Thursday, September 29, 2011

Botswana govt to trade diamonds independently to verify market movements

Gaborone, Botswana – What will the Botswana government do with the 10% of run-of-mine rough that it buys from Debswana – the 50:50 De Beers and Botswana government joint venture diamond-mining company – beginning this year?

Will the Botswana government pay the going rate for the rough diamonds or will it receive them at a discount?

Those were the two questions Mining Weekly put to Botswana Minerals Minister Dr Ponatshego Kedikilwe at the media conference which followed the announcement that the ten-year agreement that De Beers had struck with the government provided for an independent sales outlet for the Botswana government, which would begin this year at 10% of Debswana’s run-of-mine production and rise to 15% over a five year period.

Kedikilwe’s response is that the diamond market is changing to the extent that not only the traditional markets of the US, Europe and Japan have to be watched, but also the developing markets of China and India. In addition, there are also new private-sector company participants.

“Because we are no longer in command, to the extent that we were in the earlier years, of how the market works, we now, as government, wish to verify independently how the markets are moving.

“This is no contradiction with our partners (De Beers) and the verification window is precisely what we negotiated, so that we have an independent avenue for ourselves to judge and sniff out what the market looks like in terms of price,” Kedikilwe tells Mining Weekly.

He says the Botswana approach differs totally from the South African approach of legally forcing diamond-mining companies to sell 10% of the diamonds they mine to the State Diamond Trader, which, in turn, makes these available to emerging empowered local diamond cutters and polishers.

Instead, Botswana’s independent diamond sales outlet will be “simply to judge the market” and not to “defile – defile is probably not the word” – the market.

“The market has to be allowed to work independently,” Kedikilwe says.

“De Beers takes 90% and sells it, and we take 10% and sell it. This is a business – no discounts – and all the profits come to both of us at the end of the day,” the Botswana President’s permanent secretary, Eric Molale, explains.

Molale urges Botswana to reciprocate and to “give back to the world” by boosting the country’s productivity.

The evolution of Botswana’s diamond cutting and polishing industry started in the early 1980s with one factory. Following a policy initiative of encouraging downstream beneficiation in 2004, 16 diamond-cutting factories have since been established.

Both the government and De Beers have pledged to continue to nurture the incipient industry into fully integrated operations which do not focus only on cutting and polishing but diversify into new areas such as diamond jewellery manufacturing.

“We must be productive, both in the public and the private sectors, to support the diamond industry. We must, as a matter of urgency, change for the better our work culture and reduce on the culture of entitlement.

“We cannot just have rights. They must be complemented by accountability and responsibility. That’s what we have to give back to the world diamond industry,” Molale says, adding that Botswana needs the diamond revenue to build schools, clinics and roads and to empower its citizens.

Under the new agreement, Botswana will continue to receive 80c out of each dollar of production that Debswana sells and De Beers 20c.

Anglo American CEO Cynthia Carroll, who was present at the signing, says that De Beers, which is 45% Anglo-owned, remains core.

De Beers is currently performing well and shareholders are looking to new De Beers CEO Philippe Mellier to add value during a time of uncertainty in global economics.

Despite fiscal tightness globally, Mellier reports that demand for diamonds remains “very strong”, with a likely build-up towards the Christmas season and the Chinese New Year and the expectation that diamond consumption in 2011 will exceed that of 2010.

While the US remains the largest con-sumer of diamonds, last year China’s offtake increased by 25% and India’s by 31%.

De Beers expects China, India and the Gulf collectively to match US market share for diamonds by 2015. At the same time, demand for diamonds has increased significantly across most major markets, as consumers continue to focus on fewer but better things during uncertain times.

Move From London

Debswana has been selling its diamonds exclusively to De Beers, which, in turn, shipped the diamonds to London for aggregation and selling to its customers known as sightholders.

Now the new agreement, backdated to January 1, stipulates that De Beers must relocate its ‘sights’ and sales operations – including professionals, skills, equipment and technology – from London to Gaborone by the end of 2013.

From its new base in Botswana, the Diamond Trading Company will aggregate – parcel similar diamonds together – production from De Beers’ mines and its joint venture operations worldwide, and sell to international sightholders.

De Beers chairperson Nicky Oppenheimer says that initial consultation has begun with De Beers staff in London on the transfer of London activities to Gaborone by the end of 2013.

“It’s not going to be easy, but we are committed to it,” Oppenheimer adds.

De Beers director of strategy and new business Bruce Cleaver says the transfer process is complex, which is why a timescale has been agreed to ensure that the shift can be done in a completely seamless way, so that there is no negative impact on clients receiving regular supplies from De Beers.

“We would expect a combination of people migrating from London and, broadly speaking, we expect the numbers of people to remain constant,” Cleaver adds.

Others Looking On

De Beers has the capacity to produce 45-million carats a year and Molale expects $6-billion worth of diamonds to be traded a year in Botswana, including diamonds from Canada, South Africa, Namibia and the other countries where De Beers is involved.

On a visit to Btoswana, Democratic Republic of Congo (DRC) President Joseph Kabila spoke of the possibility of DRC diamonds being aggregated and traded in Botswana, where Lesotho diamonds are already sent and which is likely to attract the diamonds of all Kimberley Process-certified African countries in time.

“Before diamonds come here, we would want to ensure that they are clean diamonds,” Molale comments to Mining Weekly.

De Beers is no longer the only company mining diamonds in Botswana and has been joined by far smaller companies like Lucara, Firestone and others, which have begun auctioning diamonds in Botswana.

Oppenheimer sees the latest agreement with the Botswana government as being good for Africa.

“The potential’s there. One’s got to make the exciting things happen now. That’s going to require input from all sides. It’s going to require input from the government, but also from sightholders who are getting goods and working here. So the opportunity is there. Now it’s got to be grasped,” Oppenheimer comments to Mining Weekly.

On diamond exploration, Oppenheimer comments that diamond mines are extra- ordinarily difficult to find.

“You can find kimberlites, but can you find a kimberlite that’s economic and, even better, can you find a kimberlite of the nature of Venetia, Orapa and Jwaneng? They are very few and far between,” he says.

De Beers does, however, have a new diamond project in a permitting phase in Canada that Cleaver says will eventuate in a mine and it has some promising finds in Angola.

While De Beers of the past has always had a competition-authority problem in acquiring other diamond assets because of its large market share, its proportion of the world’s production is now dramatically less than it used to be and the lower it becomes, the greater the acquisition opportunity.

“We are certainly alive to acquisitions,” Cleaver tells Mining Weekly.

The world’s leading rough diamond com- pany, De Beers, which was established in South Africa in 1888, currently operates in 20 countries across six continents, employing more than 16 000 people.

Botswana’s Vision

How is the ten-year agreement expected to improve the Botswana economy in the coming years? Could Gaborone become a second Antwerp?

Kedikilwe’s response to these Mining Weekly questions is that he hopes Gaborone develops into a city better than Antwerp.

Botswana’s last beneficiation convention attracted high-level diamond leaders.

“We want to be the diamond centre of the world and we would like to turn the holes that diamond mining has punched into our ground into tourist attractions. We would like to prove to posterity that we did well with the mystique stones,” says Kedikilwe

The country now has the elaborate Diamond Trading Company (DTC) Botswana sorting and valuing centre, the 570-employee Diamond Technology Park, which is being expanded, and upgraded infrastructurally.

Because of the diamond value chain’s considerable gestation period, financial muscle is needed in order to sustain.

The Diamond Technology Park’s tenants already include ABM Amro Bank, the Gemological Institute of America, diamond cutter and polisher Safdico – whose MD is Shanee Orbach – which developed the park, Steinmetz and jeweller manufacturers including Shrenuj, which is listed in Bombay.

Kedikilwe has been on a roadshow to Antwerp in a bid to attract companies to Botswana that have the skills to mount diamonds on items like watches, as well as financial institutions.

The Minerals Minister is also intent on developing local skills to deal with small diamonds and to lower the cost environment needed to compete in the arena of small diamonds.

Safdico Botswana CEO Rutang Moses says the 124-employee company specialises in top-end diamonds and is promoting Botswana as a training centre.

“We’ve built a factory that has the com- petence, technology and skills to cut and polish big stones,” Moses adds.

A delegation of Australian diamond jewellers are scheduled to visit the Jwaneng diamond mine, in Botswana, in October, Jeweller Magazine reports.

Tolkowsky Diamonds has reportedly organised the junket to the world’s biggest diamond mine by value, on behalf of Australia’s Nationwide Jewellers.

In addition to a visit to the mine, the itinerary includes a stop at the DCT’s rough diamond sorting facility and Tolkowsky’s own diamond-cutting factory, which produces the Hearts and Arrows design.

In a press release, Nationwide Jewellers director Barry Jackson called the trip “a unique opportunity to follow the path of diamonds”.

The latest agreement, and the tangible outcomes it is expected to deliver, should thus enable Botswana to achieve its aspiration of being a major diamond centre engaged in all aspects of the diamond business, 44 years after De Beers’ geologists first discovered diamonds near what is today Botswana’s Orapa diamond mine.

De Beers’ output to peak by 2012

Diamond producer De Beers, which had cut production in 2008 and 2009 in the wake of the global recession, has begun to ramp up production and expects to reach its full production level of about 40 million carats in 2012.

Production in the first half of this year was almost stagnant, but the company started to scale up from the latter half, as global demand for rough diamonds is seen as rebounding.

“We expect to produce about 35 million carats this year (2011), as against 25 million carats in 2009. By 2012 we expect to touch our full production level,” said Mr Stephen Lussier, CEO of Forevermark, the global diamond brand from De Beers Group.

The more recent economic crisis in the US had not impacted diamond sales, while growth in Europe was weaker, he told media persons here on Thursday.

He was in the city to launch of the Forevermark brand of diamonds, tying up with local jewellers.

“We see the Indian and Chinese diamond markets together to grow to a size of one third of the world market in the next 4-5 years,” he said.

Digital marketing focus:

Mr Lussier said the company will be focussing on digital marketing for Forevermark brand in India. “Next week, we plan to launch a digital campaign involving virtual try-on. Consumers can try out different Forevermark diamonds virtually sitting before their computer with a Web cam. Diamond jewellery is a unique branding business,” he pointed out.

Wednesday, September 28, 2011

Man seeks return of US$300m diamonds

A MAN found with US$300 million worth of diamonds has filed a High Court application to have the gems returned to him following the collapse of his trial.

Newman Chiadzwa, 55, of Marange, was convicted and sentenced to five years in prison last year over the possession of 43,028 carats of diamonds.

The High Court quashed the sentence in June this year on a technicality, prompting Chiadzwa to approach prosecutors, who used the diamonds as an exhibit during his trial.

Court officials said the diamonds, weighing a total of 8.61 kilograms, had been handed over to officials from the Mines Ministry.
Chiadzwa's lawyers said Tuesday they had had no luck getting them back from the ministry.

Chiadzwa was charged with illegal possession of precious minerals and sentenced to five years in jail. He appealed against both sentence and conviction to the High Court.

At first instance, on May 18, 2010, Justice Yunus Omerjee threw out his application for bail pending review of his conviction, telling him he had little prospects of success in overturning his conviction.

But on June 29 this year, Justice Andrew Mutema passed a default judgment quashing the lower court's ruling after the Attorney General failed to file his opposition.

Last month, the Attorney General launched an appeal seeking a reversal of the default judgement and Chiadzwa’s immediate return to prison to serve out the remainder of his sentence.

The Attorney General said he had not been served with a set down notice for the June 29 hearing at which Justice Mutema passed the default judgement.

The AG also argued that Justice Mutema made the judgement without the concurrence of another judge, as provided in terms of the law.
The appeal is pending.

Tuesday, September 27, 2011

Buying in India, China may keep the sparkle in diamond

Diamond prices are headed north in the medium-term as demand from India and China together is expected to more than make up for the slackening demand from European markets, says a diamond industry expert.

“The supply of rough diamonds remains stable, but the demand — propelled particularly by Indian and China — is growing,” said Mr Stephen Lussier, CEO, Forevermark. Forevermark is a division of De Beers group of companies with an agenda of driving diamond demand in key markets and maintaining consumer confidence. And, De Beers controls over 40 per cent of the global rough diamond market.

Mr Lussier said currently, India and China account for 20 per cent of the global demand, and is expected to grow anywhere between 20 and 25 per cent every year for the next four to five years.

“At this rate, India and China would outperform the US by the end of this decade.”
Prices up 30%

He said, in the last few months the prices of rough diamonds went up by over 30 per cent. However, according to him, for the rest of the year, the prices may not go up as global diamond mining giants, including De Beers, “have decided to hold on to their current prices and supplies till the end of this year.” (According to industry sources, currently, the price hovers around $230 a carat.)

Mr Lussier was in town today to announce the Forever brand's foray into the Chennai market through tie-up with jewellery retailers such as GRT Jewellers, Joyallukkas, Prince Jewellery, VBJ Jewellers and Sugal and Damani Jewellers.

The diamond brand is currently available in cities such as Bangalore, Delhi and Mumbai.

The company is planning to step into a few other cities such as Hyderabad in the coming months, he said.

Monday, September 26, 2011

Wayne Bridge buys Frankie Sandford a £40k diamond engagement ring

The Manchester City footballer, who has been dating the singer for nine months, bought the sparkling stone ring at Graff Diamonds – just off London's Bond Street.

Said to be 3.5 carat and canary yellow, the ring is yet to be presented to Frankie.

Wayne, 31, is 'waiting for the perfect moment' to pop the question and hopes that Frankie says yes, claims the Sun - who may have now spoiled the surprise for Frankie...

The Saturdays' singer is the latest member to make a move towards settling down.

Fellow bandmate Una Healy recently announced that she is pregnant with boyfriend Ben Foden's baby.

The whirlwind romance between City star Wayne and pop star Frankie began in December last year.

Earlier this month Frankie, 22, was hinting she was keen to get married.

'I hope we do get married in the future,' she told the Daily Mirror.

'My family wouldn't be disappointed if I married him.

'He can't do any wrong in the eyes of my friends and family - they absolutely love him.'

Rockwell Diamonds sells over 3,000 carats in Q2 for over $7.0m in sales

Rockwell Diamonds (TSE:RDI) announced Monday it made revenues of over $7.0 million in its second quarter, on the sale of more than 3,000 carats from its three currently active operations in South Africa.

In total, the diamond miner produced 3,233 carats, which it sold at an average price of $2,187 per carat, for a total of $7.05 million in sales.

At the Saxendrift mine, located on the north bank of the Middle Orange River, Rockwell produced 1,740 carats, which it sold at approximately USD $3,186 per carat for $5.54 million in revenues.

Located to the northeast of Saxendrift, the Klipdam diamond field produced 1,456 carats, selling at a price of $1,030 per carat, for $1.50 million in revenues, while the Holpan mine produced 27 carats, sold at $176 per carat, for $4,755 in revenues.

CEO James Campbell said: "We are pleased that the high quality of our current production has supported higher selling prices.

"While the underlying diamond market has increased by some 25% per carat for diamonds such as those typically produced by Rockwell in the past twelve months, our average price for the quarter has more than doubled.

"This is a clear demonstration that the diamonds which we have presented for sale are of a superior quality and in high demand."

Despite slow production in June and July, Rockwell said its operations in August recovered strongly. On August 2, in particular, the company reported that it recovered 373 carats from its Saxendrift mine alone - a single-day record.

Saxendrift also produced 32 stones weighing more than 10 carats, of which 11 stones exceeded 20 carats, the company said. These stones have been passed into the company’s beneficiation joint venture with the Steinmetz Diamond Group, which delivers revenues for Rockwell’s stones that exceed 2.8 carats.

“We produced 46 stones exceeding 10 carats from our two operational mines, which included 11 rough stones weighing more than 20 carats. This is an indication that our diamond value management focus, which prioritizes the production of quality tons, is starting to pay off,” added Campbell.

Rockwell said it will disclose further details of its revenue stream and earnings when it releases its second quarter financial report around October 17.

Investors took profit as the Vancouver, B.C.-based company's shares shed 4.17% in Toronto, to $0.46 as of 2:09 pm EDT.

Sunday, September 25, 2011

Rough diamond import to remain low due to weak

Rough diamond import from April-August may have registered a phenomenal 48 per cent increase compared to previous year, but it is likely to remain low from September onwards following the weakening of the Indian rupee against dollar.

As the US dollar is an all time high, a level not seen in more than 28 months, diamond merchants in Surat and Mumbai are not willing to take the delivery of rough diamond consignments bound for India from Antwerp, Dubai and African countries.

Reason: The industry is already facing severe liquidity crisis and the cash flows are further impacted significantly as the diamond companies, especially the small and mid-sized, have to pay at the current rupee rate of Rs 50.

A diamond merchant, who had booked rough diamond consignment worth $1 million last week when the exchange rate of rupee was at 47.94 per US $ will have to pay Rs 49.67 per US $ now. The diamantaire will have to pay Rs 1.73 crore extra on the import of rough diamond consignment.

Market sources said the rough diamond parcels are parked in Antwerp, Dubai and African countries and the Indian diamantaires are paying the depreciation charges to the exporters, believing the currency may recover soon.

As per the statistics of Gems and Jewellery Export Promotion Council (GJEPC), India imported rough diamonds worth $7 billion in five months from April-August 2011 registering a 48 per cent increase compared to the same period in previous year. The import of rough diamonds in the month of August was worth $830 million registering an increase of 20 per cent compared to $689 million in the same month in previous year.

In September 2010, the diamantaires had imported rough diamonds worth $ 973 million registering a 37 per cent increase compared to $ 708 million worth of rough diamonds imported in the previous year. In 2010, India imported rough diamonds worth $ 11 billion.

"Nobody in the industry wants to take any risks. Though the prices of rough diamonds have decreased by 10-15 per cent in the last two months, the diamantaires are faced with a new set of worry about the weakening Indian rupee. Most of the diamond merchants have parked their diamond parcels overseas fearing the dollar may appreciate further in the coming days," president of Surat Diamond Association (SDA) Dinesh Navadia said.

Asked about the impact on the industry, Navadia said, "The industry may experience the rough diamond shortage in October. This will further result in the diamond workers getting less work when they will return from the Diwali vacation in November."

A diamond merchant Rakesh Gandhi said, "The industry is following the wait and watch strategy as far as the import of rough diamonds is concerned. Nobody in the industry wants to cough up extra bucks at the time when the merchants are facing liquidity crisis."

Thursday, September 22, 2011

DiamondCorp poised for next stage of development

DiamondCorp (LON:DCP) is expected to move onto its next phase of development in the coming weeks as it confirms the diamond grades from Lace kimberlite pipe, says Fairfax mining analyst John Meyer.

Today, in its interim results statement, the group said it has made significant steps towards its goal of becoming a long-term diamond producer. In recent months it has focused on the ongoing underground development programme at the Lace mine in South Africa, where bulk sampling below historic mine workings is returning encouraging results.

This initial mining operation, to recover the samples, has now reached an area of the kimberlite with higher grades that is ‘significantly better’ than on the western side of the pipe, where it encountered lower grade and stony ground at the start of the programme.

Chief executive Paul Loudon told investors that DiamondCorp is now determining the grade and carat value at the top of the first mining, block and he expect that the group will have this information next month.

“The team continue to progress the bulk sample with the last two samples showing that grade is significantly better than first estimated,” Fairfax analyst John Meyer said in a note to clients. “We can now see potential for the bulk sample to exceed 24 carats per hundred tonne on sampling of more fresh kimberlite.”

Importantly Meyer believes that the produced diamonds from the bulk sampling will be sufficient to cover a ‘significant portion’ of the mine development costs.

“The sale of stones from the bulk sample and from ongoing mining should cover a significant portion of the cost of developing the larger underground infrastructure depending on prices achieved,” he added. “New funds for full development program will need to be arranged and could include some form of banking or offtake arrangement depending on market conditions.”

Meyer points out that while there are reports suggesting weakness in diamond prices, from the recent highs in July, prices for larger gem quality stones like many of those produced from Lace may remain strong due to growing demand in Hong Kong and China.

While there are question marks over demand for smaller stones the analysts said that thankfully the Lace mine appears to be producing a very high proportion of gem quality stones compared with other mines.

Fairfax has a ‘buy’ recommendation on DiamondCorp with a 23 pence a share target price.

Also commenting on today’s results was Ocean Equities’ Christopher Welch, the analyst said: “Encountering heavily diluted ore at the start of the bulk sample was unexpected, but as we believed, once through this ground the diamond grade has recovered to exceed initial expectations.

“There are several important implications from the bulk sample results announced to date.

“First, the initial ore to report to the plant (when operational in early 2013, if not sooner) will come from the area of the pipe as these current high grades. We have based our production model for the mine on a grade of 24 carats per hundred tonnes for the early sections of the caving operation and these results give us confidence that this grade will be achieved in mining.

“The second point is that although the soft ground is heavily diluted, it still contains high quality stones. Unlike many other operations, the dilution risk for the caving operation is relatively low because this soft ore is not barren.

“This gives DiamondCorp a good operating margin during production blasting.”

Meanwhile looking at impact a potential hiccup in diamond prices, Welch added: “It must be remembered that the diamond market is ironically opaque and less efficient markets than we see for commodities in general (diamonds do not have the homogeneity to be a commodity).

“In the longer term we believe that any softness in the diamond market will be met with a flight to quality so we will back the diamond mines with the highest quality stones, of which Lace is one of a small group.”

According to Ocean Securities DiamondCorp is undervalued based on the Lace mine’s value alone, nevermind the exploration projects in Botwana near De Beer’s Jwaneng mine – the world’s ‘richest’ diamond mine.

Welch said: “investors essentially have free participation in what could be a company-making kimberlite mine in its own right. The proximity of DiamondCorp’s exploration licence to the De Beer’s Jwaneng mine indicates the value of the exploration real estate in DiamondCorp’s portfolio.”

Today DiamondCorp also highlighted that work is ongoing on the J-01 kimberlite, which spans 10 hectares, about 10 kilometres southeast of Jwaneng, and a rig is currently on its way to the smaller J-05 diamondiferous kimberlite, which is nearer to Jwaneng.

In terms of its financials the diamond mine developer reported a £1.16 million net loss (compared to a £1.6 million loss in the comparative period of last year). During the period the group raised £3.48 million of new equity which is being used to facilitate the ongoing work at Lace and at the Botswana kimberlites.

“Having successfully re-accessed the Lace mine below any of the old workings, we are now determining the grade and carat value at the top of the first mining block and expect to have this information next month,” Loudon said this morning.

“At the same time, we have commenced our mini bulk testing programme on our two diamondiferous kimberlites in Botswana and expect to have these results before the end of 2011.”

So far DiamondCorp has processed a total of 14,211 tonnes of kimberlite and from this it has recovered 1,837 carats of diamonds. The company said that it is encouraged that the diamond quality remains consistent with the initial parcel, which was valued at an average of US$205 per carat at the SA Diamond Exchange last month.

“Approximately 40 per cent of the diamonds are larger than one-third of a carat, and more than 80 per cent of the diamonds are gem quality,” DiamondCorp said. The largest gem diamond recovered is 20.54 carats, and a 1.01 carat pink diamond has just been recovered.

Wednesday, September 21, 2011

Rare blue diamond Bulgari ring fetches £1.9m after appearing at auction for the first time

The size L ring boasts an obliquely set, pear-shaped, fancy vivid blue diamond weighing 3.78 carats with the final sale price putting it at £492,000 per carat.

Only one in about 10 blue diamonds of this size has a colour pure enough to qualify as fancy vivid.

Founded in Rome in 1884, Bulgari's designs are coveted by millions and Richard Burton is alleged to have claimed that the brand name was the only word his jewellery obsessed wife Elizabeth Taylor knew in Italian.
Only one in about 10 blue diamonds of this size has a colour pure enough to qualify as fancy vivid

Only one in about 10 blue diamonds of this size has a colour pure enough to qualify as fancy vivid

Jean Ghika, Director of jewellery at Bonham's said: 'Not only was this jewel an exquisite example of Bulgari’s craftsmanship at this period, but the fancy vivid blue diamond is an incredibly rare gem in its own right.

'The sale of this magnificent ring, and the final price realised demonstrates the demand, at an international level, in pieces of this quality.'

The piece was commissioned by the private collector's father as a gift to his wife during the 1960s, when the luxury label was at the height of fashion and innovation.

Last year another blue diamond ring made by Bulgari in the 1970s set a record price selling at a New York auction house for £886,000 per carat, making it the top seller in the Christie's sale which featured over 450 items.

Diamond prices have remained relatively stable throughout the recession making them a good hedge for investors.

Jean Ghika added: 'Despite tough economic times, interest in pieces of jewellery of the highest quality is increasing.

'It is clear from the results of this sale that there are certainly some clients who are attracted by the fact that jewellery is a tangible asset which may grow in value in years to come.'

Other items also surprised auctioneers, including a rare peacock brooch set with diamonds and gems by the French Imperial jeweller Gustave Baugrand circa 1867 which made four times over the pre-sale price, selling for £56,450.

Tuesday, September 20, 2011

Useless!! UN calls for immediate truce in Central African Republic

The United Nations called for an immediate truce between rival groups in the Central African Republic fighting for control over diamond mines, in a statement sent to AFP Tuesday.

"The United Nations expresses its strong concern over the violent fighting between the CPJP and UFDR in Bria and calls for an immediate ceasefire," a statement by the UN office in the country said, urging for the conflict to be resolved "by peaceful means."

The statement deplored "the loss of human life and goods" during the clashes and called on both sides to ensure the safety of vulnerable sections of the population, especially women and children.

The fighting in Bria, a town in the centre of the country, has claimed 30 lives over the past week, a military official said Monday.

The official said the fighting pits former rebels from the Union of Democratic Forces for Unity (UFDR) against rebels of the Convention of Patriots for Justice and Peace (CPJP).

The UFDR is dominated by the Ronga and the CPJP by the Goula, two rival ethnic groups who have feuded over the region's diamond mines for years.

Bria is the country's main diamond mining hub and according to a report published last year by the International Crisis Group, the stones are fuelling the conflict.

The UFDR has signed a peace agreement and the CPJP a ceasefire but ICG said diamonds stoked a type of conflict that is best described as "banditry under a rebel flag".

Industrial mining never took off in the impoverished country and most diamonds are extracted by an estimated 80,000 to 100,000 unlicensed miners equipped with picks and shovels.

Monday, September 19, 2011

Platinum Jewelry Dominates The Red Carpet at The 63rd Primetime Emmy Awards Read more: Platinum Jewelry Dominates The Red Carpet at The 63rd Primetim

From Gwyneth Paltrow‘s stackable bracelets to Julie Bowen‘s black diamond drop earrings, Hollywood‘s leading television actresses chose to celebrate their achievements with enduring platinum jewelry at the 63rd Primetime Emmy Awards.

Platinum is naturally white, so it never changes color or fades, thereby maximizing the brilliance of diamonds and colored gemstones. It is the ideal setting for the red carpet, and all of life’s most important moments.

Following is a list of stars that celebrated tonight’s achievements in PLATINUM:

Gwyneth Paltrow: Platinum earrings with black and white diamonds (7 carats), two platinum and diamond bracelets (100 carats total), and a platinum ring with diamonds and black onyx (5 carats) by Neil Lane.
Drew Barrymore: Platinum and diamond earrings by Van Cleef & Arpels.
Julie Bowen: Platinum earrings with black and white diamonds, platinum bracelet with diamonds and onyx, and several platinum rings with black and white diamonds by Neil Lane.
Minka Kelly: Platinum and diamond drop earrings, and platinum rings by Tiffany & Co.
Gretchen Mol: Platinum earrings with jade, onyx and diamonds, multiple vintage platinum bracelets with diamonds, jade and black enamel, and a platinum and diamond ring (12.90 carats) by Fred Leighton.
Nina Dobrev: Platinum and diamond stud earrings by Neil Lane.
Jayma Mays: Platinum and diamond bow brooch in her hair (10 carats), platinum and diamond cluster earrings (10 carats), and a platinum and diamond ring (5 carats) by Neil Lane.
Cat Deely: Platinum and diamond ea rrings (14 carats), multiple platinum and diamond bracelets (37 carats total), and a platinum and yellow diamond ring (20 carats) by Bvlgari.
Colbie Smulders: Platinum and diamond earrings, platinum ring with diamonds and aquamarine, and a platinum bracelet with diamonds and aquamarine (50 carats) by Neil Lane.
Kaley Cuoco: Pla tinum and diamond stud earrings, and a platinum and diamond bracelet by Kwiat.
Amber Riley: Platinum and diamond earrings (6 carats), and a platinum and diamond ring (13 carats) by Chopard.
Mireille Enos: Multiple platinum and diamond bracelets (97 carats total), and a platinum and rose-cut diamond ring (14 carats) by Chopard.
Maria Bello: Platinum and diamond stud earrings, and a platinum and diamond ring by Martin Katz.
Taraji P. Henson: Art Deco platinum and diamond earrings, and a platinum dome ring with rock crystal and diamonds byFred Leighton.
Ellie Kemper: Platinum and diamond stud earrings (8 carats) by Chopard.
Giuliana Rancic: Platinum and diamond earrings (22 carats), and multiple platinum and diamond bracelets (43 carats) by Chopard.

About Platinum Jewelry

Platinum is the ideal choice for red carpet jewelry because it holds diamonds and precious gemstones more securely than any other metal. It is not only the highest quality metal, but its density makes it one of the most durable and enduring precious metals. Platinum is also naturally white, unlike white gold, which means it will not cast any tint onto a diamond or gemstone, allowing the stone’s genuine color to sparkle brightly.

Read more: Platinum Jewelry Dominates The Red Carpet at The 63rd Primetime Emmy Awards |
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Petra Diamonds profits up

London-listed Petra Diamonds on Monday reported earnings per share of 12.83 US cents for the year ended June 2011 from 22.65 cents a year ago, after the issue of 136.7 million new shares in January 2011.

The diamond miner reported revenue rose to US$220.6 million from US$163.7 million, while profit from mining activity rose to US$76.4 million from US$67.2 million.

EBITDA amounted to US$67.1 million from US$70.9 million (which included a profit of around US$35 million due to the sale of the 507 carat Cullinan Heritage diamond.) Profit after tax declined to US$59.2 million from US$70.2 million

Production of 1,117,795 carats was lower than the 1,164,856 carats produced in 2010 due to Petra's strategic focus on 'value production', the planned cessation of main pit production at Williamson, the planned depletion of Optical Sort Plant tailings material at Cullinan, initial commissioning difficulties at Kimberley Underground and unseasonably heavy rainfall in South Africa, it said.

The company said expansion plans on target to increase production to around 4 million carats (Mcts) by FY 2014 and to over 5 Mcts by FY 2019.

It noted that diamond prices rose steadily from October 2010 to highs in June 2011.

Petra has acquired the world-class Finsch mine from De Beers for R1.425 billion, with the deal completed post period-end on 14 September. After an initial three month bedding down period, Finsch is expected to add 125,000 carats per month to Petra's output, adding at least 1 Mcts for FY 2012

Petra Diamonds CEO Johan Dippenaar said over the last year, Petra further consolidated its position as one of the world's largest quoted diamond mining groups.

“We have a high quality portfolio of production assets and expansion plans underway which will drive our exceptional growth profile. The fundamentals of our industry are strong; whilst the global supply of diamonds remains constrained, demand continues to rise in both established and new markets.

“With the completion of Finsch and the proposed move up to the Main Market of the London Stock Exchange, I am very positive about the future for Petra in the 2012 financial year and beyond,” he said.

The LSE Main Market step-up is expected by the end of December.

“Although recent economic uncertainty has led to an adjustment in rough diamond prices since Period-end, the long-term outlook remains positive due to strong supply and demand fundamentals,” the group said.

De Beers to shift diamond trading business to Botswana from London

De Beers, which produces more than a third of the world's diamonds, has agreed to move sorting and trading of the gems to Botswana by the end of 2013, ending an arrangement for sales in London that's been in place since 1888.

The move is part of a 10-year deal signed on Monday with the Southern African nation in the capital, Gaborone. The agreement ensures De Beers' continued access to diamonds from the country, which produces more of the gems by value than any other, and will mean increased revenue and jobs for Botswana.

De Beers sorts diamonds by value in London and holds sales in the city every five weeks, attended by about 75 buyers from Antwerp, Israel and India, among other regions. De Beers' trading arm, called Diamond Trading Co., sold $3.49 billion of rough, or uncut, diamonds in the first half of the year.

"De Beers should benefit from a longer agreement as it removes the periodic disruption in having to wrestle with a new pact every five years," Des Kilalea, an analyst at RBC Capital Markets in London, said in an e-mailed note. "In a world with looming tightness in rough diamond supply, the certainty of a long-term agreement over the world's largest source of rough is welcome."

Under the agreement, Botswana will sell local production to the market for the first time, initially 10% of its output, rising to 15% over the next four years. That provides the country with its own price verification system, Mines minister Ponatshego Kedikilwe said.

De Beers' trading arm will also increase the value of diamonds it makes available to manufacturing companies in Botswana to $800 million a year from $550 million, the company said in a statement handed to reporters on Monday. The agreement is effective from January 1 this year. The new marketing arrangement is, on a net basis, probably neutral for De Beers, chairman Nicky Oppenheimer said in an interview.

Anglo American, which owns 45% of De Beers, "believes in diamonds," chief executive officer Cynthia Carroll said.

Sunday, September 18, 2011

New funds target expected rise in diamond prices

With diamonds fast becoming best friends to growing numbers of luxury lovers in China and India, industry experts are setting up funds to help investors benefit from rising demand and prices for the stones.

After launching a first fund in May, diamond miner and retailer Harry Winston Corp is considering a follow-up with its partner Diamond Asset Advisors (DAA). Martin Rapaport, whose diamond price list is an industry benchmark, is also working on a fund project for next year.

"I think that over the long term there will be a strong appreciation of diamond prices based on increasing luxury demand from India, China and the Pacific Rim," said industry expert Rapaport, adding that a weak dollar would also increase diamonds' appeal as a safe-haven for investors.

Broader demand and a consequent improvement in liquidity should support diamond prices over the longer term, making such funds attractive, although the horizon is cloudy in the near term, some market watchers said.

Des Kilalea, an analyst at RBC Capital Markets, said he was generally confident about the upwards trend for diamond prices over the longer term. "In a normal market, I would expect very good demand (for DAA's fund), but in the current volatile environment, forecasts are difficult," he said.

Peter Laib, former head of private equity firm Adveq and now chairman of DAA, said diamond supply was unlikely to grow in coming years given that no new mine had been discovered and even if that happened, it would take years to exploit it.

Harry Winston and DAA this spring signed a deal for a fund of up to $250 million. It will buy diamonds sourced by Harry Winston's experts and consign them to the jewelry company that will thus have additional stock to open new stores and boost its growth without spending its own cash.

"Harry Winston would be interested in a second fund with DAA," said the company's Chief Operating Officer Ray Simpson.

"If there is strong appetite from investors for the first fund, the second could be launched immediately after the first sometime next year. The additional diamonds would also be available for Harry Winston to use and would further support our growth plans," said Simpson, who is going to join DAA soon.

DAA's fund is structured as a private placement, meaning its managers cannot give any indication on how subscriptions are going. "The interest is huge," fund director Claudio Ghisu said.


But past experiences have shown diamond prices are not immune to the state of the global economy. The first diamond investment trust, set up by investment firm Thomson McKinnon in the 1980s, was wound up after a slump in the market.

And Diamond Circle Capital Plc, the first publicly listed fund to invest in diamonds, has been treading water since it lost more than half of its value in the 2008 crisis.

First signs of a possible temporary slowdown may be already visible. "Certified polished diamond prices fell in August as cautious buyers reacted to economic uncertainty and Indian suppliers faced tight liquidity," Rapaport said in a report.

Also, institutional investors such as pension funds may be deterred by the fund's exclusive focus on one asset category and the lack of transparent market prices.

"The product sounds interesting but we would be very cautious," said Willi Berger, a fund manager at the public pension fund of the Swiss canton of Grisons. "The unilateral focus on diamonds would rather put us off."

Aware of the problem of opaque diamond prices, DAA said the structure of the fund could offer a solution. "The fund is very liquid: every time Harry Winston sells a diamond, we have a trade. This enables us to establish a price book," Ghisu said.

The Rapaport Group will introduce a diamond price index allowing the financial sector to monitor the price of diamonds on a daily basis, the group said last month.

De Beers to Deal in Botswana

The world's largest producer of rough diamonds, De Beers SA, is moving a key sales unit to Botswana from the U.K., highlighting how African governments are pushing miners to expand beyond mineral extraction in order to create additional local jobs.

African governments want miners to create more local jobs. Above, uncut diamonds at De Beers in London.

Under an agreement signed Friday, De Beers will move its London-based rough-diamond sales activity and as many as 150 jobs to Botswana's capital, Gaborone, by the end of 2013 . De Beers said it is still assessing the cost of the move and declined to disclose whether it will entail additional investment in the southern African nation.

As part of a new 10-year sales pact, the Botswana government also will have the right to sell 10% of diamonds mined in the country from a local joint venture between it and De Beers. Currently De Beers's trading arm sells all the output.

Botswana is the world's largest source of the precious stones, accounting for 21% of global diamond-mine production and about two-thirds of De Beers's output. The government of Botswana maintains a 15% stake in the company.

"It has long been a desire of the Botswana government to maximize its position as a leading diamond producer," said Bruce Cleaver, the executive director for strategy and business development at De Beers.

African governments have been trying to diversify their economies and add jobs beyond the extraction of precious stones and minerals to cushion any downturn in commodity prices. They have urged foreign miners to invest in sectors that add value to what comes out of the ground, such as polishing diamonds or refining platinum and gold.

Neighboring South Africa, the world's largest producer of platinum, is hoping to follow Botswana's example. South Africa's Department of Mineral Resources is drafting legislation aimed at encouraging miners to open more refining and manufacturing operations involving what is mined in country. In Zimbabwe, another major platinum producer, Impala Platinum Holdings Ltd. said it is considering opening a plant to refine locally mined ore; however, it is waiting until there is a clearer outlook for the implementation of a law requiring miners to sell a 51% stake in their enterprises to government-designated black-owned entities.

De Beers's Diamond Trading Co. will mix production from its mines and its global joint-venture operations to sell from its new base in Botswana. That will require big diamond buyers from India, Israel, the U.S.—and increasingly China—to come to Botswana. Currently, most of De Beers's diamonds are sold at meetings the company hosts in London.

"The agreement gives us direct access to market, which will be helpful for the successful development of the downstream diamond industry in Botswana," said Ponatshego Kedikilwe, the country's minister of mines, energy and water.

Such a trend is expected to ripple more broadly through the economy of Botswana, one of the most stable countries in southern Africa, to boost tourism and other sectors.

Botswana relies heavily on diamond mining for revenue. During the 2008 financial crisis, demand for diamonds dropped. That forced the Botswana government and De Beers mining venture, Debswana, to idle some mines for months at a time. Revenue from diamond sales in Botswana went from $366 million in 2008 to $193 million in 2009, before rising to $482 million in 2010.

Wednesday, September 14, 2011

Petra assumes management of Finsch diamond mine

Petra Diamonds has completed the R1.43-billion acquisition of the Finsch diamond mine in South Africa from De Beers Consolidated Mines and will assume management with immediate effect.

The mine would more than double Petra’s production, adding 1.5-million carats a year to the group’s output, it said on Wednesday.

Petra would boost its production to four-million carats by 2014 and to more than five-million carats by 2019.

Finsch adds an eighth producing mine to the Aim-quoted group, which plans to migrate to the London bourse’s main market.

“Finsch is an ideal addition to our portfolio, contributing a world-class mining operation with exceptional infrastructure, a major carat base and a sustainable, long-life outlook for the duration of our initial 18 year mine plan,” commented CEO Johan Dippenaar.

Rough diamond prices could plateau - DTCB

Diamond Trading Company Botswana (DTCB) expects rough diamond prices to flatten later this year, following a record-breaking performance in 2011 during which the gemstones rose by 35 percent on strong retail demand.

According to the Bank of Botswana and Statistics Botswana, diamond exports rose nearly every month this year, frequently touching record territory on the back of positive supply/demand dynamics.

For the first seven months of the year, diamond exports, which for Botswana include both polished and rough stones, were at a historic high of P20.5 billion, echoing the robust trends seen in jewellery auctions across the world. The emergence of diamonds as a safe haven for investors in the Middle East also buoyed demand while the record-breaking performance also attracted speculative buyers who also contributed to the positive demand.

However, while announcing last week that it had held its largest ever sale in July, DTCB cautioned that going forward prices could plateau as evidenced by recent auctions for polished diamonds and jewellery in India. Says DTCB in the latest edition of an in-house publication.

"DTCB recently celebrated its largest ever diamond sale. The market for gem goods has sustained a significant period of growth in rough diamond prices which has been driven in part by a healthy demand for polished diamonds by traders and retailers, and a perceived general shortage of diamonds in the short- to medium-term.

"The latest diamond show in India seems to suggest that rough prices are approaching saturation point as the market plateaus. We watch with anticipation the effects, if any, of the current global economic developments on the diamond market." In line with policy, DTCB officials declined to detail the size of their July auction, although its parent company, the London-based Diamond Trading Company (DTC), recorded a mammoth US$850 million (P5.7 billion) sale for the same month. DTCB's sales are figured into DTC's, together with similar auctions from South Africa and Namibia.

From the Indian International Jewellery Show (IIJS), indications were of a smoothening out of the sharp rise seen in diamond prices across the rough, polished and jewellery categories.

The five-day IIJSS that wrapped up on August 8 and provides a platform for the diamond trade, noted downward pressure from some buyers, indicating a slight change in market dynamics.

Said Daxesh Doshi, an executive with a diamond polishing firm, in a statement: "This year the show has been good, though the quality-conscious buyers want to buy four to five percent lesser than the usual prices.

"I guess it's because of the price point related both to gold as well as diamonds. The buyers are a bit apprehensive about the international market, but I feel that the domestic scenario is just too good." However, DTC CEO, Varda Shine, said while prices could flatten, there were signs of upward potential nearer the Chinese New Year in December. China and India have emerged as fast-growing diamond consumers, although the US remains the single most important destination for the precious stones.

"Not only are we seeing more demand from a greater variety of sources, we are also seeing new types of demand, or a different consumption rationale evolving," Shine said in a recent interview with diamond guru, Chaim Even-Zohar. "As investors have been stung by the volatility of less tangible investments, the price of gold and diamonds as hard assets and diversifiers of risk in investment portfolios has grown.

"The financial investors have - quite correctly so - seen the strong fundamentals of the diamond industry, identified the clear opportunity that exists here and are very eager to put their money in diamonds."

Tuesday, September 13, 2011

Peregrine Diamonds: Field Work at Chidliak Finished for the Year

This year’s field work at the Chidliak Diamond Project on Baffin Island in Nunavut, Canada, has been successfully completed, Peregrine Diamonds announced this week.

One major objective of the program was to continue the detailed exploration of kimberlites with economic potential in preparation for bulk sampling, which aims to extract roughly 200-carat diamond parcels per kimberlite to support independent diamond valuations. The bulk sampling program is scheduled to launch next winter.

Another objective this past season was to find new kimberlites, and with the recent discovery of CH-59, nine kimberlites were discovered this year bringing the current number of known kimberlites at Chidliak to 59.

New microdiamond results from CH-7 and CH-28 confirm previously reported coarse diamond size distributions, while the CH-17, CH-51 and CH-55 kimberlites all yielded commercial-size diamonds. Diamond results from 10 kimberlites are expected in the coming months.

“Our goal is to deliver the first diamond mine on Baffin Island,” said Peregrine CEO Eric Friedland.

Monday, September 12, 2011

Diamond activist barred from leaving

Farai Maguwu an activist who has campaigned for an international ban on diamonds from Marange was stopped from leaving Harare on Saturday after having his passport seized.

Farai Maguwu, the point man for an international diamond lobby against Zimbabwe diamonds, was due to attend a two-day conference which began on Monday in Ireland.
But his lawyers say his airline boarding pass was seized along with his passport, laptop and personal notebooks.

Denford Halimani, his lawyer, said Maguwu's luggage was taken off the plane and also "tampered with."

Maguwu was jailed for five weeks earlier this year for allegedly releasing information on alleged killings and violence in eastern Zimbabwe's controversy-mired diamond fields.
He was scheduled to speak at the Dublin Platform for Human Rights Defenders Sept. 14-16.

No official explanation was given. Lawyers immediately sought a court ruling allowing him to travel. A decision was expected on Monday.

Rio Tinto’s Murowa Eclipsed by Mbada as Zimbabwe’s Biggest Diamond Miner

Murowa diamond mine has been eclipsed as Zimbabwe’s largest gem producer by Mbada Mines (Pvt) Ltd. after the closely held miner increased output, according to its chairman, Robert Mhlanga.

Mbada, based in the capital, Harare, is producing more than 150,000 carats a month from its operations at the Marange diamond fields in eastern Zimbabwe, he said in an interview in the city on Sept. 7. That compares with 250,000 carats a year at Murowa, according to the company’s website.

“Our vision is to be the leading gem producer globally,” Mhlanga said. De Beers, which vies with Russia’s Alrosa as the world’s largest diamond miner, aims to produce to about 35 million carats this year, the company, a unit of Anglo American Plc, said on July 26. A carat is a fifth of a gram.

Mbada is one of four companies mining diamonds at Marange, where Human Rights Watch has accused Zimbabwean authorities of killing local villagers and illegal miners. In 2008, more than 200 people were killed when security forces seized the Marange fields, according to the New York-based group. Zimbabwe’s government has rejected the accusations.

Rapaport Group’s RapNet Diamond Trading Network, the world’s biggest, in November banned its members from dealing in gems from Marange because of reports of “severe” human rights violations in the area.

In January, Zimbabwe was given permission to hold two diamond auctions this year by the Kimberley Process, an international body set up to control the sale of conflict gems, Deputy Mines Minister Gift Chimanikire said.

Annual income from the Marange field could rise to $2 billion if the country is allowed to export gems freely, Mines Minister Obert Mpofu said, according to a report in the state- controlled Herald newspaper in October last year.

Mbada’s Mhlanga declined to say how many diamonds are currently being produced at the Marange fields.

Sunday, September 11, 2011

Elizabeth Taylor's prized passion

Christie's will soon auction top pieces from Elizabeth Taylor's jewellery collection. The stories behind the dazzling pieces are just as priceless

Elizabeth Taylor dazzled the world with her beauty, lavish lifestyle — and an unquenchable passion for diamonds and jewels that was fuelled by the great loves of her life.

The late Hollywood star amassed one of the foremost jewellery collections in the world, including a 33.19-carat diamond ring and a 16th-century pear-shaped pearl from one of her seven husbands, Richard Burton.

Christie's auction house will sell her complete jewellery collection, valued at $30 million (Dh110 million), in New York on December 13-14.

"These are the jewels that Elizabeth Taylor received from the loves of her life, Mike Todd and Richard Burton," said Christie's jewellery expert Rahul Kadakia. "They're from moments in life that were dear to her," jewels that were bought at Bulgari in Rome, at Cartier in New York and at auctions.

The stories behind them are as priceless as the gems. In a 2002 memoir, My Love Affair with Jewelry, Taylor took readers on a personal journey of her collection, describing how she came to own each piece.

"I never, never thought of my jewellery as trophies," she wrote. "I'm here to take care of them and to love them. When I die and they go off to auction I hope whoever buys them gives them a really good home."

It's an extraordinary collection of rubies, diamonds, emeralds and sapphires in intricate and bold designs.

Among the standouts is the 16th-century La Peregrina, one of the largest and most symmetrically perfect pear-shaped pearls in the world, which Burton purchased for Taylor in 1969 as a Valentine's Day gift.

The two had met in Italy on the set of the 1963 film Cleopatra, and married for the first time in 1964.

The journey of the gem

Once part of the Crown Jewels of Spain, the pearl later passed into the hands of Joseph Bonaparte, Napoleon III and the Duke of Abercorn.

When it came up at auction in New York, Burton snapped it up for $37,000 (Dh135,900), beating out the underbidder, a member of the Spanish Royal family. Cartier later created a ruby and diamond necklace from which the pearl was suspended, a design that was inspired by the Velazquez portraits of Spain's Queen Margarita and Queen Isabel wearing the pearl as a necklace.

Taylor, who was married eight times — twice to Burton — died in March. She was 79. The couple appeared together in about a dozen films.

In 1972, Burton purchased the 17th-century Taj Mahal diamond pendant for Taylor's 40th birthday. The transaction took place at John F. Kennedy International Airport because the couple didn't have time to run into the city before catching a flight, Kadakia said.

The heart-shaped diamond is associated with one of history's greatest love stories. It belonged to Emperor Shah Jahangir, who had the diamond inscribed with his wife's name "Noor Jahan". He later passed the stone on to his son, Shah Jahan, who built the Taj Mahal in memory of his wife Mumtaz, who died during childbirth.

Cartier later recreated the diamond's original silk cord as a gold rope-like necklace set with rubies and diamonds. The necklace has a pre-sale estimate of $300,000-$500,000 (Dh1.1 million-Dh1.8 million).

"Jewellery was a way of life for Elizabeth Taylor. They were her friends. She enjoyed wearing them because they reminded her of the great moments in her life, the great places in her life," Kadakia said.

Like the time Taylor's third husband, theatre and film producer Mike Todd, gave her a Cartier box as she sat by the pool at a rented villa in the south of France. Inside was a ruby necklace, matching earrings and bracelet.

"She was so happy that she jumped into the pool wearing all this jewellery and started doing laps," Kadakia said.

One of the most extravagant gifts Taylor received from Burton was the asscher-cut 33.19-carat diamond set in a platinum ring. Known as the Elizabeth Taylor Diamond, Kadakia said its size and clarity makes it a perfect gem. Burton purchased it in 1968 at a New York auction for $305,000 (Dh1.12 million).

"Elizabeth Taylor used to refer to it as her baby and wore it as often as she could," said Kadakia, including in nearly all her subsequent films.

Thursday, September 8, 2011

Harry Winston Q2 profit slips to US$10M; revenues up US$68.7M

Harry Winston Diamond Corp. (TSX:HW) is predicting continuing strong global demand and prices even as the diamond miner and luxury jewelry retailer saw sharply reduced profits in the second quarter.

Toronto-based Harry Winston reported after markets closed Wednesday that net earnings attributable to shareholders in the three months ended July 31 were US$10 million or 12 cents per share, compared with US$13 million or 17 cents in the same quarter a year earlier.

Revenue in the company's fiscal 2012 second quarter were US$222.4 million, up from $153.7 million, mainly as a result of sparkling results in it luxury brand retail segment.

Mining revenue totalled US$89.6 million in the quarter, up from US$86.8 million, while the luxury segment produced revenues of US$132.8 million, almost double the US$66.9 million generated in the year-earlier period.

"Global retail demand, especially in the emerging economies such as China and India, has delivered both strong retail sales growth and strong rough diamond prices," company chairman and CEO Robert Gannicott said in a release accompanying the results.

"Seeing through the effect of a small number of high-value, lower margin sales, our own jewelry and timepiece business shows solid growth in both sales and margin in the core bridal, timepiece and designed jewelry segments," Gannicott added.

Meanwhile, he said the market price increase in rough diamonds had "more than compensated" for two complete sales versus three in the comparable prior-year quarter as well as the lower quality diamonds mined.

"Looking forward we continue to see strong global jewelry and timepiece demand from China, while Japan and the Middle East improve and the U.S. remains subdued," Gannicott said.

"On this basis we expect to continue to grow our own jewelry and timepiece business despite challenging economic conditions in the U.S. and Europe."

Although the company does not predict further near-term price increases in the rough diamond market, "we do see our own rough diamond sales price already improving as we produce more from the higher valued A-154 South and North pipes," Gannicott said.

Harry Winston supplies rough diamonds to the global market from its 40 per cent ownership interest in the Diavik diamond mine in the Norhwest Territories. while its luxury segment operates salons in key locations in major cities around the world.

On the Toronto Stock Exchange, Harry Winston stock closed down 23 cents at $14.80 Wednesday.

Saif gets wedding ring for Kareena?

It seems wedding bells are finally going to ring for Bollywood’s hottest couple Saif Ali Khan and Kareena Kapoor. The wedding preparations have, reportedly, already begun and Saif has supposedly ordered an exquisite diamond ring for the love of his life.

Is Saif ring shopping for his ladylove?
Rumours claim that wedding preparations are in full swing in both the families. Ace designer, Ritu Kumar, is already working hard to create a magnificent, one-of-a kind wedding ensemble for the ravishing actress.

With the wedding ensemble supposedly being created, our Chote Nawab is also trying his best to make the D-day all the more special for his ladylove. Saif ordered a unique selection of diamonds from a jewellery store based in Bandra.
“Saif had asked for a selection of diamond rings from this jeweller based out of Bandra. They sent him rings of different cuts and carats. He had asked for princess cut diamonds and also a few other shapes,” a reliable source divulged. Saif is said to have selected the special ring for his ladylove after going through a series of designs before he got the perfect one, an exquisite 4-5 carat diamond ring.

Saifeena planning a February wedding?

With rumours of the impending marriage between the hottest couple of Bollywood already generating quite a stir, speculations are skyrocketing regarding when the pair would actually end up exchanging marital vows. A close source said, “Kareena and Saif are ready to tie the knot in February next year. In fact, Saif had started ordering various designs of rings for a while now. He took his time deciding on the perfect ring for his girl and finally took the one he liked about a week back.” Meanwhile, the pair is currently busy shooting for their upcoming flick together “Agent Vinod.”

Namakwa Diamonds Rises After Naming Chairman, Getting Funds

Namakwa Diamonds Ltd. a miner of the gems in Africa, jumped the most in 2 1/2 years in London trading after naming a chairman and reaching a funding accord.

Namakwa climbed 2.75 pence, or 26 percent, to 13.25 pence at the 4:30 p.m. close, the biggest one-day gain since January 2009. The Johannesburg-based company appointed Edward Haslam as chairman and named Alex Davidson as senior independent non- executive director, it said today in a statement.

The company also said it reached an agreement with Jarvirne, the investment vehicle of industrialist Eduard Prutnik, on funding for its kimberlite mining project at Kao in Lesotho.

Wednesday, September 7, 2011

Relief for Indian jewellers as US diamond market bounces back to peak level

The S&P downgrade of US may not impact the Indian diamond industry as the latest data published by the US department of commerce has boosted the size of US jewellery industry by about 5 per cent, restoring it to its former level of $65 billion in the peak sales year of 2007. This news will may come as a relief to the $43 billion worth of Indian gems and jewellery industry.

As per the official statistics by the Gems and Jewellery Export Promotion Council (GJEPC), India exports about 35 per cent of the polished diamonds and jewellery to the US worth $12 billion per annum. In 2010-11, India exported polished diamonds worth $28 billion and about $9.30 billion were exported to the US.

The global jewellery market is $145 billion in size and 40 per cent of the jewellery is consumed in US, making it one of the biggest jewellery markets of the world followed by Hong Kong, China, India, UAE etc.

Vice-chairman of GJEPC Sanjay Kothari told TOI, "Gems and jewellery is an export-oriented sector and the S&P downgrade of US had worried the diamantaires. But, the latest data of US government would boost the confidence of diamond and jewellery exporters in India." According to the US department of commerce, the latest industry sales database revision in early August has restored the jewellery industry to its former pinnacle of $65 billion, a level reached in 2007. The data also showed that jewellery sales declined by about 11 per cent during the great recession of 2008-2009 with the total jewellery market pegged at $62 billion.

The export of polished diamonds for three months from April-June has increased by 10 per cent at $6.5 billion compared to $5.5 billion during the same period in the previous year. In June 2011, the polished diamond export did not gain much enthusiasm and it was up just one per cent to $2.22 billion compared to same month in the previous year, while in July 2011 the polished diamond export declined by 5 per cent at $1.9 billion compared to $2 billion in same month in previous year.

If the diamantaires are to be believed, then in the post-recession scenario, the US is still the top export destination for the industry, but a part of the demand has been offset by other emerging markets like Middle East, China, Hong Kong, Kazakhstan, Brazil and Russia.

Industry sources said that pre-recession, about 50 per cent of the polished diamonds and jewellery were exported from India to US. However, the global economic downturn in 2008 changed the phenomenon and that the diamantaires started exploring new markets, including India.

Director of Sanghavi Export Aagam Sanghavi told TOI, "The US is no longer the price driver for polished diamonds for Indian manufacturers, which it used to be pre-recession. Post-recession, people have started doing more sensible business and this is the reason why new markets have been explored in the past couple of years to offset the US market."

Elizabeth Taylor's $30m of gems up for auction

There was jewellery for the eight wedding days, the numerous film premieres, the table tennis victories and of course Tuesdays. Who among us does not get an 'it's Tuesday and I love you' gift?

The woman who certainly did was Elizabeth Taylor and it helped her build up one of the most remarkable and dazzling private collections of jewellery ever created.

Following her death in March aged 79, Christie's announced on Wednesday it is to sell nearly 300 of the star's jewels over two sessions in New York. There will be diamonds, pearls, emeralds, rubies and sapphires; rings, earrings, necklaces, brooches, tiaras and more in a sale expected to make over $30m (£19m).

The chairman and president of Christie's America, Marc Porter, said the sale promised "to captivate the auction world". He added: "This is without a doubt the greatest private collection of jewellery assembled in one place."

Taylor's obsession with jewellery is well-chronicled. Her twice-husband Richard Burton said: "I introduced Liz to beer, and she introduced me to Bulgari."

If your jaw would ever drop at a piece of jewellery then it would drop at some of the gifts from Burton, not least "the Elizabeth Taylor Diamond", a 33.19 carat monster of a diamond ring that she cheerfully wore most days after being given it in 1968.

Taylor once said: "My ring gives me the strangest feeling for beauty. With its sparks of red and white and blue and purple, and on and on, really, it sort of hums with its own beatific life."

Its estimate may be a tad beyond most means – $2.5m to $3.5m.

Burton was also responsible for "It's a beautiful day, I love you" gifts and an "It's Tuesday, I love you" present of a Bulgari emerald suite – necklace pendant, ring, bracelet, earrings – collected over the course of many trips to the Bulgari boutique on Rome's Via Condotti while they were filming Cleopatra. He is alleged to have claimed "the only word Elizabeth knows in Italian is Bulgari".

Then there is his 1968 Christmas present to her which she almost missed because Burton had buried it so deep in her Christmas stocking. The perfect red ruby ring is estimated at $1m to $1.5m.

Two years later Burton and Taylor were relaxing at their luxury chalet in Gstaad playing ping pong. A challenge was set: if Taylor could take 10 points off him he would get her a diamond, and of course she did. The result was three very small diamond rings known as the ping pong diamonds, which may be more in some people's price range at $5,000 to $7,000.

Another Burton gift is a necklace – La Pérégrina – which contains one of the most important pearls there is, one discovered in the early 1500s in the Gulf of Panama which Philip II of Spain gave as a wedding gift to his wife Mary Tudor.

Of course Taylor went through her husbands, and there are gifts in the sale from others, including husband number three Mike Todd, who died in a plane crash a year after their marriage in 1957. She wore the diamond tiara he gave her – "you are my queen" – to the Oscars in 1957, where Todd won best picture for Around the World in 80 Days.

Another present was the Cartier Ruby suite which he surprised her with as she was swimming laps in the pool of her luxury Saint-Jean-Cap-Ferrat villa. She was without a mirror and looked at her reflection in the pool and wrote afterwards: "I just shrieked with joy, put my arms around Mike's neck, and pulled him into the pool after me."

It will be a sale the like of which has not been seen since Sotheby's sold Wallis Simpson's vast collection of jewellery by the shores of Lake Geneva in 1987. Taylor was, naturally, at the sale, outbidding everyone to buy the "Prince of Wales" brooch that she admired whenever she saw the duchess.

Other pieces in the sale relate to specific films such as her diamond, gold, emerald and sapphire Night of the Iguana brooch which always brought to mind lovely days spent at her Mexican residencia in Gringo Gulch, Puerto Vallarta – joined, as it was, by a bridge to Burton's.

Taylor always intended that her collection would go to auction. In her 2002 memoir, My Love Affair With Jewellery, Taylor wrote: "I never, never thought of my jewellery as trophies. I'm here to take care of them and to love them. When I die and they go off to auction I hope whoever buys them gives them a really good home."

François Curiel, Christie's international jewellery director, recalled first meeting Taylor in 1998: "It was clear that she possessed an expert's eye for craftmanship, rarity, quality and history. She collected the best pieces from the best periods, and as a result her collection boasts exquisite examples from the most celebrated of jewellery designers."

Tuesday, September 6, 2011

Diamonds look to offer fresh haven appeal

Diamonds are a girl’s best friend but the big question is whether they can also be the same for investors.

Several groups are hoping that the answer is yes and are putting together funds for investors looking to gain exposure to diamonds.

Martin Rapaport, whose firm conducts monthly auctions, plans to launch a fund. Meanwhile, Resolution founder Clive Cowdery is investing in Diamond Capital Fund, which is closing this week with about $12m in investments.

The pitch is simple: for investors who have maxed out their exposure to gold, try diamonds as an alternative shiny hard asset and haven.

Investors looking for exposure to diamonds in the past bought the stones through jewellers, or invested in shares of companies that produce or trade them, including Tiffany and miners such as Gem Diamonds or Petra Diamonds.

Diamonds are priced individually according to the 4C’s – carat, colour, cut and clarity – and there are tens of thousands of price categories. The top end diamonds have always been regarded as investments and priced mostly like art, as no two diamonds are the same.

However, the sharp increase in demand from emerging markets has widened the breadth of what is regarded as “investment grade”.

Supply and demand point to a rise in diamond prices. Wealthy Chinese and Indian consumers as well as those from the Middle East provide most of the growth.

On the supply side, there have been no new discoveries of large diamond mines, and developing a new mine takes 10 to 12 years.

Diamond prices have jumped in the past year, thanks to Asian demand, with rough and polished diamond prices hitting record levels. The value of top quality polished diamonds of 5 carats, or 1 gramme, have risen to about $150,000 a carat, up from about $100,000-$120,000 a year ago. De Beers recently said it earned more from its diamonds in the first half of the year than any prior interim period.

There are a few reasons for caution. Adjusted for inflation diamond prices are far below their 1980s peak. The track record of diamond funds, which offer exposure to the stones without having to buy the gems, has been far from glittering.

Unlike a fund which will buy and hold a diamond on behalf of an investor, Diamond Capital’s adviser Peter Langdon says managers of the new investment fund will buy and sell the gems through an existing network of diamond jewellery retailers, depending on market prices.

Des Kilalea, analyst at RBC Capital Markets, warns the market has stalled and banks, which provide credit to polishers and wholesalers, are less keen to lend money. “The market will stagnate in the next six months,” he says.

Investors lured by the sparkling stones might want to remember an alternative saying: “Diamonds are a girl’s best friend and a man’s worst enemy”.

Maryland company set to auction large yellow diamond

A Maryland company is set to auction off a large yellow diamond — known as the "Golden Eye" — that was seized in a federal drug and money-laundering investigation. The minimum starting bid: $900,000.

Bid4Assets, based in Silver Spring, is set to auction the diamond for the U.S. Marshals Service. Bidding will start Tuesday and end Thursday.

The 43.51-carat diamond belonged to a northeast Ohio businessman who was convicted of money laundering and conspiracy. Prosecutors said he tried to sell to an undercover FBI agent the diamond and an estate once owned by boxer Mike Tyson, all for $19.5 million and a boat.

The gem was seized in the sting operation and forfeited to the federal government. It is believed to be one of the largest internally flawless yellow diamonds.

Monday, September 5, 2011

Botswana Bushmen drink from reopened borehole

Botswana -- Survival International says Botswana's Bushmen are drinking water from a borehole in the Kalahari desert for the first time in nine years.

It is a significant victory against the government that once evicted them from their ancestral lands.

The government capped the well at Mothomelo in 2002 to help force the tribe out of an area rich in diamonds.

In 2006 a court ruled the eviction illegal. But few Bushmen returned because the only water available was in handmade sand depressions.

Only in January did a court rule that the Bushmen have a fundamental right to water.

Survival International said Monday the Mothomelo well was re-drilled and a solar pump installed by Vox United charity working with Gem Diamonds, which mines in the Bushmen's lands.

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Sunday, September 4, 2011

Diamond cheaper after 40% rally in 6 months as BHB Billiton and Petra Diamonds cut rough prices

Diamond lovers can loosen their purse strings this festive season.

Rising cost of funds and a consequent fall in raw material demand among processors have cut polished diamond prices by 10% at least over the past three-four weeks, six months after they rose by a whopping 40%.

The industry attributed the relentless price rise partly to heightened speculation in roughs, the raw material, and a widening demand-supply gap, itself a consequence of an investor shift from stocks and currencies to diamonds, being increasingly perceived as an alternative asset class.

"Polished prices have come down by an average 10% across the board, and may be more in smaller products like star melees," said Pooja Kotwani, India MD of Rapaport, a leading source of diamond price information.

"Tight liquidity in the local market and a drop in interdealer (from cutter to cutter) rough transactions with people not willing to pay the premiums they had done earlier have contributed to the correction, which is a healthy sign as the price run up was perceived to be unsustainable.

I think products in oversupply and where there is a lack of demand will correct further, though it's hard to put a figure on the extent of a likely fall from here."

India's central bank has raised its so-called repo rate, at which it lends to banks, eleven times over the past year to temper rising inflation levels. Currently at 8%, this increases the borrowing cost and reins in speculative activity in commodities and other assets.

Apart from investors who bought roughs to gain from price appreciation, some stockists also hoarded them in anticipation of higher prices. This also created an artificial scarcity in the market.

But the bad news is be that even though diamond prices have come off a bit, a greater correction may not materialise since Diamond Trading Company (DTC), mining giant De Beers' roughs distribution arm that supplies nearly half of the world's rough diamonds, marginally raised prices at last week's sight or sales meet.

A sight is where DTC allots raw material to its sightholders or polished diamond manufacturers.

So, smaller producer BHP Billiton's reduction in rough prices by 15% at its recently-concluded auction may not help much, say some in the trade.

"While BHB Billiton and Petra Diamonds have reduced rough prices by 15% at recent auctions, both De Beers and Russia's Alrosa have not cut prices, which indicates rough demand remains buoyant across the world," said Vasant Mehta, a Mumbai-based diamond cutter.

"Polished prices are currently down by 5-7%, which is good for demand that typically rises in the second half of the year."

Varda Shine, MD, DTC, which holds sights 10 times a year, told ET, "Although we don't comment in detail about our monthly sales figures, it would certainly be true to say that we recorded very strong sales at both sights, both of which are among the largest sights we've ever sold, and both of which responded to exceptionally strong customer demand."

Despite economic worries in the US and Europe, De Beers expects consumers there to turn to diamonds. "In dollar terms, we are expecting the US to continue to grow this year, following on from the 7% market growth we observed there in 2010. We anticipate a steady performance from other mature markets of Europe and Japan, and strong growth in the emerging markets. Increasingly, we are seeing consumers turning to diamonds as one of the ultimate 'hard assets' in troubled times," said Shine.

Eleven out of 12 diamonds sold internationally are cut and polished in India, which registered a rise of 10% in cut and polished diamond exports to $6.5 billion during the April-June period from a year earlier.

Thursday, September 1, 2011

De Beers holds diamond prices to calm market

In order to restore confidence in the Indian diamond industry, especially among the diamantaires in Surat, the global diamond mining giant De Beers and the Canadian diamond producers have decided to maintain their current prices and supplies until the end of the year, hinting that the prices of rough diamonds will not increase.

Varda Shine, CEO of Diamond Trading Company (DTC) - a rough diamond marketing arm of the global mining giant De Beers group - has said in her interview to Israel-based diamond consultancy firm Tacy Limited that the company has no plans to increase the rough prices till the end of this year. Tacy Limited is one of the oldest and most reliable diamond consultancy firms.

"The DTC has taken the unusual step of declaring that it does not plan to increase prices in the near future. This should deter speculators from renewing speculative purchases and reassure those inclined to sell in a panic that there is really no reason to do so," Shine has been quoted as saying.

Shine said that in the first half of this year, the DTC sold $ 3.5 billion worth of rough diamonds and prices increased at an average of 35 per cent. Then, the DTC eased up on its price rises in the last two sights.

TOI had reported on August 31 that the 15 to 20 per cent reduction in the rough prices by Australia-based BHP Biliton, a small firm compared to DTC, had shaken the confidence of the diamanatiares, who are already facing severe liquidity issues.

Industry experts said that if the rough diamond prices increase by 50 per cent, manufacturers need to raise additional money to buy roughs and that this requires bank financing. Diamantiares have to pay cash for the purchase of rough diamonds, while they sell polished diamonds on the 90 to 120 days credit. During the 2008-09 recession, banks in India provided long credit lines, however that stream slowed down, and therefore traders are suffering from

liquidity problems. As a result, prices of polished diamonds started declining to generate a cash flow and finance rough diamond purchases.

Recently, the technical correction in the rough diamond prices by 15-20 per cent in the diamond tender by Australia-based BHP Billiton shook the diamond industry, especially the diamantaires who are in dire need of cash. Fearing the rough prices may further decrease ahead of the Christmas buying, most of the polished diamond traders started selling their inventories by compromising their profit margins.

"In the first half of this year, the rough prices have increased by 50-60 per cent but the polished prices are moving up on a very slow pace," said Dinesh Navadia, president of Surat Diamond Assocation (SDA). "Polished prices are still 15-20 per cent below the prices of roughs, and are supposed to move up," added Navadia.

"Knowing that the price of roughs won't decrease and that there is reason to believe that that holiday season, Chinese New Year and Diwali sales will be large, have no doubt that we can be optimistic and sure that the market will stabilize," said a DTC sightholder.