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Anglo American (LON: AAL) reported a 5% drop in third-quarter copper production on Tuesday after extreme winter weather disrupted its Chilean operations, but the mining giant maintained its full-year output forecast.
The miner produced 174,900 tonnes of copper in the three months ended Sept. 30, down from 183,500 tonnes a year earlier. Output in Chile fell 6% to 94,200 tonnes, reflecting record snowfall, severe weather and lower ore grades at Collahuasi and El Soldado. Production in Peru declined 3% to 80,700 tonnes.
“Operational performance was resilient across the business, continuing our momentum from the first half of the year despite extreme winter weather in Chile,” CEO Duncan Wanblad said in the company’s quarterly production report. “We are on track to meet our 2026 guidance, supported by the planned improvement in copper ore grades in the fourth quarter.”
Anglo’s ability to maintain its copper targets is important as it reshapes its portfolio around the metal and prepares to combine with Teck Resources (TSX: TECK.A TECK.B, NYSE: TECK). The proposed merger would create a major global copper producer at a time when demand for the metal is expected to benefit from electrification and expanding power infrastructure. Anglo noted the deal remains on schedule for completion by March 2027, with approval from China’s antitrust regulator being the final outstanding regulatory requirement.
Copper production for the first nine months totalled 518,500 tonnes, 1% below the comparable period in 2025. Anglo maintained its annual guidance of 700,000 to 760,000 tonnes, supported by an expected improvement in ore grades at its Collahuasi and Quellaveco operations.
The company also lowered its copper unit-cost forecast to approximately 139 cents per pound from 145 cents, reflecting stronger by-product prices and cost controls, particularly in Peru.
Premium iron ore production declined 4% to 13.8 million tonnes as planned upgrades at Kumba’s South African operations offset stronger output from Minas-Rio in Brazil. Manganese production rose 6% to 1.03 million tonnes, while steelmaking coal output jumped 53% to 2.9 million tonnes.
The company is also advancing the sale of its Australian steelmaking coal assets to Dhilmar for up to $3.9 billion, while its planned nickel divestment remains under review by European regulators.
Diamond dilemma
Anglo’s efforts to streamline its business face its most difficult challenge with the planned sale of De Beers. Declining diamond prices, production disruptions and uncertainty over future ownership continue to complicate the sale of one of the industry’s best-known names.
Rough diamond production fell 11% year-on-year to 6.8 million carats in the third quarter, primarily because of planned maintenance at Orapa in Botswana and reduced activity at Venetia in South Africa ahead of a two-year production pause.
Botswana’s output declined 20% to 4.8 million carats, while South African production dropped 37% to approximately 418,000 carats.
De Beers expects further declines in the fourth quarter as maintenance at Botswana’s Jwaneng mine restricts production.
Trading conditions showed signs of stabilizing during the quarter, supported by improved consumer demand in the US and India. However, competition from laboratory-grown diamonds continued to weigh on lower-priced natural stones.
The consolidated average realized diamond price for the first nine months fell 37% to $97 per carat, reflecting an 18% decline in the rough diamond price index and a shift in the sales mix toward lower-value stones.
Third-quarter rough diamond sales reached 9.8 million carats, generating consolidated revenue of $731 million, compared with 5.7 million carats and $700 million a year earlier. The higher sales volumes provided only a modest revenue increase, underscoring the pressure on prices.
De Beers raised its 2026 production guidance to between 25 million and 28 million carats, from 21 million to 26 million previously, after assuming full ownership of Canada’s Gahcho Kué mine.
Sale under pressure
The weakening diamond market has sharply eroded De Beers’ value and raised questions about what Anglo can recover from a business it once considered a prized asset.
Anglo has recorded $6.8 billion in write-downs on De Beers over three consecutive years, including $1.6 billion in 2023, $2.9 billion in 2024 and $2.3 billion in 2025.
The company is now seeking to sell its 85% stake in a transaction that could value the business at approximately $1 billion. By comparison, Anglo paid $5.1 billion for an additional 40% interest in De Beers in 2012.
Anglo put De Beers up for sale in May 2024 as part of a broader restructuring. In July, it selected the Global Diamond Consortium, led by former De Beers CEO Gareth Penny, as its preferred bidder.
Any transaction must account for Botswana, which owns 15% of De Beers, holds pre-emptive rights and supplies roughly 70% of its rough diamonds. Minister Moeti Mohwasa has indicated that the sale could close in the fourth quarter of 2026, emphasizing the importance of experienced management and stable, long-term ownership.
The country is also strengthening its commercial relationships with major diamond consumers. President Duma Boko visited Beijing this week, where he attended the opening of a Chow Tai Fook jewellery boutique.
The proposed sale will test whether new investors and producing countries can revive De Beers amid changing consumer preferences and sustained competition from synthetic stones. For Anglo, finding a buyer would remove one of the largest remaining obstacles to its transformation into a company focused on copper, premium iron ore and crop nutrients.
