of 0.4%, from the index of 85.9 during the second quarter of 2019 to 85.6 observed during the reference period.
He said diamond production decreased by 0.7% during the third quarter of 2019 compared to the same quarter of the previous year.
“Although diamond production dropped, it is important to note that the decline resulted mainly from planned strategy to reduce bulky production in order to align production with trading conditions,” said Mguni.
He said even though there was a decline in production between the third and second quarters of 2019, there was a sign of improvement as the current decrease was at a reduced percentage of 0.7 compared to the 4.2% fall between the first two quarters of the same year. Gold production declined by 1.0% during the third quarter of 2019 compared to the same quarter in 2018. The quarter-on-quarter analysis reflects a decrease of 2.9% during the third quarter of 2019 compared to the second quarter of 2019. This decline was as a result of lower than expected gold recoveries from the ore.
Soda ash production decreased by 20.5% during the third quarter of 2019, compared to the same quarter of the previous year. The decrease in production can be attributed to the inefficiency of the plant to operate at full capacity during the course of the year. That being said, the quarter-on-quarter analysis shows that production increased by 49.2% during the period under review.
Mguni further explained that the increase was a result of the need for stockpiling in order to avoid commodity shortfalls that may be realised during the shutdown periodic salt production declined by 17.2% during the third quarter of 2019 compared to the same quarter in 2018. The quarter-on-quarter comparison shows a decline of 0.2% during the third quarter of 2019 compared to the preceding quarter.
Coal production dropped by 28.6% during the third quarter of 2019 compared to production registered during the same quarter of the previous year. The decline was mainly as a result of low uptake by Morupule B Power station which has resumed remedial works on the boilers.
Although production fell, there was no shortfall in supply of coal due to stockpiling undertaken during the previous months. The quarter-on-quarter comparison, likewise, reflects a decrease of 23.5% when compared to the preceding quarter. Copper-nickel-cobalt matte, copper in Concentrates and silver recorded zero production during the period under review. The instability and uncertainty of commodity prices affected production at the associated mines, leading to provisional liquidation as mining operations could not be sustained at the current prices.