By Chaim Even-Zohar. Reprinted from Diamond Intelligence Briefs by special arrangement. Read the second part of this article here.
With its industry overview announcing that, "Exports of Swiss watches fell in the first half of 2016 to CHF 9.5 billion ($9.8bn) from CHF 10.2 billion ($10.5bn) in 2015. This is the lowest level since 2011. In July and August the decline continued.
Opportunities for growth within our industry will not be possible if we, as industry players, do not work together through partnerships. If we do not engage as a region, we are at risk of a missed opportunity that might lead to regional competition, to the detriment of our industry. Whether we are regulators, producers, cutters and polishers or jewellery manufacturers, until we recognise and increase our interdependency as partners, we will never get our local diamond industry back on its feet.
- De Beers Consolidated Mines CEO Phillip Barton, on importance of regional integration in the Southern African Development Community, at South Africa Diamond Indaba
De Beers' International Institute of Diamond Grading & Research (IIDGR) will showcase its PhosView™ screening instrument in the UK for the first time at the UK Jewellery Conference at the East Midlands Conference Centre on October 3-4 2016. The PhosView™ was launched at the Hong Kong Gem & Jewellery Fair from September 14 to 18. Demand for the technology has been "particularly strong in the first two weeks it has been available to purchase," De Beers said in a statement.
Russia may have been too generous in setting the price of shares in diamond miner ALROSA in a sale earlier this year and "leaving 20 billion rubles ($313 million) on the table" after its biggest asset sale in three years, according to Bloomberg.
The board of directors of South African diamond mining firm Trans Hex Group has advised its shareholders to reject a takeover bid from retail tycoon Christo Wiese, the country's richest man. The company said that a panel of independent members found the offer underpriced the miner.
Sierra Leone exported 347,070 carats of diamonds in the first half of this year, according to the country's Diamond Dealers Club. Club President Federico Candiano told Rough & Polished that the country generated $188.9 million in revenue during the period. The figure includes $145,011,552 from mining licenses and $43,851,404 was from mining trader licenses. “The second half [of 2016] should mark a positive increase due to the seasonal washing in the rainy season,” said Candiano.
The Kimberley Process (KP) has declared three new ‘compliant zones’ in the Central African Republic, meaning diamond exports from those regions can resume after a suspension of more than two years, writes Rapaport News following a statement by the KP. The KP’s monitoring team approved shipments from the sub-prefectures of Boda, Carnot and Nola in the west of the country on September 19, the KP announced. Bin Sulayem has communicated the decision to all KP participants and observers.
De Beers has won a domain name dispute at the World Intellectual Property Organization (WIPO). According to Bird & Bird, the law firm that represented De Beers, this is the first decision on a .feedback generic top-level domain (gTLD) registration, worldipreview.com reported.
A major diamond ring offered for sale by Sotheby’s at its September 22 Important Jewels auction in New York City failed to sell, reports JCK. The headline item, a 27.35-carat D color, VS2 diamond, had an estimate of $2 million–$2.5 million. Sotheby’s did not provide the top price offered for the item. The auction raised a total of $8.6 million.
Alluvial diamond miner Rockwell Diamonds, with operations in South Africa, is in a “state of despair”, its incoming chief executive Tjaart Willemse said last week in the release of quarterly results to end-August., adding that the company will implement a comprehensive operational turnaround. The statement from Willemse reads: “From my observations to date on the general health of the business and understanding of the main contributors to its current position, it is clear that the business finds itself in a state of despair for a number of reasons.
Top managers of upscale jeweler Tiffany & Co., paid a familiarization visit to ALROSA. The delegation headed by Vice President and Chief Operating Officer of Tiffany & Co.'s Diamond Division Michael Bergkoetter became further acquainted with ALROSA's diamond mining cycle. The delegation visited the Internatsionalny underground mine, Nyurbinsky and Botuobinsky open-pit mines, the processing plant at Nyurba division, and ALROSA's Diamond Sorting Centre. ALROSA entered into a diamond supply agreement with Tiffany & Co. in 2012.
Just a week after finding a 104-carat Type IIa, D-color diamond which was the fourth stone over 100 carats discovered this year, Lucapa Diamond Co. Ltd., an ASX-listed Australian company based in Perth, has uncovered an even bigger exceptional diamond from its Lulo Project in Angola. Lucapa said it unearthed 172.67-carat Type IIa, D-color stone. It is the fifth 100+ carat diamond found at the mine this year, and the sixth this year.
Gemstone miner Gemfields reports a jump in revenue to $193.1 million for the year ended June 30 from $171.4 million a year before. Meanwhile profit after tax almost doubled from a year before to $23.5 million from $12.3 million. The firm had cash holdings of $41.5 million compared with $28.0 million and the cost of its gemstone and Fabergé inventory was $107.2 million from $101.1 million last year.
Mining company Rio Tinto, a leading producer of smaller rough diamonds for the Indian market, aims to focus on the affordable diamond jewelry sector in India, according to a company official. "Affordable diamond jewelry has an average ticket price of Rs. 35,000 ($520)," said Vikram Merchant, director of Rio Tinto's India representative office. "This segment roughly constitutes 50 percent of the diamond jewelry industry in India."
Johan Dippenaar, the CEO of South Africa-based Petra Diamonds, gives an overview of the history and operations of the mining firm as it heads towards completing a seven-year, $1 billion expansion program that will triple its production. Dippenaar, in London to meet investors after presenting Petra’s 2016 financial results to investment firms, explained to the Daily Telegraph that Petra’s business model is based on acquiring old mines from De Beers and extending their life. “These mines – Cullinan, Finsch, Kimberley – that’s what started De Beers,” he says.
Last week, De Beers published its second "Diamond Insight Report", analysing the current state and future outlook for the global diamond industry - 'from mine to finger' as they say.
Dominion Diamond Corporation reports the restart of the Ekati process plant and the sale of an exceptional diamond recovered at the Ekati diamond mine earlier this year. The Ekati process plant resumed operations at full capacity on September 21. Plant operations had been suspended since a fire that occurred at the Ekati process plant on June 23. During this time, the company worked to lessen the impact of the fire on production and cash flow for the current fiscal year.
Four Israeli diamond dealers have appeared in court in Tel Aviv accused of holding close to 100 million shekels ($21 million) at HSBC Switzerland that was not reported to the Israel Tax Authority authorities. The unnamed diamond dealers allegedly held undeclared accounts at the bank, the tax authority said on Thursday, Reuters reported. A Tel Aviv court later agreed to release them after posting bail. All four have denied the allegations.
Russian diamond miner ALROSA reports that sales of rough by the ALROSA Group in August were 58% higher than the same month last year at $243.0 million. Meanwhile, polished diamond sales for the same period amounted to $6.3 million.
"ALROSA has noted a stable market recovery trend after 2015. However, the company's market outlook is still moderately conservative," the firm said in a statement. "In August 2016, the company observed no seasonal slump in demand for rough diamonds characteristic of this month," said company Vice President Yury Okoemov.
Following downward-trending second quarter reports from major U.S. jewelers such as Signet, Zales (part of Signet) and Tiffany & Co, sales at specialty jewelry stores also fell in July, reports Rapaport News. "Sales fell 2.2 percent to $2.1 billion across outlets selling only jewelry and watch products during the month, according to the U.S. Census Bureau.
The South African economy is in serious danger of losing its investment-grade credit rating and must reassure investors of its commitment to regulatory certainty and fiscal stability, said De Beers CEO Bruce Cleaver said. “South Africa is in a slightly difficult place right now,” Cleaver said in an interview with Bloomberg TV at the U.S.-Africa Business Forum in New York on Wednesday. “I think the threat of a ratings downgrade is serious.”
A New York security guard who took $5 million in diamonds accidentally thrown on a pile of garbage by construction workers outside a jewelry store will avoid jail time by agreeing to a plea. Wilfred Martinez, 48, pleaded guilty to grand larceny in Manhattan Supreme Court in exchange for six months probation, the New York Post reported.
With the diamond industry - Canada's in particular - and news media awash with the big story of the official opening of De Beers'/Mountain Province's giant new diamond mine in the NWT, Gahcho Kué (the world’s largest new diamond mine in the last 13 years which is expected to produce approximately 54 million carats of rough diamonds over its lifetime),
New York-based Analytical Gemology & Jewelry (AG&J) is applying for a patent for a method of detecting synthetic diamonds that the lab claims is more efficient than existing techniques, according to Rapaport News. The method identifies stones that luminesce, or give off light, when exposed to ultra-violet light, which is a feature of synthetic diamonds.
Koin International, a specialist rough and polished diamond tender house, will hold a diamond tender in Antwerp from 26 – 30 September for multiple original rough productions. The productions include large single stones from the Namakwa North West Mine in South Africa as well as orginal stones from Guinea; Koin will have over 50,000 cts of original Angola production on offer (Koin assortments) from ANGOLA F2M, and full Run of Mine from Democratic Republic of Congo.
Russian mining giant ALROSA introduced an innovative detection device for polished diamonds at the September Hong Kong Jewellery & Gem Fair. According to the press release: As part of the measures to protect the natural diamond market from illegal mixing of natural and synthetic diamonds, ALROSA and the Federal State Bugetary Institution “Technological Institute for Superhard and Novel Carbon Materials” have developed a series of innovation devices for detecting polished diamonds and diamond jewelry.
The Indian Cabinet has approved the winding up of the Hindustan Diamond Company Private Limited (HDCPL), a joint venture between the government and the De Beers Group, according to a press statement. Set up in 1978 as a 50:50 joint venture between the two parties, HDCPL was engaged in sourcing and procuring diamonds and aimed to make rough cut diamonds available to the diamond processing industry, especially small and medium jewelry exporters.
Bruce Cleaver, CEO, De Beers Group, joined world leaders, including US President Barack Obama, US Secretary of Commerce Penny Pritzker, US Secretary of State John Kerry, Michael R. Bloomberg, various African heads of state, and other private sector CEOs from the US and Africa, to examine the partnerships that have led to deepened business relationships and the exciting potential for growth in Africa. The meeting took place in the framework of the second US - Africa Business Forum, hosted by the US Department of Commerce and Bloomberg Philanthropies at the Plaza Hotel in New York.
According to statistics published by India's Gem & Jewellery Export Promotion Council (GJEPC), as summarized by Executive Director Sabyasachi Ray, India's cut and polished exports continue to make a gradual recovery in the first five months of fiscal year 2016 (April - August) after seeing polished exports decline 13.66% during the fiscal year 2015.
Diamond and jewelry tycoon Lev Leviev has won more than $100 million from an arbitration panel in battle against his former business partner, the Julius Klein Group, The New York Post and other sources report. Lawyers for losing side tried but failed to have the court documents sealed in the Manhattan federal court case. But Judge Andrew L. Carter Jr. agreed only to redact the amount of the award, which the Post cited industry sources as saying was “well north of $100 million.”
Lucapa Diamond Co. Ltd., an ASX-listed Australian company based in Perth, has uncovered yet another exceptional diamond from its Lulo Project in Angola and believes it is closing in on the original source of the gem. The 104-carat Type IIa, D-color diamond is the fourth stone over 100 carats Lucapa has found this year and the fifth overall.
Russian diamond mining giant PJSC ALROSA held a meeting with clients and partners at the September Hong Kong Jewellery & Gem Fair. The company, which produces about a quarter of global supply, presented its vision for the development of the diamond market with an increased focus on the possible impact of the increased manufacture of synthetic diamonds on the natural diamond market. At a panel discussion, key market participants exchanged opinions on the risk of illegal mixing of synthetic and natural diamonds, it said in a statement.
Auctioneer Bonhams has sold a rare oval-cut blue diamond weighing 3.81 carats for £2,322,500 ($3 million, or $792,450 per carat). The Fancy Intense blue diamond comes from a private British collection. Jean Ghika, Head of Jewellery for Bonhams UK & Europe, said: “Blue diamonds account for only 0.004% of all diamonds mined and are therefore exceptionally rare and remain highly sought after. The price achieved in today’s auction demonstrates that the global appetite for colored diamonds remains as buoyant as ever.”
DiamondCorp, the Southern African diamond mining, development and exploration company, has announced that it has sold a total of 7,121 carats (cts) of diamonds from the Lace diamond mine in the Free State province of South Africa in the current three month period through a combination of direct sales and competitive tender, earning total revenues of $782,455. The company sold 4,863 cts of diamonds recovered from kimberlite mining and 2,258 carats of diamonds from tailings production and fine diamonds less than 1.25 mm.
HRD Antwerp has announced in a press statement that Peter Macken has been relieved of his duties as CEO as a result of differing strategic views. The decision was taken by mutual agreement and is effective immediately. HRD Antwerp’s Executive Committee thanked Mr. Macken for his services and wishes him all the best in his future endeavors and professional career. At the request of the HRD Antwerp Board of Directors, Mr. Ari Epstein, a statutory board member at HRD Antwerp and CEO of the Antwerp World Diamond Centre, has been appointed President of the HRD Antwerp Board of Directors.
The income tax department conducted raids and surveys on over 50 jewelers and bullion traders across Maharashtra in the last week for alleged tax evasion, writes The Indian Express, while sources said similar tax raids have been conducted on over 100 jewelers and bullion traders across the country. In Mumbai alone the tax department raided and surveyed at least 17 wholesale jewelers on September 14. According to a jeweler who was surveyed by the tax department, the tax officials have directed the jewelers to declare undisclosed excess stocks and cash.
"Just over two decades in the making, Canada's newest diamond mine is set to officially open Tuesday (September 20) in the N.W.T. at a ceremony involving Indigenous leaders, mining and territorial officials," writes Kate Kyle for CBC News. The mine came online and starting producing diamonds last month, with its first commercial production set for the first quarter of 2017, and is estimated to be one of the 10 biggest diamond mines in the world, project to deliver 4.5 million carats annually over a 12-year life span.
Kennady Diamonds Inc. has recovered 1,278 carats of diamonds (+0.85mm) from 612 tonnes for a sample grade of 2.09 carats per tonne from its large diameter drilling program focused on the north limb of the Kelvin kimberlite. The miner said the result is very similar to the 2015 bulk sample grade of 2.02 carats per tonne from the south limb. Kennady Diamonds owns 100 percent of the Kennady North diamond project located in Canada's Northwest Territories immediately adjacent to the Gahcho Kué diamond mine currently being operated by De Beers and Mountain Province Diamonds.
ALROSA Vice-President Yuri Okoemov said that the diamond miner is developing a marketing policy concept for the upcoming three-year sales period. It will take into account developments over the past three years and the changing global markets, he said in an interview with the company's corporate magazine. Okoemov did not reveal any details about ALROSA's sales policy for the next three-years, but noted that the company expects "to maintain its share of sales under long-term contracts at a level of not less than 70%".
With diamond traders heading home as the Hong Kong Jewellery & Gem Fair came to an end on Monday, most appeared to be relatively optimistic though cautious ahead of the approaching holiday sales season. Demand for diamonds in the Far East remains soft due to the economic slowdown in China and an ongoing drop in tourists arriving in Hong Kong, Rapaport News reports.
Pangolin Diamonds Corp has announced that their drilling program at the Motloutse Diamond Project, located 150 km east of the largest diamond mine in the world, the Orapa Diamond Mine in Botswana, intersected no kimberlite during their August drilling program.
The second Jewelry Industry Summit to advance sustainability and responsible sourcing initiatives will take place from January 29 to 30 in Tucson during the city's annual gemstones fair, organizers said. The meeting aims to build on the conclusions of the first summit held in New York in March where a broad range of issues and proposals were made. The New York summit concluded with a list of projects that various attendees committed to continue to advance.
JCK's award-winning news director Rob Bates sat down for a chat with Internet radio program "The Daily Beat" on Breakthru Radio (BTR) to talk all things diamonds, and in particular the Kimberley Process and diamonds in American culture.
BTR: What effect did the movie Blood Diamonds (2006) and reports after that have on the diamond industry?
Petra Diamonds Limited announced that revenue edged up just 1% to $430.9 million in its preliminary results for the year ended June 30. Net profit after tax, however, jumped 12% to $66.8 million. The miner, which operates four former De Beers mines in South Africa and one in Tanzania, also reported that net debt more than doubled from last year to $384.8 million.
One of the key assumptions in De Beers' "Diamond Insight Report 2016" is that the surge of diamond demand in China - the second largest diamond market in the world - will continue, but at a slower pace than in recent years. This is understandable, as diamond demand in Mainland China doubled its share from 7% in 2008 to 14% in 2015.
The Fancy Color Research Foundation (FCRF) is launching what it says is the first ever industry Fancy Color Rarity Evaluator (FCRE™). The Evaluator provides proprietary rarity estimates for all yellow, pink and blue fancy color diamonds based on the diamond’s carat weight, color, color intensity, clarity and shape. It will provide a range estimate for the number of such diamonds unearthed in mines each year and will allocate them a Rarity Level, from Common to Super-Stone.
With the grand opening of the Gahcho Kue mine, the largest new mine to come on line in recent years, set for Tuesday, a union representing culinary and janitorial workers say they are considering a strike which the union leader says could shut down the camp. The threat of industrial action follows stalled negotiations with the contractor employing them, according to a report by CBC Canada. The mine is co-owned by De Beers Canada (51%) and Mountain Province Diamonds (49%) and began mining its first diamonds last month.
We’ve got a mine, we’ve got grade, we’ve got the carat value and we’ve got $1.5bn of diamonds in the ground to be mined in the next few years. To date, the amount of kimberlite that’s been mined and processed in ramp-up is really only equivalent to one month’s worth of production of ore from the first block. But already we’ve had a 22 carat stone and lots of plus-eight carat stones. It’s only a matter of time before we pull in a 50 carat stone or a 90 carat stone. It’s a numbers game because we know they’re there.
- Diamondcorp's Paul Loudon on overcoming initial obstacles and long-term value of Lace Mine (S. Africa) on eve of first Antwerp tender
Lucapa Diamond Company and its partners, Angolan state-owned diamond miner Endiama and Rosas & Petalas, say that alluvial mining operations at the Lulo mine in Angola are proceeding ahead of plan. Lucapa said the recent investment in earth-moving vehicles and equipment saw Lulo achieve record monthly processing volumes in August. Diamond production for August was 2,882 carats, the second-best month on record. The August production included 39 special diamonds – stones weighing 10.8 carats and more – up to 80.5 carats in weight.
"On concluding the second ‘Africa Dubai Precious Metals Forum’ in Accra, KP Chair Ahmed Bin Sulayem met with H.E. President John Dramani Mahama to discuss Kimberley Process matters and to share the KP Chair Mid-Term Report," writes Emirates 24/7 News. Ghana is a full KP member, has the 11th largest reserves of diamonds in the world and is the 14th largest producer in Africa.
The Hong Kong Accredited Diamond Exchange (HKADE), backed by a renowned Hong Kong serial entrepreneur Mr. Shih Wing-Ching, provides the first online peer-to-peer (P2P) global diamond marketplace with its reliable verification service and unique features for investment consideration with the support of non-physical settlement, according to a company press release. "There is a big gap between the retail price and resale price of diamonds," Mr. Shih stated. "This is because information about the diamond market is not always clear.
The Natural Color Diamond Association (NCDIA) will launch a U.K. chapter in London to facilitate networking among members of the trade and increase the public’s awareness about colored stones, writes Rapaport News. “Whilst the public is increasingly knowledgeable about white diamonds, there is still a lack of reliable information about natural-color diamonds,” the NCDIA said. “The NCDIA seeks to address this by disseminating the most up-to-date gemological information to their members and supplying them with trustworthy marketing and promotional tools.” The first U.K.
Hong Kong Jewellery Magazine takes an in-depth look at the adjustments the diamond industry is, or should be, implementing in order to accommodate the changing economy and consumption habits in an environment where the diamond industry "at large is under the gloom of the stagnant economy that impedes buying sentiments in end consumers." With the assistance of three industry insiders - Erik Jens, head of the diamond and jewelry division at ABN AMRO Bank, Nissan Perla, founder of Olympic Diamond and the Diamond Registry, and Lawrence Ma, chairman of the Diamond Federation of Hong Kon
Diamond industry analyst Paul Zimnisky writes that there few remaining diamond development projects in the pipeline big enough to have an important impact on global production following the development of the Gahcho Kué in Canada and Rio Tinto's withdrawal from the Bunder project in India. Gahcho Kué (51% De Beers/49% Mountain Province Diamonds), the world’s largest new diamond mine, is due to start commercial production in Q1 of next year with annual output of 4.5 million carats and a 12-year lifespan.
Chow Tai Fook, the world’s largest publicly traded jewelry chain, is warning that the jewelry market remains challenging even though it expects a decline in sales to ease off in the second half of this year. It also hopes to benefit from easier comparisons in the second half with the same period of 2015. “This year is still a challenge because the volatile global economy is affecting buying sentiment as a whole,” Kent Wong, the managing director of Chow Tai Fook Jewellery Group, told Rapaport News.
De Beers today published its "Diamond Insight Report 2016", leading off with the following: "De Beers first published its Diamond Insight Report in 2014. In the two years since, much has changed, but the strong diamond industry fundamentals remain the same." Nonetheless, 'With the first half of 2016 showing signs of more stable conditions returning, it is clear that volatility in the diamond sector is not a short-term phenomenon, but the new normal," says CEO Bruce Cleaver.
(izvestia.ru) Translation by Rough-Polished: According the Izvestia Daily, Vice President of ALROSA Rinat Gizatulin said that the Russian diamond miner is exploring the possibility of establishing its own operation to produce synthetic diamonds. However, analysts doubt ALROSA will be interested in starting its own production as an independent business: rough diamond production is highly profitable for ALROSA, and it makes no sense for the company to ‘waste its time’ on producing lab-made diamonds on an industrial scale.
Richemont, which owns the Cartier jewelry and watches maison among other units in the luxury sector, issued a profit warning on Wednesday after recording a drop in sales. The results reflected the challenges luxury goods companies face from weaker demand in Asia and a decline in tourism in Europe, the Wall Street Journal reported. Geneva-based Richemont said sales fell 14% for the five months through August from the previous year at actual exchange rates. At constant exchange rates, sales declined 13%.