Wednesday, December 19, 2012

Rockwell's S. Africa Diamond Production +12% in 3Q

Rockwell Diamonds reported that combined production at its Saxendrift, Klipdam and Tirisano projects in South Africa rose 12 percent year on year to 5,950 carats in the third fiscal quarter that ended on November 31, 2012. The company noted that the increase came despite operational challenges and ongoing industrial action at its Tirisano mine.

Production at Saxendrift rose 26 percent to 2,444 carats with 633 carats recovered at the Saxendrift bulk x-ray project. However, production at Tirisano fell 69 percent to 1,244 carats, while Klipdam yielded 1,975 carats, down 9 percent from one year ago.

"Our overall throughput and diamond production volume are consistently tracking closer to expectations," said James Campbell, Rockwell's chief executive.

During the quarter, the company signed a three-year mining agreement with CML to outsource mining operations at its Klipdam mine in an effort to reduce high unit costs and improve earth-moving capabilities. This resulted in the mine exceeding its objectives, Rockwell said.

Since the quarter closed, the company  placed its Tirisano mine on care and maintenance in early December due to persistent industrial action and continuous financial losses, which resulted from a slower than anticipated recovery in the price of smaller diamonds that accounts for much of Tirisano’s production. A total of 381 carats were recovered at the mine during the quarter.

Tuesday, December 18, 2012

President Koroma declares… “Sierra Leone’s no longer country of blood diamonds”

As part of his speech during the State Opening of Parliament last week, President Ernest Bai Koroma says that “Sierra Leone is no longer a country of blood diamonds,” as widely portrayed all over the globe.

He said Sierra Leone is now a country where peace and stability reigns; where fruitful advice is sought for the consolidation of peace and tranquility in the sub-region and other parts of the world; giving support to peace building initiatives by sending troops on peace missions to countries that are in war.
The President said that Sierra Leone has conducted peaceful, free, fair and largely credible post-war elections that have subsequently become the envy of the world.
He said that other countries, especially peace-loving ones are now emulating Sierra Leone to enhance their democracies and peace-building programmes.
Therefore, he went on, for such insinuations which have bedeviled the country for so long, his new administration is going to considerably improve on the image- building efforts in a bid to further attract investment. This, he said, will send a picture all over the world that Sierra Leone is indeed not only the Athens of Africa but a place where peace, unity, religious tolerance exists at their highest peak.

Monday, December 17, 2012

Over 10,000 Sierra Leoneans Illegally Mining Diamonds in Liberia

Over 10,000 Sierra Leoneans are illegally mining diamonds in the country, the United Nations Panel of Experts on Liberia has reported. According to the Panel in its final report submitted to the UN Security Council early December 2012:"The Panel estimates that the number of Sierra Leonean miners in Liberia is now in excess of 10,000."

"As the Panel stated in its midterm report, many of the diggers operating illegally in the sector have crossed the border from Sierra Leone with financial backing from diamond brokers in Kenema," said the Panel's report. The report indicates that the illegal Sierra Leoneans miners compete with Liberians for both mining ground and logging areas, adding that in this case, the potential for territorial conflict between the Sierra Leoneans and Liberians remains significant.
The UN Panel of Experts says it is concerned about "several reports from industry sources that have complained that the influx of Sierra Leonean miners continues unabated, and, as the Panel reported, legitimate Liberian diamond miners have been threatened when they have attempted to move squatters off their claims."
The Panel of Experts report, which covered Liberia's alluvial diamond mining sector and security condition, states that much of the illegal diamond mining in Liberia is taking place in Grand CapeMount, Gbarpolu and Lofa counties, adjacent to the country's borders with SierraLeone, Guinea and Côte d'Ivoire.
The report details that specifically, such illegal mining activities are carried out within areas that have close proximity with markets inKenema and Koidu, in Sierra Leone, adding that these areas encourage trafficking, particularly as thosemarkets are larger and more vibrant than those in the interior parts of Liberia.
"During the course of interviews with diamond miners in western Liberia, the Panel learned that markets in Sierra Leone often pay higher prices for diamonds than those in Monrovia [Liberia's capital]', the UN Panel of Experts report noted, adding that: "The temptation to traffic is further increased when the difficulty and cost of transportation to Monrovia or even regional offices is factored in."
The report avers that the scenario of increased difficulty and cost of transportation is particularly true for areas in the remote north-western part of Liberia, which the report says are often much closer to Sierra Leonean markets than to Liberian ones.

Sunday, December 16, 2012

HRD Antwerp Launches Screening for Synthetic Diamonds

HRD Antwerp has introduced a new service to help in the fight to keep undisclosed synthetic diamonds out of the market.
The new check will help diamond traders to ascertain that all stones in a polished diamond parcel are natural by screening parcels of near colorless polished diamonds for HPHT and CVD synthetics, HPHT-treated diamonds and diamond imitations.  

The examination applies to parcels containing a minimum of 20 diamonds, ranging from 0.05-0.49 carats with a color range between D and L.
Once the screening has been completed, the client will receive a sealed parcel containing a screening report. The wording of the report states, “This parcel only consists of natural diamonds, not synthetic and not HPHT treated.” 

If a possibly synthetic or HPHT-treated diamond or diamond imitation is discovered, the suspect items will be removed and returned in a separate parcel.

The service is currently provided by HRD Antwerp in Antwerp and Mumbai.


DCLA in Sydney is the only Laboratory that has screened every diamond ever certified. 

Thursday, December 13, 2012

Botswana Diamonds detects 13 new diamond targets

The positive results are borne out of a year-long technical co-operation agreement between Botswana Diamonds and a major diamond multinational.diamond mining
Botswana Diamonds (LON:BOD), the Diamond exploration company, has identified 13 specific sites in the north east of Botswana believed to contain diamond kimberlites.
As a consequence, the diamond explorer has extended the technical cooperation agreement with its project partner until June 30, 2014. It will now focus on the south and southeast of the African country.
“There is no certainty in exploration.  What lies under the ground is always unknown until drilled but the results from the work done by [both companies] in the past year are promising,” said Botswana Diamonds chairman, John Teeling.
The company added that an exploration program of detailed ground gravity, soil sampling and drilling is ready to proceed once licences are obtained.

Wednesday, December 12, 2012

Red diamond sells for $2.1M, sets auction record

Christie’s New York saved one of the best for last on Monday. The final lot of the fall auction season, a 3.15-carat fancy reddish-orange diamond, sold for $2.1 million, setting new world records for both a reddish-orange diamond at auction and the price-per carat for that particular hue at $666,200.
A member of the U.S. trade purchased the circular-cut stone, paying nearly double its high pre-sale estimate of $1.2 million.
While it was record-setting, the red diamond was not the top lot of the day.
Christie’s sale of Magnificent Jewels saw diamantaire Laurence Graff pay $8.4 million for a 50.01-carat, D potentially flawless diamond ring (pictured below). It is the third time the famed diamantaire has purchased this particular ring.
“Diamonds of this exceptional caliber have a life and legacy that carries on beyond us all,” Graff said after the sale. “This is one of the finest D-color diamonds in the world and I am delighted to have it back again.”
All told, Christie’s New York sale garnered $32.5 million, selling 84 percent by lot and 86 percent by value.
This final sale of the year brings Christie's New York auction total of 2012 to more than $163 million. The auction house said the final total for the jewelry category will be released in January 2013 as part of the company’s annual report.
Among the New York headlines for the year was the April sale of the jewels of reclusive U.S. copper heiress Huguette M. Clark, which totaled $20.8 million and set a new record for a pink diamond sold at auction in the United States.
The third highest-grossing lot of Monday’s sale was a modified cushion-cut, 6.18-carat Burmese ruby ring in 18-karat gold. A member of the European trade paid $1.7 million for the ring, with features a bezel-set ruby surrounded by baguettes.
A 30.73-carat, rectangular-cut, H VS1 diamond ring by Sabbadini sold for $1.7 million to a member of the Middle Eastern trade and was the fourth highest-grossing lot of the sale.
In addition, an anonymous buyer snapped up a 9.81-carat, cushion-cut Kashmir sapphire signed ring from Tiffany & Co. (pictured here)  for $1.4 million, or $154,000 a carat. The ring’s sale set a new world record price for a Kashmir sapphire at auction.

Source: nationaljeweler

Tuesday, December 11, 2012

IDMA president calls out to rough diamond producers: "Wake up: our business - your business - is under threat!"

Dear fellow diamond manufacturers and traders, 

At this time, as these are the last few weeks before the end of year holidays, most of us will be quite busy. However, I think this is as good a time as any to invite our industry peers to do some strategic thinking about the future of the diamond supply pipeline.

In past October, at the 35th World Diamond Congress, discussions on rough supply were largely skirted at the joint meetings. The only time it was discussed, albeit indirectly, was during the presentation of the World Diamond Mark programme, which I hope will be successful, for the sake and benefit of the entire diamond supply pipeline.

However, I'd like to pause for a moment and discuss the current rough diamond market, analyze it and understand about what is actually happening out there.

Let's take a look at who exactly are the customers buying rough diamonds, what their position and role is and how the industry that supplies polished to the end user actually does it, and most important, what they are saying..

I am sure that different people will give different answers to the above questions

For instance, they may say that:
             that the only product manufactured from rough diamonds is polished diamonds;
             or that the diamond polishing business is a money-losing business;
             or that attempts in the last decades to cause sight holders to invest their resources into growing market share for diamonds- as in the Supplier of Choice vision - have collapsed (thank you for that, Gareth Penny);
             or that in recent years the only buyers of rough who are making money on rough are those who speculate with it;
             or that prices for certain polished categories haven't changed for 30 years while rough prices have soared;
             or that the members of new generations in family businesses don't see much sense in carrying on;
Other questions that can be asked about the future is why the rough suppliers are:
             depleting their clients' resources by demanding rough prices that are higher than those of the polished;
             devaluing their stocks;
             reducing prices month after month instead of limiting the flow of rough to the oversupplied market?
If the suppliers would care to answer these questions honestly, it would also help them understand where they might find themselves sooner than they expect - in the doldrums, together with the manufacturers.

Sadly, there is no real competition in the rough diamond market. In a truly competitive market, when you fight for the client, you'll see progress. But when the client is turned into some kind of money extraction machine, we find ourselves where we are now. And no machine can function without the necessary lubricant to keep the cogs moving. .

Surely, the producers, too, must know that sales of diamond jewellery are declining, and are losing market share within the luxury goods consumer market?
They, too, must know that a joint, dynamic effort is needed to increase demand for diamonds?
They, too, cannot but grasp that such an effort should be funded by those who have the biggest stake in our pipeline, by those who sell their goods with the biggest profit margins?

The question is therefore, why are they not stepping up to shoulder that effort?
Wake up, your business - our business - is under threat.
We, the manufacturers will all help you in this endeavor.

Maxim Shkadov,
IDMA President

Monday, December 10, 2012

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De Beers Invites Auction Customers to Apply for 2012-2015 Term Supply

For the first time, as part of the supplier of choice (SOC) strategy, the De Beers Group is pleased to announce that eligible customers of its rough diamond auctions will be invited to apply for term supply for the remainder of the 2012 to 2015 SOC contract period.

The announcement reflects changes made to SOC and announced in April 2012, to create a more dynamic intention to offer (ITO) re-planning process. Sightholders and non-sightholders that have demonstrated sufficient demand through De Beers’ auction sales in 2012 will, subject to De Beers’ forecast rough diamond availability, have the opportunity to qualify for an ITO by submitting a contract proposal questionnaire (CPQ) as part of the 2013 ITO re-planning process.
In addition to meeting mandatory financial and compliance requirements, in order to be eligible to apply for an ITO, auction customers (who may or may not be a current sightholder) must have demonstrated the requisite level of demand at De Beers’ auction sales in 2012 in categories of rough diamonds for which De Beers has sufficient forecast availability.
All CPQs will be assessed according to the rigorous procedures that were used in 2011 to select sightholders for the 2012 to 2015 contract period.
Customers that have met the demand requirements will be notified by De Beers on December 18, 2012 whether they are eligible to submit a CPQ in light of De Beers’ forecast availability.


Sunday, December 9, 2012

Sotheby's NY Magnificent Jewels Nets $49M

Sotheby's sale of Magnificent Jewels held in New York achieved $49.2 million with Laurence ‎Graff winning the top three lots. The sale was 78 percent sold by lot and 84 percent sold by ‎value. Diamonds featured in nine of the top ten lots sold.‎

Sotheby's noted that at least six bidders bid for the top lot (pictured), a 6.54 carat, fancy ‎intense pink, internally flawless diamond ring by Oscar Heyman & Brothers that belonged to ‎Evelyn Lauder, which sold for $8.6 million or $1,313,144 per carat. A 52.73 carat, fancy vivid ‎yellow, VVS1 diamond ring achieved $3.9 million or $73,781 per carat while a 22.16 carat D, ‎potentially flawless type IIa diamond ring by Graff sold for $3.4 million or $155,347 per carat.‎

A 33.84 carat, D color, VVS2 diamond ring achieved $2.9 million, or $88,489 per carat, while a ‎heart shaped, 7.14 carat, fancy intense yellow,  VS1 diamond pendant necklace by Van Cleef & ‎Arpels, which Estée Lauder purchased directly from the Duchess of Windsor in the 1970's, sold ‎for $2.5 million, or $54,020 per carat. An important 14.12 carat, D color, potentially flawless, ‎type IIa diamond ring by Bulgari sold for $1.9 million, or $140,488 per carat while a 29.96 carat, ‎fancy pinkish brown, VVS1 garnered $1.4 million, or $52,911 per carat.‎

Proceeds from the sale will benefit The Breast Cancer Research Foundation, founded by ‎Evelyn Lauder in 1993.‎

‎“On behalf of the Lauder family, we are very pleased that the beautiful unique pieces owned ‎by my mother Estée and my dear wife Evelyn have found new homes, while at the same time ‎raising significant funds for The Breast Cancer Research Foundation," said Leonard A. Lauder, ‎chairman emeritus of the Estée Lauder Companies and acting chairman of The Breast Cancer ‎Research Foundation®. "My sincere gratitude to Sotheby’s and to those who participated in ‎this auction. Our hope is that one day this disease will be a thing of the past and with the ‎money that was raised tonight, we are one step closer to achieving our goal.”‎

Sotheby's also sold jewels from the collection of Mrs Charles Wrightsman. The sale of the ‎collection totaled $15.5 million, exceeding its $9 million high sale estimate and was 95 percent ‎sold by lot.‎

The top lot from Mrs Wrightsman's jewels was a natural Belle Epoque pearl and diamond ‎corsage ornament, inspired by eastern design motifs featuring three Golconda-type ‎diamonds, weighing 8.67 carats, 8.78 carats, and 9.59 carats, which sold for $2 million after ‎heated competition between seven bidders. A rare natural gray pearl and diamond brooch set ‎a new auction record for a single natural gray pearl at $1,874,500, more than triple its high ‎‎$600,000 pre-sale estimate.‎

The combined sale of jewelry from the collections of Estée Lauder, Evelyn H. Lauder and Mrs. ‎Charles Wrightsman achieved $64.8 million and exceeded overall pre-sale estimate of $63.3 ‎million. This figure raises the 2012 total for Sotheby’s worldwide jewelry auctions to $450.5 ‎million, a record high for the company’s sales in this category and also marks the highest-ever ‎total for a day of jewelry sales at Sotheby’s New York.   ‎

Thursday, December 6, 2012

Kimberley Process Retains Conflict Diamond Definition

Despite calls for change, the Kimberley Process’ (KP) definition of conflict diamonds remains the same, and some believe that is limiting the initiative’s ability to address modern challenges.
What is the Kimberley Process?

The KP is a tripartite initiative composed of governments, diamond industry players and civil society organizations (CSOs). It was created to both protect the image of diamonds by keeping them free of association with violent conflict and to prevent rebel movements from obtaining and using diamond revenues to fund insurgencies and undermine governments.To achieve these objectives, the KP oversees a certification scheme for rough diamonds. Members must adhere to minimum requirements that regulate various aspects of the trade, such as production, trading partners and import and export procedures.
However, the KP, which is approaching its 10th anniversary, has been accused of dropping the ball on numerous occasions, such as with issues involving the Ivory Coast, Venezuela and Zimbabwe. And its critics argue that the KP has grown increasingly out of touch, irrelevant and ineffective.
Global Witness quits the Kimberley Process
Global Witness (GW), which played a key role in establishing the KP, quit its role in the initiative last year. GW said the KP’s refusal to evolve and address clear links between diamonds, violence and tyranny has rendered the KP increasingly outdated.
“Nearly nine years after the Kimberley Process was launched, the sad truth is that most consumers still cannot be sure where their diamonds come from, nor whether they are financing armed violence or abusive regimes,” said Charmian Gooch, a founding director of GW, in a press release. GW even went so far as to call the KP “an accomplice to diamond laundering — whereby dirty diamonds are mixed in with clean gems.”
Reforming the Kimberley Process
Even within the KP, the need for reform is widely recognized and the KP is supposed to be undergoing a self review.
“Why we feel there are changes needed, however, is that a certain number of the procedures or the definitions that were very well adapted to the situation ten years ago and we believe are no longer as current as they need to be in order to be able to maintain the consumer confidence and do the job everyone wants the Kimberley Process to do,” Gillian Milovanovic, KP chair, said during a web chat.
Part of the challenge for the KP is that what people want it to do varies. Arguably one of the most important changes that the KP needs to make is to redefine what a conflict diamond is. The KP’s definition of conflict has not evolved beyond its initial focus on rebel activity, which critics insist is far too narrow.
“It is the definition of conflict diamonds that underpins the KP’s ability to act decisively in the face of unacceptable and criminal behaviour; to censure, to demand improvement, and, if needed, expel a country,” said Alan Martin of Partnership Africa Canada at the World Diamond Council’s annual meeting.
However, one of the problems there is that some are pushing for expansion into territory that the KP has resisted entering, such as a human rights.
Welcoming the opportunity to offer clarity on this subject, the KP chair told web chat participants that “admittedly, conflict clearly has something to do with human rights because people suffer when there is conflict, but human rights per se is not the focus. Human rights is implicit but it’s conflict and still would be with the changed definition.”
If diamonds are not at the core of a conflict, Milovanovic added, then the conflict is not something for the KP to deal with.
Plenary meeting
The KP holds an annual meeting, the plenary, where decisions are made. This year it was in Washington, DC from November 27 to 30. While there were numerous considerations on the agenda, for many, the most anticipated was the discussion of the definition of conflict diamonds.
Though KP members from the diamond industry and CSOs are included in the decision-making process, only governments get to vote. Changes, such as the proposed update of the definition of conflict diamonds, are made upon consensus.
“We were not able to reach the point where we saw agreement on a text,” Milovanovic reportedly said at a press conference after the meeting.
Ahead of the meeting, she said that what she saw as important and was pleased about was more engagement from countries, parts of the industry and individuals who in the past sat back and didn’t feel they should participate and didn’t feel they should make their views known. “Now we’re really getting into a lot of good exchange, a lot of engagement and I think that will be a critical achievement,” she said.
The fact that the definition of conflict diamonds remains the same is likely a disappointment for many and will almost certainly provide fodder for further criticism of the KP.
“Ultimately, however, the KP holds its fate in its own hands. If it squanders the current opportunity to address systemic problems that have plagued it — with greater consequences each time — then it will seal its own irrelevancy. More people will reconsider their engagement with the KP and the reflection will shine a bright and unflattering light on the industry as a whole,” Martin warned earlier this year.

Wednesday, December 5, 2012

Blue Nile's Cheaper Diamonds Need Not Threaten Tiffany. Here's Why.

The Astors draped themselves in Tiffany diamonds; Marilyn Monroe made them "a girl's best friend;" Audrey Hepburn's Holly Golightly called Tiffany's flagship New York store "the best place on earth."
But today, for a significant portion of diamond-buyers — men looking to propose — the answer is not the exalted little blue box, but low-cost online entrant, Blue Nile. The threat of Blue Nile has been felt most by mom & pop jewelers, but increasingly by the middle market retailers like Zales Corporation, as well as high-end brands like Tiffany and Cartier.

So what should premium diamond retailers do? The answer may be counterintuitive: nothing. As my colleagues explain in "Surviving Disruption," sometimes it's better for an incumbent to focus on its relative advantages and cede parts of the market to the disrupter instead of trying to compete head-on.
Blue Nile's primary advantage is that it offers diamond rings online at prices that are as much as 35% lower than traditional retailers. Their basic premise is that loose diamonds are commodities; quantifiable details (e.g., the 4Cs of carat, cut, color, clarity), a few photos and a price should be all a man needs to select a diamond. Blue Nile also provides simple-to-use educational tools and an impressive virtual inventory (they act as a middleman for diamond wholesalers). For men who hope to optimize affordability, speed and anonymity in their ring search, Blue Nile is a clear winner.
While Blue Nile is a great choice for men who prioritize spending all of their budget (regardless of size) toward the diamond itself, there are other men who choose to allocate some of that budget toward personalized service or certain brands. For this latter group, they have a different set of "jobs-to-be-done" that traditional retailers are better at fulfilling than Blue Nile.
For example, for men who are hiring a diamond seller because they are nervous about finding the perfect ring, a brick & mortar retailer is a safer bet. In a store, they can gauge a particular diamond's sparkle with their own eyes, or they can confer with the jeweler, relying on his artistry. In a high-end store, they can be assured that the choices are socially affirmed, expert designs. As one young man I emailed with put it, he wouldn't buy from Blue Nile for the same reason he "wouldn't buy a used car from eBay motors. A car is more than mileage, year, make and model (does it smell? does it ride smoothly?) Likewise, a diamond is more than what is defined by the 4Cs." Though my friend recognizes that he was in part managing his own emotions, he didn't want to lose any sleep over his purchase by "optimizing cost over confidence." And that's the point. Blue Nile's online platform couldn't fulfill his job of being completely confident in his ring choice.
Of course, some men buying diamond engagement rings have another "job" they want done: signaling status. For them, a high-end luxury jeweler is better suited to that task.
No matter how much Blue Nile tries, it won't be able to compete with Tiffany and its bricks & mortar brethren to fulfill these two jobs unless they overcome very significant business model barriers. To even begin to compete, Blue Nile would have to create a physical retail network, keep diamond inventory, and invest in significant, sustained marketing efforts. This would completely undermine their cost structure, forcing higher prices and eroding their competitive advantage.
Where does this leave the traditional diamond retailers? Instead of seeking to compete directly with low-end disruptors, they should seek to become even better at the jobs that Blue Nile can't co-opt. For Tiffany, this means they should focus on cultivating their image of luxury and the "job" of signaling status, cutting the lower-priced "Return to Tiffany" line. In making Tiffany's little blue boxes accessible to everyone, they damage the brand's exclusivity and its ability to convey status.
Meanwhile, middle-tier firms like Zales and Jared should focus on customers who want to feel confident they're buying something their girlfriend will want. To fulfill the job of optimizing confidence, they could, for example, host "diamond nights" at their stores during which friends can come try on diamond rings together. Once a woman finds one she likes, she could register her favorite with the retailer. The store could then make that knowledge accessible to her friends or to her boyfriend (preferably when asked!). Knowing that his girlfriend has fallen in love with a particular ring would make the the man (finances permitting) less likely to go elsewhere for the ring, for fear of disappointing her.
On paper this seems relatively straightforward; so why is it, in practice, so hard? No company facing disruption likes to acknowledge that they can't win it all. But sometimes, relinquishing certain customers isn't an act of desperation. Rather, it returns a brand to where it should have been comfortably enthroned all along.

Tuesday, December 4, 2012

Surat diamond industry facing heat from China

Surat, widely considered as the diamond capital of the world, may lose its crown to China which is on its way to become a major manufacturer of cut and polished diamonds, warned a recent report by industry body Assocham.
The report titled ' Indian Gems and Jewellery Sector-2012' said that,"There are grave concerns of Surat based diamond processing units relocating to China which is constantly pushing for direct deals with African governments thereby locking up the supply of rough diamonds and severely denting employment scenario in Surat."

Jay Ruparel, co-chairperson of Assocham Gujarat Council said, "China has started having arrangements with African suppliers, and if supply of rough diamonds in constrained, then despite demand, there would be a loss of business to Surat-based units." He added that Gujarat-based diamond units are mostly small and medium enterprises, and cannot go up to the scale of setting up shop in China.
Assocham Gujarat Council chairperson Bhagyesh Soneji alleged that China is investing in infrastructure projects in various African countries, and is in the lookout to forge direct supply deals for rough diamonds with African suppliers. "China is trying to establish control over the raw material", she said.
Surat houses nearly 4,000 diamond cutting and polishing units and employs more than 600,000 people.
"The report brings in front of us a warning signal that it is time for the government to start taking actions to ensure there is no loss of business to the country's diamond industry", Soneji said.
She added that Assocham has urged the government to take up the issue on an urgent basis and ensure secure, reliable and adequate long term supply of raw materials for domestic industries through directly engaging with producer countries via various diplomatic channels of trade agreements and others.
India can establish a barter trade system with African countries, she felt.
Gems and jewellery currently accounts for nearly 16 per cent of India's exports, she informed. Cut and polished diamonds accounted for around 54.46 per cent of gems and jewellery exports in 2011-12. Major export markets for gems and jewellery exports are the US, United Arab Emirates, and Hong Kong.

Monday, December 3, 2012

Gem Diamonds Sells Ellendale Mine for $15M

Gem Diamonds has sold its Ellendale mine in Australia to Goodrich Resources for $14.9 ‎million (AUD 14.3 million), the companies announced Monday.‎

‎"The sale of Ellendale, at a value that we feel is appropriate given the relatively short ‎life ‎of mine of the E9 pipe, is consistent with our aim of refocusing our management ‎and ‎capital resources on our core assets and long term growth projects,” said Clifford ‎Elphick, the chief executive of Gem Diamonds. ‎

Ellendale has approximately 18 months remaining, according to the current ‎mine plan and reserve estimate; but Alex Alexander, the chairman of Goodrich, stressed the ‎company intends to carry out an aggressive exploration program to increase the ‎reserve and life of mine. ‎

Gem Diamonds is currently mining the E9 pipe, while the E4 pipe is on care and ‎maintenance. Goodrich reported that a further 47 lamporite pipes exist on the Ellendale ‎property, of which about half are thought to be diamond-bearing. Production at the mine ‎rose 42 percent year on year to 120,561 carats in the first nine months of 2012, while ‎sales increased 46 percent to $83 million. Sales include the off-take agreement with ‎Tiffany & Co. for Ellendale’s fancy yellow diamonds, which account for about 80 percent ‎of revenue from the mine, according to Goodrich.  ‎

Under the agreement, Goodrich, an Australia-based exploration company, will acquire Gem Diamonds subsidiary Kimberley ‎Diamonds, which holds the Ellendale lease. An initial payment of $3.2 million (AUD 3.1 ‎million) will be paid, while the remainder will be paid in 12 monthly installments from the ‎completion of the deal, expected in January 2013.  ‎

Analysts at Liberum Capital Mining said the deal was good for Gem Diamonds ‎given that the market values Ellendale at zero or less due to the rehabilitation costs ‎expected when the mine closes in a few years’ time. Liberum added that the deal enables ‎management to better focus on its Kholo expansion project at Letšeng and its Ghaghoo ‎mine development in Botswana. ‎

Gem Diamonds announced in November that it was extending the implementation of the ‎Kholo project’s development schedule due to the weak economic environment. The ‎company revealed Monday that the revised plan will still go ahead with development on ‎plant 1 and plant 2, while development of the third plant has been placed on hold. ‎
‎  ‎
‎“The revisions to project Kholo at Letšeng, as a result of the rescheduling of capex, ‎allows Gem Diamonds to execute the project in a more appropriate manner taking into ‎consideration the current financial climate,” Elphick said. “We continue to see sound ‎fundamentals supporting the long term strength of the diamond market which support our ‎continued investment into our key growth projects.”‎

Shares of Gem Diamonds were down less than 1 percent at 160 pence in early morning ‎trade on the London Stock Exchange.‎


Sunday, December 2, 2012

Zimbabwe's diamond trade

A UN-mandated global watchdog has agreed to end year-long monitoring controls on Zimbabwe's diamond trade, after it found the government had allayed concerns over its Marange mines.

Zimbabwe's diamond industry has been tarnished by allegations of human rights abuses since 2008 when Harare deployed security forces to drive away small-scale miners from the Marange fields.
Rights activists said 200 miners were killed in the operation, and the country was suspended from the so-called 80-member Kimberley Process (KP), which certifies global sales of "conflict-free diamonds."
In 2011, Zimbabwe was allowed to start selling diamonds from the Marange mines again but under a strict monitoring process imposed for a year by the global watchdog, set up to combat "blood diamonds".
"Over the course of that year, Zimbabwe put in a significant good faith effort. It did, in the opinion of the monitors who went on repeated occasions to Zimbabwe ... achieve most of the things that they needed to achieve, and in some cases did better than what one might have hoped," said Gillian Milovanovic, the body's chairwoman.
"Based on the monitors' evaluations ... it was determined that in fact Zimbabwe had complied with that which was expected of it," she said on Friday, at the end of a four-day meeting in Washington.
"So the sunset clause entered into effect, and the special monitoring regime is no longer in effect."
But the decision is likely to anger rights groups and non-governmental organisations which have been arguing in vain for a broader definition of the term "conflict diamond".
Earlier this month, the non-governmental organisation Partnership Africa Canada (PAC) said a network of ministers and military officials had siphoned about $US2 billion ($A1.93 billion) worth of diamonds out of Zimbabwe in the past four years.
"We continue to have concerns about ... revenue transparency related to diamond revenues" in Zimbabwe, PAC's director of research Alan Martin told the media conference in Washington.