IDE launches awareness campaign on synthetic diamonds,

Bourse to expel members proven guilty of selling undisclosed synthetics

 

Ramat Gan, Israel - December 5, 2013: Shmuel Schnitzer, president of the Israel Diamond Exchange (IDE), announced his exchange has begun an awareness campaign to ensure that the 3,500 members of the world's largest diamond bourse are fully informed of the far-reaching implications of trading -- knowingly or unknowingly -- in synthetic diamonds.

"Our industry is built on transparency, integrity and accountability," he said. "Therefore, those few unscrupulous foreign dealers who have been mixing synthetic diamonds into parcels of naturals and sold them as natural diamonds are causing tremendous damage to the reputation of our entire industry! The IDE board and I will do all we can to protect our members from falling victim to these unethical practices, but at the same time will not hesitate to expel those members who have been proven guilty of not disclosing synthetic diamonds that they have sold," Schnitzer stated.

IDE board member Yoram Dvash, who heads the IDE Industry Committee, said that while undisclosed synthetic diamonds had not yet been encountered in the Israeli trade, the issue is of major concern. "As one of the world's leading diamond manufacturing and trading hubs, polished diamonds from all manufacturing diamond centers are traded here. Therefore, we are very much exposed to these challenges and our members must know what they're up against," Dvash said.

Dvash noted that IDE's awareness campaign, coordinated by the IDE Industry Committee, will start on December 8, with a first lecture on synthetic diamonds by industry analyst Chaim Even Zohar, who will discuss the economic, ethical and legal aspects of trading in synthetic diamonds. "This is the first step," Schnitzer said. "We will follow up with hands-on and more technical information sessions soon."

Shmuel Schnitzer.

Martin Rapaport Addresses Synthetic Diamonds

Martin Rapaport, the chairman of the Rapaport Group,  has just released an editorial relating to synthetic diamonds. The editorial entitled “Sinthetics” defines measures that the diamond industry must take to ensure the integrity of diamonds and the diamond trade.

Rapaport defines the 4-D’s: Differentiation, Detection, Disclosure, and Documentation, and calls upon the trade to sample test diamonds before delivery to retailers. He says, while documentation on invoices stating that diamonds are natural is important, it is not sufficient. Trust without verification is unacceptable and dangerous. Rapaport calls on the diamond mining sector to increase consumer education about natural diamonds so that they may be properly differentiated from synthetics.

“The integrity and ethics of the diamond trade is being tested by firms that sell synthetic diamonds as natural. Retailers must investigate their sources, confirm the authenticity of their diamonds and take full responsibility for what they buy and sell. Natural diamonds can and should be authenticated and differentiated. As long as the trade is honest, demand and prices for natural diamonds will not diminish due to synthetics. Real diamond demand is not about cheap synthetic prices, it’s about the authenticity of the diamond and the relationship between people. Women want the real thing,” said  Rapaport.

“Sinthetics” by Martin Rapaport is published in the December issue of the Rapaport Magazine.

De Beers introduces forward contracts of rough diamonds

With the slowing global economy posing a threat to diamond sales, the world’s largest rough-diamond miner De Beers has introduced forward contract sales, allowing customers to book the required quantities and types of the stone for a future month. Indian jewellers, however, fear the new system will lead to an artificial rise in the prices of rough diamonds.

The contracts will complement De Beers’ spot auction events. “The purchase price for the required volume of rough diamonds in a forward contract will be determined by a customer’s bid relative to the spot price for the same type of goods at the spot auction event, when the contract matures,” De Beers said.

The first forward contract was issued in London on Tuesday. Registered customers of De Beers Auction Sales were able to bid for supply up to three months in advance. It is anticipated the contracts to bid for supplies through 12 months will be introduced next year.

“Customers have expressed a desire to secure future supply at auctions so they can plan their activities more effectively and commit to longer-term agreements with their own customers. We see the contracts as the ideal mechanism to deliver this and believe these will be a valuable addition to our customer offering,” said Neil Ventura, senior vice-president, De Beers Auction Sales.

About 10 per cent of De Beers' rough diamonds are sold through its auction platform. “We understand auction forms a small part of the DTC sales window that they use to service SME (small and medium enterprises) clients. The positive effect of this move will be small manufacturers will get an assured supply for a longer period, which will bring stability to their business,” said Vipul Shah, chairman of the Gems & Jewellery Export Promotion Council. “But at the same time, we would like to urge both buyers and seller to use this system prudently so that it doesn’t lead to speculation and overpricing of roughs, which will harm the industry.”

For the first half of this year, De Beers posted a 6.29 per cent rise in rough diamond production. The company's overall rough diamond output rose to 14.295 million carats during this period, compared with 13.449 million carats in the year-ago period.

Sales remained steady during the first half of the current calendar year, with total sales of $3.3 billion  and rough diamond sales of $3 billion.

Central African Republic calls for diamond ban to be lifted

Central African Republic has called for a ban on its diamond exports to be lifted, saying it needs the tax revenue from sales to revive its crisis-crippled economy.
 
The Kimberley Process, a global watchdog set up to stop the trade in "blood diamonds", announced a suspension of certified diamond trading with the country in May, two months after a coalition of mainly Muslim Seleka rebels ousted President Francois Bozize.
"Diamonds have nothing to do with the situation in Central African Republic," said Herbert Goyan Djono-Ahaba, mines minister in a transitional government meant to lead the country to fresh elections.
"Our country was suspended based on risks but there was no proof that diamonds financed the war," he said in an interview on Thursday.
Diamonds are an important source of revenue for the government in Bangui and the ban makes interim president Michel Djotodia’s task of staging polls even more daunting.
About 10% of Central African Republic’s population of 4.5-million has fled the increasingly sectarian violence.
World powers are scrambling to quell the trouble, fearing tit-for-tat killings could escalate into war between the Christian majority and Muslims, who represent about 15% of the population.
Mr Djono-Ahaba said the country had fulfilled the requirements to be reinstated but claimed Kimberley Process experts had declined to visit to verify the government’s efforts.
But Partnership Africa Canada (PAC), a civil society member of the Kimberly Process, said the government was far from having the ban lifted.
PAC research director Alan Martin said the verification mission was unable to go to the country because the government could not guarantee its safety.
"Instability exists in both eastern and western diamond mining areas. It is also evident that the government is not in control of the diamond fields," Mr Martin said.
France is preparing to boost its military presence to about 1,000 soldiers to be followed by the deployment of a 3,600-strong African Union peacekeeping force. The United Nations is also examining the possibility of establishing a peacekeeping mission.
"Blood diamonds", stones used to fund insurgencies, became a global issue in the 1990s during a succession of African conflicts in which their trade financed arms purchases and resulted in human rights abuses.
A public outcry led to the establishment in 2002 of the Kimberley Process, a government, industry and civil society scheme aimed at certifying stones and preventing conflict diamonds from entering the international market.

Global Diamond Players Flock to Zimbabwe

International diamond players, including Botswana registered company First Element Diamond Services (First Element), are flocking to Zimbabwe for opportunities to exploit the country's vast diamond deposits, businessdigest has learnt.

This comes after a Belgian diamond delegation toured the country recently. Zimbabwean officials in turn also toured Antwerp, the diamond capital of the world.
Highly-placed sources said this week First Element, which runs dual tenders in Gaborone (Botswana) and Antwerp (Belgium), was among a visiting group of foreign investors touring the country's diamond deposits.
The company is expected to clinch a deal with the Zimbabwean government that is likely to see the company getting vast diamond claims in the country.
"These Belgians were here and have had two meetings with senior ministry officials about their intentions," said a source who requested anonymity.
Insiders see the move as Zimbabwe's way of paying back Belgium for its critical stance against European sanctions on the Marange diamonds.
First Element is an independent Botswana-registered company which provides diamond cleaning, valuation, sorting and marketing services.
The company has expertise in valuating and tendering run of mine production and has offices in Gaborone, Johannesburg and Antwerp.
First Element last year partnered London Stock Exchange mining junior-quoted diamond mining and exploration company Firestone Diamonds to open a new tender facility at the Antwerp World Diamond Centre.
Zimbabwe's interest in First Element is believed to be driven by the desire to start marketing its diamonds locally after Diamond Trading Company (DTC), a subsidiary of De Beers, relocated its London-based sorting and sales activities to Botswana in November 2013.
In an interview, Mines and Mining Development deputy minister Fred Moyo said a number of investors were keen on Zimbabwe's extractive industry, particularly diamonds, but could not shed light on the specific negotiations with First Element.
"A lot of companies come but I think the permanent secretary is best placed to give details on specific companies because he is the one who deals with that especially at the early stages," Moyo said.

"What I can tell you is that as a ministry we welcome all investors who want to come and invest in our economy, not only in diamonds but in all minerals."
Moyo said government was currently seeking investors willing to make serious commitments towards exploiting the country's Kimberlite diamond deposits.
"We want to balance the two where the alluvial diamonds are being exploited and at the same time we get Kimberlite," he said.
Local donor funder research group Centre for Natural Resource Governance (CNRG) this month reported Russian diamond mining giant, Alrosa, is also believed to be prospecting in Zimbabwe after the discovery of new diamond deposits outside Marange.
CNRG said diamonds have been recently discovered in Bikita and Chimanimani.
The research unit said four kimberlitic pipes rich in diamonds were discovered in Budzi communal lands in Masvingo province's Bikita district near the border with Manicaland Province in March 2013.
Bikita sealed off
In February this year, former Mines minister Obert Mpofu said government had sealed off newly discovered Kimberlite diamond deposits in Bikita to stop illegal mining of the precious stones.
He said some villagers reported that there were diamonds in the Devure Range and the Chinese had already done some prospecting.