The sale of diamonds fails in Botswana, since buyers refuse to pay

Botswana did not sell diamonds in an unprecedented ad-hoc auction, since buyers refused to pay sufficiently high prices, since the global industry continues to deal with one of its deepest crises.

The state merchant Okavango Diamond Co. had offered around 1 million carats of rough stones in the “closed” tender on Thursday, which differ from the usual process of auctions for registered and scheduled buyers with quite anticipation. The objective had been to increase income for the government, Bloomberg reported that people familiar with the matter say.

But sales such as the reserve price were not fulfilled, spokesman Dennis Tlaang said on Friday. He said Thursday that ODC would not be sold at prices that would have “a negative impact on the market.”

The failed sale is even more evidence of weakness worldwide. The industry is dealing with one of its worst recessions in decades after suffering a collapse of Chinese demand and the fierce competition of laboratory cultivated stones, while US tariffs have sown more uncertainty.

Market drop is also a blow to state coffers of Botswana, one of the most important producers in the world. Diamonds, which represent 80% of the country's export sales and around a third of government revenues, have been the basis of their economy for decades.

It is likely that the country's economy is contracted for a second consecutive year in 2025, according to S&P Global Ratings, which recently reduces the long -term sovereign credit rating of the nation. The data published on Friday showed that the Gross Domestic Product fell 5.3% in the second quarter of the previous year.

Together with the lowest prices, Botswana has also faced a decrease in diamond production. Production fell 43% year -on -year in the second quarter, the greatest fall since the beginning of the pandemic, according to Statistics Botswana. He cited prolonged maintenance in a key mine and efforts to balance the supply with a weaker demand.

Debswana, the largest diamond miner in Botswana, has reduced the exit in the middle of the diamond fall. ODC is assigned 30% of the stones produced by Debswana, a 50-50 joint business between Botswana and Diamond Giant de Beers.

ODC's archived sale “is not unusual in our business and, in fact, reflects the strength of our position to maintain fair value for our product,” Tlaang said. A renewed interest in future auctions is expected, he said.