Diamond exports fell by about 61% in September, causing the country’s trade balance to break a six-month streak of surpluses and slip to a P3.9 billion deficit, Statistics Botswana figures show.
Diamond exports as recorded by the data agency, fell to P2.4 billion in September, from P6.2 billion in August, underlining the sharp drop in both demand and prices for the precious stones seen this year.
The country’s trade balance or the relationship between imports and exports of goods, was in surplus between March and August, held up generally by strong copper exports and the residual robust diamond performance from 2021 and 2022.
However, the latest Statistics Botswana figures show that the diamond downturn is now reflecting on the trade figures. The poor diamond export figures in September led to a P2.6 billion deficit for the third quarter, the first quarterly negative this year.
Diamond sales are under pressure this year from global economic weaknesses, a softer than forecast rebound in China and industry reputational concerns amongst consumers due to Russia/Ukraine conflict. The strong demand of 2021 and 2022 has met these factors and resulted in a glut or oversupply in the market at retail level.
Economists associate prolonged trade deficits with depletion of countries’ foreign reserves, weakening of currencies and stronger need for external debt.
The latest figures however also show that copper continues to enjoy a sterling year, with exports up to the third quarter amounting to P4.8 billion, about 20% above the full year figures recorded last year. Exports of the base metal have been helped by the mainstreaming of production at Khoemacau since it produced its first concentrate in July 2021, as well as the commissioning this year of Sandfire’s Motheo Mine.