De Beers to Limit Production to 40 Million Carats a Year

The following article is published courtesy of IDEX Online

Author: Edahn Golan

De Beers' Jwaneng diamond mine in Botswana, at sunrise

In a drive to extend diamond reserves, De Beers will place a 40 million cap on its annual diamond production starting in 2011. The move will likely drive up the price of rough diamonds, ahead of an expected public listing of the company.

In an interviewed with the Financial Times, De Beers Managing Director Gareth Penny spoke about the company’s production plans. “Do we want to ramp production back up to 48 million carats, given the lack of availability in the future? Diamonds are a treasure of nature that should be properly protected, because there will be less to sell. The reality is that supply cannot keep up, and that will become very accentuated over the next 15 years,” Penny said.

In the past, De Beers was accused of using its diamond stocks to affect diamond prices in the market. Possibly anticipating such an accusation in this context, Penny told the Financial Times “We are not seeking to manipulate anything,” adding “But there is a natural supply-demand imbalance that is leading to certain realities.”

According to analyst Chaim Even-Zohar (IDEX Online February 13, 2010), De Beers prefers leaving diamonds in the ground, instead of mining them. Penny was quoted recently in a number of occasions as saying, “We don’t mind leaving the goods in the ground,” and “We don’t mind extending the life of our mines.”

At current demand, prices may rise in such a scenario by at least 5 percent per year for the next five years, according to RBC Capital Markets analyst Des Kilalea.

De Beers can expect to return to profit as well as enjoy what Penny called “a natural supply-demand imbalance.”

Even-Zohar believes that by early next year, De Beers will seek a public primary listing on the London Stock Exchange, with secondary listings on the Botswana and Johannesburg stock exchanges, and “timed with the beginning of the renewed growth of consumer demand” in the U.S.

The current shareholders, Anglo American (45%), the Oppenheimer family (40%) and Botswana (15%) are not expected to relinquish their control of the diamond miner. Instead, they are seeking to raise money to cover more than $3 billion in debt.

Further, Even-Zohar is speculating that the Oppenheimers may be interested in keeping some of the assets, such as the retail partnership with LVMH, out of the deal, essentially making only the mining operations part of IPO.

Man Says Lost $3M in Diamonds in Florida Mall

This article is published courtesy of Israeli Diamond Industry Blog

Author: Roe Kalb

 

 

 

 

 

 

 

 

No matter how much you try to keep an eye on your belongings when you’re visiting a crowded mall, you still may end up forgetting or losing something, somewhere.

A visit to a Florida mall three years ago saw Chad Davis, of Orlando, Florida, misplace something slightly more expensive than his cell phone – he lost $3 million worth of diamonds.

As Davis tells it, while he was on a shopping trip in a Florida mall in 2007, he accidentally left a bag containing diamonds, packed in a small plastic box, under one of the tables in the food court.

The gems, which were never found, were bought from Belgium diamond supplier Rosy Blue. The company has accused Davis of stealing the gems and the subsequent litigation has driven him to bankruptcy.

Davis’ involvement with Rosy Blue began in 2006, via businessman and diamond trader Eddie Lane. According to court documents, Davis and Lane flew to Rosy Blue’s office in Belgium, and allegedly manipulated the company into thinking that Davis was an established diamantaire with the means to buy diamonds. Rosy Blue sold Davis $6.5 million worth of gems.

Though Davis kept up the payments for six months, the Belgian company now claims that they were made “as a ploy to obtain Rosy Blue’s trust and willingness to sell him more diamonds.”

According to Davis’ version of the events, he stopped at the mall’s food court for lunch and put several shopping bags, including the one containing the diamonds, under the table while he ate. It wasn’t until he got home that he realized the bag with the diamonds was missing. The bag itself was eventually found – empty.

Court records further revealed that while Davis reported his loss to the mall’s security department immediately, he did not file a police report for six days. Davis explained the delay by saying he was “in shock from the loss.”

Davis also claimed that it is possible he was followed by someone, and that that someone may have stolen the bag. Being a diamond broker, he said in his police statement, “Is so high-risk. People are getting robbed all the time.”

Rosy Blue, however, dismissed Davis’ theory as lacking credibility. The company has also filed suit against Lane, who it claims conspired “to defraud Rosy Blue out of millions of dollars worth of diamonds.” The case is still pending.

Realizing that you’ve lost something important – having your bicycle stolen, forgetting your new smartphone somewhere, or finding out that some “good Samaritan” help himself to your wallet – is one of the most frustrating moments one can experience, but overall, we tend to get over it after a few days. One has to wonder how long it would take Chad Davis to get over his astronomical loss.

Police nab culprit in Rs. 4.20 crore diamond heist

The following brief is published courtesy of: Diamond World

The robber claims to have dumped half the loot into a creek

Police have nabbed a precious stone broker alleged to have conducted the diamond heist worth Rs. 4.20 crore at Shringar Diamonds in Opera House, Mumbai. The culprit- Ramesh Mutha (36 years old) had stolen 2,925 diamonds on April 14, 2010 from the company.

The police had received a tip-off that Mutha is due to visit Ratna Deep Compound in south Mumbai to sell part of the loot to a party, reports add. The Crime Branch laid a trap and caught him red-handed and got hold of Rs 2.65 crore worth of diamonds.

Upon confessing to his crime, Mutha said he had made seven duplicate keys from the company entrance to the locks of the safe. Also, he admitted to have dumped the remaining loot into the Bhayandar creek while crossing over it by train. The police said they plan to deploy divers to recover the diamonds. Mutha will remain in police custody until May, 3, 2010.

New mining and rough gemstone export legislation passed in Tanzania

This could lead to Jaipur facing raw material shortage

Courtesy of: Diamond World

Recently, the parliament of Tanzania took a decision to ban export of rough gemstones from Tanzania, reports say. The purpose behind this move is to develop a cutting and polishing industry in Tanzania itself and boost local employment. The gemstones under purview of the new legislation include diamonds, tanzanite, emeralds, rubies, sapphires, turquoise, topaz and others, reports add. At the parliament session, William Ngeleja – Minister of Energy and Minerals said that the decision followed a long drawn discussion on this bill, and has finally been passed.

Under the revised legislation, the mining of gemstones will be reserved for locals; foreigners are required to enter into joint ventures with Tanzanian nationals; it is mandatory for mining contracts to be reviewed every five years, with specific areas set aside by the government to avert recurring conflicts with big miners. Also, Tanzania will not issue new gemstone mining licenses to foreign companies. Current agreements with foreign mining companies remain unchanged. Gemstone producer Tanzanite One (TNZ.L), will not be affected by the new ownership rules.

This new legislation will bear heavy on the Jaipur gemstone industry. Today, cutting and polishing of tanzanite is a major business for the Jaipur gemstone industry, which procures all the rough from Tanzania – the only source for tanzanite.

Rajiv Jain, Vice-chairman, GJEPC, said, “We know that this kind of bill has been passed. The talks at the higher government level have already been initiated and we are trying to find the best possible solution for the trade of Jaipur”.

Jagdish Tambi, KL Tambi & Co., Jaipur, said, “I am hearing about this and I hope that some solution should come out for the same. The Tanzania government is expecting to get employment there but currently it is not possible to cut and polish the gemstone in Tanzania. The tanzanite one sight holders would be benefited from this as the company has a license to export and the new laws are not applicable on them . But this would definitely make the shortage of the raw material, which is anyway tough to procure.”

Sanjay Phophalia, United Jewellers, Jaipur said, “I am aware of this bill but there are lot of uncertainties which would be clear in the due course of time. This should be taken care at the government level and the Ministry should try and help the trade of Jaipur, as the policy if applied could negatively affect the Jaipur manufacturing trade.” Inviato dal dispositivo wireless BlackBerry®

Bhavani Gems manufactures world’s smallest diamond

The following brief is published courtesy of Diamond World

Bhavani Gems, recently created a record of manufacturing the world’s smallest certified cut and polished diamond with 57 facets weighing just 0.0003 carat or 0.00006 grams (3,333.33 per carat). The company has named the diamond as Bhavani Mikro.

The stone is the smallest diamond certified by IGI (International Gemological Institute.) Shri Manjibhai Dholakia, Founder and Chairman of Bhavani Gems adds, “Taking my ethos of innovation as the driving force, I gave my workers the challenge of creating the smallest certified hand cut and polished diamond. Being pioneers in bringing-in new technologies, we felt it was important to test ourselves. Considering our prowess in manufacturing and craftsmanship I am proud of my highly qualified and perfectionist team’s achievement.”

The company has earned a reputation of being innovators in the sphere of diamond processing. Its R&D department is constantly pushing limits to add value to the rough through manufacturing expertise.

Shri Raj Dholakia, a partner in Bhavani Gems states, “Surat is the hub of diamond processing industry in the world and now we have added a star to the already star-studded image. This one-of-its-kind diamond, which actually looks like a grain of sand to the naked. Having 57 facets, this is a unique piece of art and all the industry experts have been appreciating this accomplishment. This record is also acknowledged by “Limca Book of Records”.

AZURE ELEGANCE

The following highlight is published courtesy of Color-n-Ice Blog

Courtesy: Christies Images Ltd., 2010

The highly anticipated New York Jewels Sale at Christies on April 22, 2010 swelled enthusiasm with collectors for two big reasons; a couple of famous gemstones with a pedigree this long went on the block.

THE HEADLINERS
Catherine the Great’s Emerald and Diamond Brooch and the Maximilian Diamond both had histories so intriguing that had not their paper trail been water tight, one could imagine they were indeed reading a roman a clef. Eclipsing ambitious expectations, the brooch earned $1,650,500 US from a winning Middle Eastern collector. The Emperor’s Diamond found a new home at $1,762,500 US, proving that the value of an historical rarity trumps spending concerns even in this market.

THE SCENE STEALER
Not to be overlooked was that majestic blue ice in the form of a 3.43 cushion cut VS1 Fancy Vivid Blue diamond. Fancy color diamond fans realize the dwindling opportunities for finding a natural color diamond in sizes over a half carat, so this stone was also a rare opportunity–and bidders knew it. The elegantly proportioned stone with its culet shaped to mimic the table flaunts its clarity through the cut. The bidding was all done at $3,106,000 US, or double its lowest pre-sale estimate. That’s $905,000 per carat if you don’t have a calculator handy. Oh, you’re welcome.

HOW IT GOT THE BLUES
Diamonds are a marvel of the gemstone world, owing their construction to just one component: carbon. They are the only gem mineral comprised of a single element. In the case of blue diamonds, minute particles of boron impurities in the crystal lend the alluring tint. Most of the time, blue diamonds have a secondary color–like gray or brown which alters the saturation of the stone. Finding a diamond so straight blue is most uncommon, and warrants the laboratory description Fancy Vivid Blue. Just thought you’d like to know.

Courtesy: Christies Images Ltd., 2010

Tanzanite One offers scholarships

The following brief appaeared on The Arusha Times

Author: Happy Lazaro 

TanzaniteOne officials presenting a scholarship cheque to the Mererani Community last week.

A total of 10 children from the pastoral community and small scale miners at Mererani have received four years secondary education scholarship from the Mererani-based Tanzanite One mining company in Simanjiro.

Speaking at the handing over ceremony of the sponsorship fund, the chairman for the 176 disadvantaged children and 135 widows group , Damani Malipe said they had come together  as group to appeal for  donors to help them out in various aspects of life.

He thanked the representative of the Mererani mining area, Soipey Lenganasa, for helping them get the scholarship from Tanzanite One. About  90 percent of the children remained at home as they lacked resources to join schools.

Speaking at the function, Lenganasa said a lot more children needed support and called on the people  to organize themselves into groups that could  readily be supported.

The scholarship children are enrolled at  Benjamin Mkapa, Naisinyai, Terrat and Msitu wa Tembo secondary schools, all in Simanjiro district.

Lenganasa said efforts to seek for other sponsors were underway to cover the other children in that first group.

In his remarks, Tanzanite One Executive Director Zane Swanepoleone said the company had geared itself towards offering social services to the local people in the mining area.

He said the 10 children were only the first batch and more children would be supported. Tanzanite One also inaugurated its education fund for the disadvantage children to build a sustainable base.  

The director called on other companies and organizations to come out in support of the children welfare and brighten their future.