Graff Diamonds pulls HK IPO on failing investor demand

LONDON-BASED jeweller Graff Diamonds said that it had decided to postpone its $US1 billion initial public offering (IPO) in Hong Kong owing to adverse market conditions that hurt demand.

Graff's is the largest IPO to be withdrawn in Asia so far this year, amid a string of pulled share sales in recent days. Car dealer China Yongda Automobiles Services Holdings shelved its Hong Kong IPO earlier this week, which had been expected to be worth up to $433 million, while mining firm China Nonferrous Mining postponed its $313 million deal. In Singapore, M&L Hospitality Trusts called off its IPO last month.
The IPO of the ultra high-end jeweller founded by Laurence Graff in 1960 was being closely watched as the company is set to be the latest foreign firm to list in Hong Kong after Italian luxury house Prada went public in the city.
Hong Kong was the world's top venue for IPOs in the last three years, but so far this year, the $US1.8 billion offering by Chinese brokerage Haitong Securities has been the city's top deal. Graff's IPO had been seen as a high-profile test of investor appetite new shares.

But concerns about Europe's debt crisis and weak market performances have been hurting investor appetite for new listings. Hong Kong's benchmark Hang Seng Index is down more than 10 per cent this month.
According to reports, Graff managed to obtain orders for only half of the shares that it intended to offer.
The postponement of Graff's IPO also comes as diamond ring specialist Tiffany & Co cut its outlook for the year, citing lower sales growth in the US.
"The company enjoyed high quality engagement on its business and strategy from a very broad range of prospective investors. However, consistently declining stock markets proved to be a significant barrier to executing the transaction at this time," Graff said in a press release.
Graff had priced its shares at $HK25 to $HK37 each, translating to 18 to 24-times 2012 forecast earnings and valuing the company at up to $US4 billion.
The company had been due scheduled to price the deal on Friday and to list on the Hong Kong stock exchange on June 7.
Rothschild is the financial advisor on the Graff IPO, while Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC and Morgan Stanley were bookrunners.

Synthetic versus natural diamonds: HRD Antwerp helps you to tell the difference

HRD Antwerp has developed a compact screening device, “D-screen”, which distinguishes natural from potentially synthetic colourless or near-colourless polished diamonds. For the large majority of near colourless polished diamonds on the market, D-Screen guarantees that the diamond is not-synthetic and not-HPHT treated. For the number of stones that are referred for further examination, an additional investigation in a reliable laboratory is necessary.

For the most part, rough synthetic diamonds can be visually distinguished from their natural counterparts by their external shape. However, this visual identification is no longer possible after the diamond is polished. Even the study of inclusions using a microscope does not provide a conclusive answer.

The production of synthetic diamonds started in the 1950s, and they now comprise over 95% of the industrial diamond market. Synthetic diamonds of gem quality were already present in small quantities on the gem diamond market in the 1970s. It has only been recently that synthetic diamonds have begun to really impact the gem diamond market.

HRD Antwerp has invested significantly in know-how and technology to identify these synthetic stones.

But while a well-equipped grading lab has all the necessary instruments to conclusively identify synthetic diamonds, their sophisticated equipment is not readily available to the individual diamond trader. Therefore, HRD Antwerp developed a compact screening device for traders to use in their office or elsewhere. By screening the diamonds, “D-Screen” can distinguish between natural diamonds and potentially synthetic or treated ones. The instrument tells whether a diamond passes the test or is recommended for further examination in the diamond lab. 

NOTE: The  “D-screen” is  NOT designed for Laboratory work.

Taylor gets 50 years

 A UN-backed war crimes court has sentenced former Liberian president Charles Taylor to 50 years in prison for arming Sierra Leone rebels in return for "blood diamonds". 
 
"The trial chamber unanimously sentences you to a single term of imprisonment for 50 years on all counts," said Special Court for Sierra Leone judge Richard Lussick at the court based just outside The Hague today.

"The accused has been found responsible for aiding and abetting some of the most heinous crimes in human history."

Taylor, 64, dressed in a smart dark suit, white shirt and golden tie, listened with his eyes closed and a drawn face as the judge handed down the sentence, which Taylor can appeal.

The former president was convicted on April 26 on all 11 counts of war crimes and crimes against humanity for aiding and abetting Sierra Leone's Revolutionary United Front (RUF) during the country's 1991-2001 civil war.

In return, the court said, Taylor was paid in diamonds mined by slave labour in areas under control of rebels who murdered, raped and kept sex slaves while hacking off limbs and forcing children under 15 to fight.

Members of the International Diamond Manufacturers Association mourn death of IDMA Honorary President Jacques Roisen

Antwerp, Belgium - May 30, 2012: Moti Ganz, President of the International Diamond Manufacturers Association (IDMA) issued a statement, on behalf of the entire IDMA membership, mourning the death of Jacques Roisen, who passed away on May 26. Roisen served as IDMA president from 1991 to 1996 and was also an IDMA Honorary President. "Many do not realize it, but Jacques Roisen was one of the industry giants on whose shoulders we stand," Ganz said. "He belonged to that unique generation of diamond manufacturers who helped rebuild our industry after World War II and was instrumental in shaping its post-war identity and its ensuing growth and success. His energy, insights and contributions to the Diamond Manufacturers and Importers Association of America (DMIA), which he led for many years,  and to IDMA under his presidency, will not be lightly forgotten.  He will be missed by all the people he touched during his long life and his impressive and fruitful career," Ganz added.   Meanwhile, IDMA Secretary General Ronnie vanderLinden, who is also a DMIA Vice President, said: "Everybody respected Jacques. His career has been amazing. Fleeing from the Nazi destruction in Europe, he arrived in New York from Antwerp and quickly re-built his life, soon to become one of the key representatives of New York's diamond industry, dedicating himself to its growth and success, for the benefit of the entire diamond district."

Biggest Pink Diamond to Appear at Auction Sells for $17M

The biggest pink diamond ever to appear at auction sold for 17.3 million dollars on Tuesday, after tense bidding at Christie's spring jewelry auction in Hong Kong.
 
The stunning diamond was given the name "Martian Pink" by American jeweller Harry Winston to celebrate the first satellite mission to Mars by the US in the same year. In 1976 the 12.04-carat fancy intense pink diamond was purchased by a private collector. Initially expected to sell for around 8-12 million dollars "Martian Pink" blew its presale estimate out of the water.
While most natural pink diamonds have a tinge of purple, grey or orange to them, this stone shows no trace of a secondary color.
The "Martian Pink" diamond is one of the only two significant sized round pink diamonds in the world.
The other is the 23.60-carat Williamson Pink diamond, which was presented to Queen Elizabeth II in 1947 as a wedding gift.

Secondly, a pair of 10.88-carat, D, flawless brilliant-cut diamonds sold to an asian private for $4,845,456. The third top lot, a 6.04-carat, Burmese ruby ring (pictured below) by Etcetera sold for $3,330,768, fetching a world auction record per carat for a ruby at $551,000.
Vickie Sek, the director and head of jewelry and jadeite at Christie’s Asia, said, ''The $80 million auction was highlighted with top prices across the board, culminating in a world record price of $551,000 per carat for a perfect Burmese ruby of 6.04 carats.''
Another highlight of the sale included a diamond ring by JAR, which sold for $2,970,128 and featured an oval-cut 10.67-carat and two pear shaped diamonds of 6 carats, all were D, IF.

Other top lots included a 3.11-carat, VVS1 intense pink rectangular-cut diamond that sold for $2,032,464; a 14.37-carat, D, IF pear that sold for $1,960,336; and an 11.85-carat, D, potentially IF diamond ring by Harry Winston that also sold for $1,960,336.

Diamond Tiara Highlights a Royal Auction at Christie's London

Diamond tiara from the late Countess of Dudley, also known as the actress and dancer Maureen Swanson. Estimate: $156,850 – $235,270

With the ongoing celebration of Queen Elizabeth’s Diamond Jubilee, it seems fitting that Christie’s London sale of Important Jewels on June 13 would focus on royal and aristocratic jewels.
A total of 368 lots include jewels from the collections of Princess Soraya Esfandiary Bakhtiary, Beatrice Countess of Granard OBE, and the late Countess of Dudley. Spanning four centuries, the sale has rare historic rings, diamonds and pearls. The roll call of signed jewels by the leading houses and designers includes: Boucheron, Cartier, Chaumet, Chopard, Graff and Van Cleef & Arpels.
One of the top pieces of the sale is an Art Deco diamond tiara by Cartier (pictured above) from the collection of the late Countess of Dudley, also known as the actress and dancer Maureen Swanson, with an estimate of £100,000 – £150,000 ($156,850 – $235,270). It is one of 17 jewels offered from the collection up for sale. The tiara is “composed of five graduated shield shaped clip brooches, each resembling the Pylon, the tapering monumental towers of ancient Egypt whose bold form inspired so much 1930s design,” Christie’s said. “Together, mounted atop the simple diamond line frame, these clips are transformed into a modern soaring geometric skyline, their design recalling both the architectural innovations of the era together with its inimitable style.”
The sale also will be led by the Cowdray Pearls, a rare natural pearl necklace, composed of a single row of thirty-eight graduated natural grey pearls, with an estimated price of £280,000 – £350,000 ($440,000 – $549,000). It is from the collection of the late Viscountess Cowdray, Lady Pearson (1860-1932).
Leading the small group of jewels formerly from the collection of Princess Soraya Esfandiary Bakhtiary is a 12.15 carat diamond circular single-stone ring (estimate: £70,000 – £100,000; $110,000 – $156,850). Another ring with notable provenance is an Edwardian sapphire and diamond ring, circa 1905, which was formerly in the collection of Beatrice Countess of Granard OBE (estimate: £30,000 – £40,000; $47,000 – $63,000).
A selection of 40 lots from Cartier, including jewels, cufflinks, watches and clocks, is a highlight of the auction. This portion of the sale is led by an Art Deco diamond and gem bracelet of Oriental inspiration, circa 1925 (estimate: £100,000 – £150,000; $156,850 – $235,270), and a pair of platinum and diamond ear pendants, composed of a graduated line of three brilliant-cut diamonds, suspending a pear-shaped diamond drop (estimate: £100,000 – £150,000; $156,850 – $235,270).

Sierra Leone diamond town lacks old lustre

It has been weeks since miner Sembo Sesay found a diamond in this eastern Sierra Leone town, whose soil was once littered with the stones that fuelled one of Africa's bloodiest wars.
"Diamond no there," he laughs, his voice tinged with disappointment as he examines the "shaker" after plunging the sieve repeatedly into a muddy pool, muscles taut with exertion as he expertly swirls the water.
Every day just after sunrise, men carrying shovels and sieves set out for the gruelling task of digging, lifting and sifting waste sand for only 3,000 Leones ($0.69) a day in Koidu.
But the lustrous gems are few and far between these days.
"We are really worried if we don't see anything, there is no other job. We need the diamonds to survive," Sesay, 27, says.
On the other side of town, Koidu Holdings, a mining company owned by Israeli diamond magnate Beny Steinmetz, is testing a new plant built to process the diamonds from its two vertical kimberlite mines as part of a $150 million (115 million euro) expansion plan.
Small-scale artisanal mining has sustained this area since diamonds were discovered in 1930, and it was here that the 968.9-carat Star of Sierra Leone -- the largest alluvial diamond ever found -- was mined in 1972.
But surface diamonds are nearly depleted and only capital-intensive mining can now uncover the gems.
Koidu suffered some of the worst ravages of Sierra Leone's war in the nineties as rebels forced citizens to mine at gunpoint.
Residents speak of streets dug up and houses demolished at even a hint they were sitting on diamonds.
These gems were smuggled to Liberia -- whose former president Charles Taylor was last month convicted of aiding and abetting Sierra
Leone rebels in exchange for diamonds -- and Guinea, making their way onto ring fingers across the globe while rebels used the weapons they bought to sow terror.
Prosecutors have sought an 80-year sentence for Taylor in the first judgement against an ex-head of state by a world court since the World
War II Nuremberg trials.
Once one of the most powerful men in west Africa, Taylor will be sentenced on May 30 by a court based in The Hague.
Since a ban on the sale of Sierra Leonean diamonds was lifted in 2003, the country has taken pains to clear its image as a provider of "blood diamonds" and erase memories of the civil war in which several thousands were killed or had their limbs amputated.
Koidu now supplies US jewellery icon Tiffany & Co and Steinmetz is planning to float the mine on the Hong Kong stock exchange later this year, according to the Financial Times business newspaper.
However 10 years after the war, Koidu has little to show for its diamond wealth.
Dusty and desolate, it is reminiscent of an 1800s mining town, lined with diamond trading offices -- mostly Lebanese-owned -- and clapped-out stores selling shovels and sieves for those still hoping to try their luck.
Koidu is a seven-hour journey from the capital Freetown, the last half of which on a bone-rattling dirt road with potholes so large that ducks waddle over from mud-hut villages to swim in them after a downpour.
Amid the glaring poverty, much hope rests on Koidu Holdings' presence in the town, but many are unhappy with the lack of visible development, while the resettlement of communities close to the plant has caused friction.
In 2007 government shut the plant for a year after riots left two people dead.
Now, hundreds of colourful houses, schools and a free health clinic opened in 2011 by the vice-president of Tiffany & Co have sprung up for the resettled households.
Patrick Tongu of the local NGO Network Movement for Justice and Development says frustrations are still high.
"These communities where diamond mining is done are the most deprived areas. You see poverty in the air," Tongu said. "There is nothing to show."
As part of a law passed in 2010, all mining companies working in Sierra Leone have to give one percent of their annual turnover to community development projects but the first tranche of this has yet to reach Koidu.
Diamond revenues make their way back to the community through the traditional paramount chief, who is elected for life.
"It is left with the chief if he has a good heart to do some projects, some of them are doing that, but very few. So the monies are largely not used for the intended purpose," says Tongu.
Alpha Kpetewama, development adviser for the Tankoro chiefdom and economist, says the presence of Koidu Holdings is the only way to lift this community out of poverty.
But he admits: "We have not been very successful in managing the high expectations of the community."
Over 90 percent of staff are locals, but one company cannot employ an entire town.
"Many of the ordinary citizens, uneducated, will not begin to understand or appreciate until they begin to see tangible development on the ground ... this has yet to happen," says Kpetewama.
At another artisanal mine, called Number 11, scores of men rhythmically dip their sieves into muddy pools.
They are mostly ex-fighters who were given old tailings to sift through after the war to "distract them from evil deeds", says Musa Sawaneh, 40, who is perched on a motorbike overseeing them.
"Sometimes you go one month without finding a diamond," he says.
Former enemies from different factions in the war now mine side by side.
"We are happy, but we are hungry ... just surviving," says a former combatant.It has been weeks since miner Sembo Sesay found a diamond in this eastern Sierra Leone town, whose soil was once littered with the stones that fuelled one of Africa's bloodiest wars.
"Diamond no there," he laughs, his voice tinged with disappointment as he examines the "shaker" after plunging the sieve repeatedly into a muddy pool, muscles taut with exertion as he expertly swirls the water.
Every day just after sunrise, men carrying shovels and sieves set out for the gruelling task of digging, lifting and sifting waste sand for only 3,000 Leones ($0.69) a day in Koidu.
But the lustrous gems are few and far between these days.
"We are really worried if we don't see anything, there is no other job. We need the diamonds to survive," Sesay, 27, says.
On the other side of town, Koidu Holdings, a mining company owned by Israeli diamond magnate Beny Steinmetz, is testing a new plant built to process the diamonds from its two vertical kimberlite mines as part of a $150 million (115 million euro) expansion plan.
Small-scale artisanal mining has sustained this area since diamonds were discovered in 1930, and it was here that the 968.9-carat Star of Sierra Leone -- the largest alluvial diamond ever found -- was mined in 1972.
But surface diamonds are nearly depleted and only capital-intensive mining can now uncover the gems.
Koidu suffered some of the worst ravages of Sierra Leone's war in the nineties as rebels forced citizens to mine at gunpoint.
Residents speak of streets dug up and houses demolished at even a hint they were sitting on diamonds.
These gems were smuggled to Liberia -- whose former president Charles Taylor was last month convicted of aiding and abetting Sierra
Leone rebels in exchange for diamonds -- and Guinea, making their way onto ring fingers across the globe while rebels used the weapons they bought to sow terror.
Prosecutors have sought an 80-year sentence for Taylor in the first judgement against an ex-head of state by a world court since the World
War II Nuremberg trials.
Once one of the most powerful men in west Africa, Taylor will be sentenced on May 30 by a court based in The Hague.
Since a ban on the sale of Sierra Leonean diamonds was lifted in 2003, the country has taken pains to clear its image as a provider of "blood diamonds" and erase memories of the civil war in which several thousands were killed or had their limbs amputated.
Koidu now supplies US jewellery icon Tiffany & Co and Steinmetz is planning to float the mine on the Hong Kong stock exchange later this year, according to the Financial Times business newspaper.
However 10 years after the war, Koidu has little to show for its diamond wealth.
Dusty and desolate, it is reminiscent of an 1800s mining town, lined with diamond trading offices -- mostly Lebanese-owned -- and clapped-out stores selling shovels and sieves for those still hoping to try their luck.
Koidu is a seven-hour journey from the capital Freetown, the last half of which on a bone-rattling dirt road with potholes so large that ducks waddle over from mud-hut villages to swim in them after a downpour.
Amid the glaring poverty, much hope rests on Koidu Holdings' presence in the town, but many are unhappy with the lack of visible development, while the resettlement of communities close to the plant has caused friction.
In 2007 government shut the plant for a year after riots left two people dead.
Now, hundreds of colourful houses, schools and a free health clinic opened in 2011 by the vice-president of Tiffany & Co have sprung up for the resettled households.
Patrick Tongu of the local NGO Network Movement for Justice and Development says frustrations are still high.
"These communities where diamond mining is done are the most deprived areas. You see poverty in the air," Tongu said. "There is nothing to show."
As part of a law passed in 2010, all mining companies working in Sierra Leone have to give one percent of their annual turnover to community development projects but the first tranche of this has yet to reach Koidu.
Diamond revenues make their way back to the community through the traditional paramount chief, who is elected for life.
"It is left with the chief if he has a good heart to do some projects, some of them are doing that, but very few. So the monies are largely not used for the intended purpose," says Tongu.
Alpha Kpetewama, development adviser for the Tankoro chiefdom and economist, says the presence of Koidu Holdings is the only way to lift this community out of poverty.
But he admits: "We have not been very successful in managing the high expectations of the community."
Over 90 percent of staff are locals, but one company cannot employ an entire town.
"Many of the ordinary citizens, uneducated, will not begin to understand or appreciate until they begin to see tangible development on the ground ... this has yet to happen," says Kpetewama.
At another artisanal mine, called Number 11, scores of men rhythmically dip their sieves into muddy pools.
They are mostly ex-fighters who were given old tailings to sift through after the war to "distract them from evil deeds", says Musa Sawaneh, 40, who is perched on a motorbike overseeing them.
"Sometimes you go one month without finding a diamond," he says.
Former enemies from different factions in the war now mine side by side.
"We are happy, but we are hungry ... just surviving," says a former combatant.

Trade Warning Issued IGI

Large volumes of undisclosed man-made diamonds are believed to have entered the market after several hundred stones were sent to laboratories in Antwerp and Mumbai to be certified as natural diamonds.

· Mostly F to J Color, Clarity VVS – VS. Internal characteristics were feathers,

pinpoints, small dark crystals. The inclusions are strikingly similar to natural

inclusions, hence, microscopic observation is insufficient to conclude.

· Sizes ranged from 0.30 ct to 0.70 ct.

· Polish, Symmetry and Cut were either “Excellent” or “Very Good”.

· Bruted or faceted girdles.

· They were all type IIa and were referred as such by DiamondSure.

· When tested using DiamondPlus all the synthetics gave a “refer CVD” result.

· When viewed in DiamondView they showed bluish green fluorescence and blue

phosphorescence, with characteristic striations.

· The synthetics showed moderately strong photoluminescence from H3 and

nitrogen-vacancy optical centres (zero-phonon lines at 503 nm and 575/637 nm

respectively).

· They also exhibited photoluminescence at 737 nm that is attributed to siliconvacancy

centres.

· Absence of any laser inscription.

DCLA

CVD synthetic diamonds, diamonds triple treated to avoid detection and diamonds recut to match higher grade GIA reports being traded without disclosure. Kudos to IGI for detecting and exposing  CVDs. We advise buyers to require “Natural  Untreated Diamonds” be included on all invoices. Rapaport trade Alert!

Tiffany's Sales +8%, Comps +4% and Profit Flat

Tiffany & Co. reported that its first quarter revenue rose 7.6 percent year on year to $819.2 million for the period that ended on April 30, 2012. Same-store sales worldwide rose 4 percent. Cost of sales jumped 10 percent to $350.2 million and gross margin as a percentage of sales fell to 57.3 percent from 58.3 percent one year ago. Profit was flat at $81.5 million or 64 cents per share.
While sales were only 3 percent higher in the Americas at $386 million, Tiffany & Co. reported a solid 16 percent increase --at a constant exchange rate-- for sales in the Asia-Pacific region at $195 million, and a 13 percent jump in revenue for Japan at $142 million. Sales across Europe rose 7 percent as measured by local currency to $88 million. Same-store sales at a constant exchange-rate in the Americas fell 1 percent and in Europe they dropped 4 percent from one year ago, however, comparable-store sales rose 10 percent for Asia-Pacific and 12 percent for Japan. 
Michael J. Kowalski, the chairman of Tiffany & Co.,  said, "In terms of our sales for the first quarter, regions outside the Americas performed generally as expected. However, the Americas region underperformed, continuing a soft trend that began in the last quarter of 2011 and compounded by the difficult comparison to substantial sales growth in last year's first quarter. These sales results led to net earnings modestly trailing our expectations."
Tiffany's net inventory increased 27 percent year on year to $2.2 billion in the quarter.  Finished goods inventories increased 16 percent  due to higher product acquisition costs, expanded product assortments and new store openings, as well as some effect from weaker sales growth. Tiffany stated that a 44 percent increase in raw material and work-in-process inventories reflected higher product acquisition costs, expanded rough diamond sourcing and internal manufacturing.
Cash and equivalents and short-term investments totaled $343 million compared with $622 million one year ago. Short-term and long-term debt totaled $834 million on April 30, which was up from $687 million in 2011.
Kowalski added that Tiffany was updating its  forecast for the full year to reflect the first quarter results along with lower near-term expectations. ''Although we are very early into the second quarter, worldwide sales are currently increasing by a low-single-digit percentage, reflecting difficult year-over-year comparisons and decelerating rates of economic growth in many countries. In 2011, we achieved extremely strong sales growth in the second and third quarters, especially in the Americas and Asia-Pacific regions."

 RAPAPORT

Are your diamonds worth their money?

Next time you buy diamond jewellery or loose polished diamonds, make sure that you are not being cheated with synthetic colourless diamonds. A huge quantity of synthetic colourless stones, which are difficult to distinguish from naturals are in circulation in the diamond market.
International Gemological Institute (IGI), world's leading gemological laboratory, issued a trade alert in India about the huge volume of synthetic colourless diamonds in the market after they received more than 600 synthetic colourless diamonds for grading at their lab facilities in Antwerp and Mumbai last week.
"I believe there are other undisclosed colourless synthetic diamonds out there," IGI Worldwide co-CEO Roland Lorie said in a statement. "But we just don't know how many. I don't think the volume is huge. You just wonder how this parcel got out there, and how many else are left," he added.
The IGI's alert follows an alert issued by De Beers' Diamond Trading Company (DTC), which noted that undisclosed stones had also appeared at National Gems & Jewellery Technology Administrative Centre (NGTC) lab in China, some few days ago.
Synthetic diamonds have become increasingly popular throughout the past years, as they give off a beautiful luster and an authentic look that is very similar to real or natural diamonds.
There are two basic methods that are used when it comes to the production of synthetic diamonds. The most common technique is called high pressure high temperature process, otherwise known as HPHT. This process produces a stone that is very similar to natural diamonds. Another technique used called chemical vapour deposition or CVD.
The India is fast emerging as a leading consumer market for polished diamonds after US. London-based, BMO Capital Markets, estimates that India represented 9 per cent or $1.3 billion of global polished diamond demand in 2010, which exceeds the total Chinese demand for polished diamonds that stands for 5 per cent or $1 billion.
"Trading in misrepresented or undisclosed products, whether inadvertently or not, could cause irreparable damage to reputation and undermine the integrity of the diamond supply chain," said a senior official of Gems and Jewellery Export Promotion Council (GJEPC).

See more : DCLA

Sierra Leone 'blood diamonds' not forever

 

 Some of Koidu's diamond mines are now mechanised

The west African state of Sierra Leone has taken another symbolic step away from its wartime image as the home of the "blood diamond". An Israeli-owned company has started operating a big new stone-crushing plant at a modern diamond mine in the east of the country.

It is the area where the rebel war in Sierra Leone began in 1991 and - not coincidentally - the place where most of the country's diamonds are found.
The contrast between the modern new plant, based in the town of Koidu, and traditional hand-dug alluvial mining could not be more stark.
The plant is part of a wave of foreign investments in mining, roads and buildings that have transformed the face of Sierra Leone in the past few years.

This is the future... it means work for the people and income for the country”

Beny Steinmetz Owner of Koidu Holdings

New start

The Mayor of Koidu, Sahr Musa Sessie-Gbenda, said: "Before the war this was a major trading centre because it's near the borders of Guinea and Liberia.

"Then during the hostilities the economy took a nose dive. Now, people are trying to rebuild again."
Koidu is still a very poor place by international standards.
I didn't see a single properly tarmacked road in the town and most people here have to get by without running water or mains electricity.
But the markets are buzzing with activity and bulldozers are beginning to dig storm drains along major routes and grade some of the tracks.
The owner of the newly refurbished mine that trades under the name Koidu Holdings, is an Israeli billionaire, Beny Steinmetz.
By chance he was in Koidu when I visited and although he said he never gave broadcast interviews, I managed to persuade him to say a few words.
He did not say much - billionaires, I suppose, do not have to.
"This is the future," he said. "It means work for the people and income for the country".

Lots of people have land, but having land without money to invest in it... it's no use.”

Job Koademba Cocoa trader

Bloody past

When I visited Koidu in the late 1990s it was a moonscape of small pits dug by civilians but largely controlled by armed rebels who stood over them to "tax" any gemstones they found.

The thirst for diamonds, called "blood diamonds" because many were used to buy rebel guns, was so intense back then that people were digging up the foundations of houses in search of gems.
At the time, I did not understand why the footings of houses were so attractive to the diggers.
But an engineer at the new mine explained the phenomenon to me on my return visit this year.
"In the 1970s and 80s people built the foundations of their houses here using gravel waste from a long abandoned diamond mine," the engineer said.
"Over the years the demand for diamonds increased, so what was waste a long time ago could be exploited again, especially because the rebels had slave labour to do the work for them."
"That's why, when you came here in the late 1990s," the engineer told me, "you saw people digging up their living rooms!"

Some people still have have no choice but to pan for diamonds by hand

Today there are still thousands of people living off traditional hand-dug mines in the Koidu area.
Digging and panning for diamonds by hand is backbreaking work, but for many people it is the only work available.
Investment boom The new plant that runs 24 hours a day only employs a small percentage of the people in the area who would like jobs there.
Sierra Leone's foreign investment boom, mainly in iron ore and diamond mines but also in roads and new homes, has created small islands of prosperity and the possibility of increased tax revenues for the state.

Sierra Leone at a glance

• Population: Six million
• Area: 71,740 sq km (27,699 sq miles)
• Life expectancy: 48 years (men), 49 years (women)
• Main exports: Diamonds, rutile, cocoa, coffee, fish
• GNI per capita: $340 (£214)
• Adult literacy rate: 41%
• Maternal mortality ratio (est per 100,000 live births): 970
• Some 50,000 people died in the 11-year civil conflict which ended in 2002

Sources: UN/World Bank

But the majority of Sierra Leoneans are still extremely poor and it is still an open question how much of this new investment money will, in the development economists' phrase, "trickle down" to ordinary people.

The vast majority of Serra Leoneans make a living out of agriculture.
A cocoa trader in Koidu, Job Koademba, said small scale investments in farms were essential if more people were to be brought out of poverty.
"Lots of people have land," Mr Koademba said, "but having land without money to invest in it - to buy seeds and tools - is like having a car without any fuel in it. It's no use."
Mr Koademba is undoubtedly right.
But it is also true that in the past decade or so Koidu has changed beyond all recognition.
Where there were rebels with guns, there are now police officers. Where there were hungry, displaced people, there are now lively market traders.
A bad image or reputation sticks like glue - especially in Africa.
So it is worth saying again.
There are no more "blood diamonds" in Sierra Leone.

  By Mark Doyle BBC News, Koidu

IGI Finds Hundreds of Undisclosed Synthetic Diamonds at Labs

RAPAPORT... Several hundred man-made diamonds were sent to the International Gemological Institute ‎‎(IGI) in Antwerp and Mumbai to be certified as natural diamonds, raising concerns that a large ‎volume of these undisclosed CVD synthetic stones may have entered the market already.‎

Roland Lorié, the chief executive of IGI, told Rapaport News that the company received an initial ‎batch of 145 stones at its Antwerp lab and that following tests proving the stones to be ‎CVD synthetics, the full parcel of more than 600 stones were presented to the lab. ‎

‎“A diamond dealer cannot tell the difference between natural and CVD synthetic diamonds ‎and it requires sophisticated machinery at the labs to make the necessary findings,” Lorié said. ‎‎“This means that there could be a large amount of undisclosed synthetic diamonds on the ‎market.”‎

An unnamed polished dealer, who had bought the synthetic stones on the open market --at natural ‎diamond prices-- submitted the goods to IGI for certification about two weeks ago after he was ‎unable to sell them as a parcel on the dealer market. ‎

Lorié said that the polished dealer and his supplier both claimed to be under the impression ‎that the goods were natural diamonds. ‎

Around the same time, a smaller parcel of 10 stones was submitted to IGI’s Mumbai lab by two ‎separate parties. IGI found that all these sets of goods were CVD synthetic diamonds and likely ‎came from the same source.  ‎

IGI issued a trade alert to other laboratories regarding its findings. ‎

‎“Additionally, IGI decided to share detailed scientific information with other gemological ‎laboratories around the world, as we now suspect that the volumes of colorless synthetic ‎diamonds being released on the global markets have increased noticeably, and may perhaps ‎already be prevalent throughout the  diamond centers,” IGI stated.   ‎

The company worked with the Belgian Federation of Diamond Bourses (BFDB), the Diamond ‎Trading Company (DTC) Research Centre  and the Antwerp World Diamond Centre (AWDC) to ‎alert the trade about the issue. ‎

DTC reported to sightholders that it has identified three recent instances of undisclosed ‎submission of CVD synthetics to grading laboratories in Belgium, India and China, whereby ‎each case had very similar characteristics and may have had a common source. ‎

''The DiamondView and photoluminescence results indicate that the CVD synthetics have been ‎heat-‎treated post synthesis and we note that the combination of characteristics is ‎strikingly ‎similar to that reported by the GIA [Wang & Moses 2011] for 16 CVD synthetics ‎received from ‎Gemesis Corporation,” DTC told sightholders.

Stephen Lux, the president of Gemesis, said, ''Gemesis has been completely forthcoming about exactly what it is selling to the public.  There are several other companies that are practicing the CVD technology, with some scale as to have capability for the few hundred diamonds that most unfortunately have been sold inappropriately.  The recent 2-carat lab-created submission to GIA India (also not from Gemesis) is evidence of others’ capabilities. Gemesis can assure the industry with 100 percent certainty it has not been involved in selling its diamonds as mined, and the undisclosed diamonds referenced in the DTC and IGI alerts are not Gemesis diamonds.''  

Lux added that Gemesis is ''committed to maintaining supply-chain integrity and providing knowledge of origin of its products.'' Each of the company's lab-created polished diamond larger than one-quarter carat are laser inscribed with an identifying number as part of the certification process.

''Gemesis also hopes that this unfortunate event will encourage the industry as a whole to be more proactive in assuring the success of lab-created diamonds in the right way and we pledge our cooperation in making that happen,'' Lux concluded.

Avi Paz, the WFDB president, explained that the diamond bourses require their members to ‎identify synthetics and disclose any treatments used on diamonds. He stressed that the ‎bourses are guided by clear rules regarding the trading in misrepresented or undisclosed ‎products, whether inadvertently or not. Any violations of these rules are referred to the ‎relevant bourse for disciplinary action and can be grounds for suspension, expulsion, fine or ‎other appropriate measure. ‎

‎“Together with the diamond laboratories, which have the means and technological ‎instruments to detect man-made and treated diamonds, our affiliated bourses provide ‎assistance in identification techniques and a secure structure,” Paz said. “It is in the interest of ‎our global business that it remains transparent so that consumers can receive full disclosure ‎about the diamonds they purchase.”‎

DTC added that trading in these goods could cause irreparable damage to reputation and could ‎undermine the integrity of the diamond supply chain, damaging both trade and consumer ‎confidence in buying diamonds. ‎

DCLA identifies Treated Pink Diamond

Synthetic Diamonds on the market in Australia?

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Jeweller Graff Diamonds launches Hong Kong IPO roadshow

 
High-end London-based jeweller Graff Diamonds on Monday launched a roadshow for its reported $1.0 billion initial public offering in Hong Kong, one of the biggest this year.

Graff Diamonds Founder and Chairman Laurence Graff and Chief Executive Officer Francois Graff met potential investors at a hotel in the southern Chinese city, but did not speak to reporters.

In a filing to the Hong Kong stock exchange, the company said it made $623.5 million in retail sales last year compared with $454.3 million the year before, as revenue growth rebounded from a slump induced by the 2008 financial crisis.

Britain accounted for more than half of total retail revenues, but Asia's contribution more than doubled to $120 million, it said, adding that net profit grew more than 15 percent to $120.1 million.

The company planned to open five more directly operated stores selling jewellery and watches in Asia this year, in addition to the 18 it already operates around the world.

Expansion of the Asian retail network, development of Graff as an "iconic brand" and developing the watch business were central to the company's strategy.

Among the risks for investors, the company cited the importance of a tiny group of 20 top customers, who had accounted for more than 40 percent of group revenue for the past three years.

The roadshow is due to continue until May 31 when the IPO will be priced, according to a term sheet seen by Dow Jones Newswires.

The IPO is set to be one of this year's biggest share sales after China's second largest brokerage Haitong Securities last month raised $1.68 billion from its Hong Kong IPO.

The jeweller's listing in Hong Kong will enable it to raise its profile in Asia and tap the fast-growing luxury goods market on mainland China.

China is forecast to be the world's top buyer of products such as cosmetics, handbags, watches, shoes and clothes by 2015, PriceWaterhouseCoopers has said.

Graff Diamonds' presence in Asia includes boutiques in Hong Kong, Shanghai, Beijing, Tokyo and Taipei. It is planning to open three flagship stores in the Chinese city of Hangzhou, Macau and Dubai this year, according to its website.

The jeweller will join other luxury brands using Hong Kong as a gateway to the burgeoning Chinese market, after the listings by Prada of Italy, US handbag maker Coach and US luggage maker Samsonite.

The slew of luxury firms seeking to list in Hong Kong are a sign of Asia's growing appetite for designer goods, especially among cash-rich Chinese.

Stone recovered from “diamond switcher”

 
The “diamond swticher” saga entered a new phase Saturday  after an alleged jewel thief passed a $20,000 diamond Windsor police have anxiously awaited for more than a week.
Police have been waiting for Richard MacKenzie Matthews, 52, to pass the stone since he swallowed a 1.7-carat diamond Thursday, May 10,  at Precision Jewellers on Howard Avenue after allegedly trying to switch the diamond with a cubic zirconia.
Staff Sgt. Dave Kigar said Matthews passed the stone during a bowel movement Saturday afternoon.
“At Mr. Matthew’s request he has since been transferred to the County Jail where he is resting a little more comfortably than he was in our dry cell,”  Kigar said about the suspect being held in a cell without a sink or toilet for the past nine days.
“We’ve got the diamond and an additional charge will be laid against him of possession of stolen property.”
The alleged “diamond switcher,” a well-known thief wanted in other jurisdictions, was arrested last Thursday.
After he allegedly tried to switch the gem with a fake, store employees confronted him, locked him in and called police.
Liz Dick, the store employee who caught Matthews, said she had shown him diamonds before on different occasions.
He was supposedly shopping for an engagement ring, he told her.  She now believes he had been casing the place.
“I feel pretty good we took him off the streets,” she said Sunday. “He’s done it before so he may have left our store and may have tried to pull the wool over someone else’s eyes and got away with it.”
When Dick handed him the diamond last Thursday, the employee of 10 years said she knew “right away” the one he handed back was a fake.
After she confronted him, she said he seemed to flip something in the garbage can.  He also went to the water cooler and took a drink.
Matthews then swallowed the diamond along with two cubic zirconias. Dick said she checked the garbage as police searched Matthews.
She found a piece of paper with three other fake diamonds, each a different size.
Not only did Dick say the retrieved diamond should be “perfectly fine” and would most likely maintain its value, she believes people will seek out the diamond because of the story behind it.
“I think it proves for an interesting stone.”
She said she is unsure what will happen to the diamond and has not seen it since it was stolen.
One of the fake gems swallowed by Matthews was recovered Friday. The second zirconia has still not been found, Kigar said.
The stolen diamond was returned to the owners at the store, Kigar said.
Matthews is charged with theft over $5,000 and breach of court conditions. A charge of possession of stolen property is pending.

China's Zimbabwe diamonds unpaid

Harare - Chinese diamond firm Anjin failed to remit revenue from its operations in Zimbabwe's controversial Marange fields in the first quarter of this year, Finance Minister Tendai Biti said on Thursday.
"We have not received a single cent from Anjin, yet Anjin is seven times bigger than some of the other [diamond] companies," Biti told reporters giving his monthly fiscal statement.
Anjin is in a joint venture with the Zimbabwe government, as are three other firms.
Biti said there were suspicions the funds were funnelled elsewhere, outside the government central coffers.
"Clearly, we fear as the ministry of finance that there might be a parallel government somewhere in respect of where these revenues are going, and are not coming to us.
"There is opaqueness and unaccountability surrounding our diamonds."
Anjin along with Diamond Mining Corporation, Mbada and Marange Resources are mining the gemstones in Zimbabwe's eastern Marange area, where activists have reported gross rights abuses.
Zimbabwe government owns a 50% stake in all the four companies.
Revenue shortfall
Biti said Anjin's failure to pay in proceeds from its diamond sales could impact negatively on Zimbabwe's $4bn budget for 2012 where at least $600m was projected to come from diamond sales.
Total revenue collections for the first quarter of 2012 stood at $287.9m against a target of $320.2m, with the shortfall blamed on "under performance of diamond revenue".
"Diamond revenues have been under perfoming since January to 2012, with only $30.4m remittances received for the period January to 21 March 2012," he said. The target was $122.5m.
Biti said he has complained to leaders in the power-sharing government over the diamond revenue shortfall.
He said Zimbabwe's economy, which went into a tailspin amid a political crisis before the creation of unity government three years ago, continued to recover with gains in the mining, manufacturing and energy sectors.
Inflation will remain in single digits but might be higher than anticipated if revenue shortfalls continue, said Biti.

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