Gemfields – recalibrating supply for a softer market

Faberg-®-Secret-Garden-Ring-500x647
The company delivered results in line with expectations and is positioning itself for further growth.
Advertisements

New mineral, Qingsongite, only inferior to diamonds in hardness

IMG_7906.JPG

Source: Mineweb

Qingsongite, the first boron mineral to be formed in extreme conditions deep in the Earth, has U.S. geologists, as well as their Chinese and German counterparts, interested.

Author: Dorothy Kosich
Posted: Monday , 05 Aug 2013
RENO (MINEWEB)

Up until this month, Qingsong Fang, a professor at the Institute of Geology, the Chinese Academy of Geological Sciences, was probably best known for his discoveries of four new mineral species, along with his discovery of the first diamond in Tibetan chromium-rich rocks in the late 1970s.

Now, he is the namesake for a new mineral, cubic boron nitride or “qingsongite”. Formerly only created through a chemical compound in laboratories, cubic boron nitride (CBN) is only inferior to a diamond in hardness. Under certain conditions, the chemical compound can be harder than a diamond.

The laboratory version of CBN is considered one of the greatest technological advancements for grinding hardened ferrous and superalloy materials, and is classified as a “super abrasive.” It is usually found in grinding wheels and coatings.

The mineral cubic boron nitride was discovered in the southern Tibetan mountains of China within the chromium-rich rocks of the paleooceanic crust that was subducted to a depth of 190 miles and recrystallized there at a temperature of about 2372 degrees Fahrenheit.

“About 180 million years ago, the rocks were returned back to shallow levels of the Earth by plate tectonic processes leading to the closure of the huge Paleo-Thethys ocean—an ancient Paleozoic ocean—and the collision of India with the Asian lithospheric plate,” University of California Riverside geological Larissa Dobrzhinetskaya told UCR Today.

Although the discovery was made in 2009 and involved UC Riverside, the Lawrence Livermore National Laboratory in Berkley, California, the University of Main and institutions from China and Germany, it was officially approved as a new mineral early this month by the International Mineralogical Association. Grants from the University of California Laboratory Fees Research Program and the National Science Foundation also helped support the discovery.

Indian government blocks Zimbabwe roughs

we publish courtesy of Mineweb

Author: Shivom Seth

 

The Indian Government’s Union ministry of Commerce has put the brakes on the import of controversial gems from Zimbabwe and has asked the gems and jewellery exporters and traders to bide their time till the issue is amicably resolved with the Zimbabwe government.

The move is a major setback to the Surat Rough Diamond Sourcing India Limited (SRSDIL), which had inked a deal amounting to $1.2 billion per annum, to import roughs from Zimbabwe.

With India emerging as a big consumer market for diamond-studded jewellery, in addition to being a major exporter, the last two auctions of Kimberley Process (KP) certified goods reflected a healthy participation by Indian diamantaires, especially those from Surat.

In a defiant stand, Zimbabwe has reportedly told newswire agencies on Tuesday, that it will proceed to sell its diamonds since they are  compliant with all the requirements of the Kimberley Process Certification Scheme.

Mines and Mining Development secretary Thankful Musukutwa reportedly told a visiting Norwegian delegation that trade of his country’s roughs would not be stopped by non government organisations and “other hostile nations.”

The minister has said that while Zimbabwe has had “a few problems” with the KPCS, “we have worked our way up and we are very compliant”. The minister has reportedly asked KPCS to stop engaging in politics.

In Surat though, the Indian Ministry’s move has sent out warning bells. “We will have to follow the decision, though the ban will ensure a huge shortage of roughs and will unwittingly lead to large scale smuggling of diamonds,” said Manikbhai Suratwala, a gem exporter, who leases an office in Mumbai’s Zaveri Bazaar area.

Suratwala pointed out that Zimbabwe’s earnings from mineral exports had increased by 25% to $807.2 million during the nine months to September.
“If there was no ban on the roughs, earning from mineral exports could top $1 billion this year,” he added.

However, the Gems and Jewellery Export Promotion Council (GJEPC) has welcomed the move.

“We will adhere to the timeline until a mutual settlement is reached between the  member countries. We do not want to antagonise other importing countries and interested parties,” said a Council member.

Sanjay Kothari, vice-chairman of the Council said that a decision in this regard was taken by the Council since the USA, UK and Australia continue to have reservations over the export of diamonds from Zimbabwe.

Recently, at a Kimberley Process meeting held in Jerusalem from November 1 to November 4, representatives of the government and the Council strongly advocated the lifting of suspension on the export of rough diamonds from the Marange diamond fields. However, despite several delays, no concrete decision has been taken.

Traders have also said that banning diamonds would not help resolve the issue, since diamonds from Zimbabwe would enter the trade channel via other nefarious means. Exporters from Mumbai who are to participate in the gems and jewellery show, Sparkle-2011, scheduled to be held in
Surat on December 12, have maintained that most banned diamonds would find their way to China and India “via alternate ways.”

“More than 50% of Zimbabwe’s diamonds are said to be smuggled out of the country,” said Suratwala. He also alluded to earlier reports that said  Zimbabwe’s Ambassador to Australia, Jacqueline Zwambila, had been recalled to Harare following allegations of stripping and diamond smuggling.

Incidentally, on November 26, a court in Surat, Gujarat, had convicted two Lebanese nationals of smuggling diamonds into the country. The judgement, said experts, revealed how diamonds were used to finance conflicts and human rights abuse in Africa, and were making their way into India. This was the first conviction relating to the smuggling of such gems into the country.

“Hopefully, it should be the last,” said Suratwala. “We would all like an early resolution to this mess, especially since Zimbabwe auctioned a huge cache of diamonds from the Chiadzwa diamond field in August, which went off smoothly. The required certification was obtained.”


India determined to keep upper hand in diamond cutting and polishing

We publish courtesy of Mineweb

Author: Shivom Seth

MUMBAI  –

The Chinese assault on the Indian diamond polishing business, a front opened up some months ago, has raised somewhat of an alarm in the Indian diamond industry. The Chinese have set eyes on the global diamond market and hope to dig their way into India’s 80% share of the world’s diamond cutting and polishing business.

Though the Chinese have officially denied any such move, Indian diamond cutters, most of whom are based in the State of Gujarat, to buttress their point, direct attention to the Chinese efforts to secure a line of supply of the uncut gems from the African continent, eliminating middlemen from Antwerp and Israel.

The Indian exporters are worried that if China succeeds, eventually it could upset their hold on the industry, BizCommunity.com reports. Indians say that China was returning the favour to the African nations by supplying free health aid and infrastructure works.
Liu Jianhua, Deputy Secretary-General of Diamond Branch, the Gems and Jewelry Trade Association of China, told the Global Times recently that there were definitely no such deals or actions between China and some African nations.

On a visit to Africa in January this year, Chinese commerce minister Chen Deming had said that China and African nations always treated each other equally and that years of aid provided by China for infrastructure construction in Africa had been conducted without any political or economic preconditions.

India’s worry

The Indian side has been actively campaigning with its own government, asking it to strike up deals similar to the ones by the Chinese government, in order to procure its own line of rough diamonds from the Congo and other African nations. The campaign is spearheaded by India’s Gem and Jewellery Export Promotion Council.

The size of the Indian gems and jewellery industry is expected to cross $31 billion in 2010-2011. Surat itself is expected to process $18 billion worth of the glittering gems this financial year. But these figures are not helping much to dispel the doomsday predictions in the industry, because of the Chinese assault.

The Indian side fears that if the Indian government does not wake up now, China may soon have the upper hand.

India spends $10 per carat on the polishing and cutting of diamonds, against China’s $17. Expectedly, India wants to retain this edge. But the fact that China itself is a major consumer of polished diamonds besides Hong Kong, US and India, is adding fuel to the onging fire. Polished diamond exports to the Chinese mainland and Hong Kong during the first quarter of 2010 equalled $727 million, 28% higher than the same period a year earlier, according to the Antwerp World Diamond Center.

The Indian diamond story has so far been one of grit and determination. From a mere $8 billion worth of exports in 1999-2000, the Indian gems and jewellery industry has captured about 80% of the global polished diamond share.

Vasant Mehta, chairman of the Gems and Jewellery Export Promotion Council said earlier this week that they expected gems and jewellery exports to cross $31 billion by the end of this fiscal year, coupled with a strong demand for polished diamonds to key export destinations. And everything does not seem to be lost for India.

The Indian government has responded to the efforts of its diamond industry and is now contemplating beating the Chinese at their own game. India and Africa have a long history of trade and commerce, and the Indian government hopes to leverage off this.
India may soon be able to source rough diamonds directly from Botswana, the largest diamond producer in the world, cutting out the middlemen. Earlier this year, Indian Vice President, Hamid Ansari, had also visited Botswana to lay the ground work to facilitate direct procurement of rough diamonds by Indian companies.

Both the nations also signed an agreement to the effect. It will be a couple of years though before the direct line between Botswana and India starts functioning. At present, Botswana’s diamond mining industry is dominated by ‘Debswana’, a  joint venture between De beers and the Botswana government, but if India’s efforts of opening up a direct line does bear fruit, it would fuel growth for the Indian diamond manufacturers in the future.

Setting up base

The Confederation of Indian Industry (CII)’s South Gujarat Zonal Council Chairman Aagam Sanghvi, is of the same opinion saying if the rough diamonds from Botswana came to India directly, it would assist in value addition. The CII is an organisation that caters to the business community.

Botswana is not the only country India has been eyeing. For some time now, India has been trying to procure rough diamonds from South Africa, Namibia and Angola.

Zimbabwe, for example, is believed to be sitting on one of the world’s largest diamond reserves that are estimated to be around 25% of the world’s total resources.

Both India and China are actively chasing that country for a stake in the pie. But the African country’s diamond sector has been mired in controversy over human rights issues in the diamond mines near the border with Mozambique, resulting in most buyers from Western countries ordering a boycott of stones from Zimbabwe.

Frequent political instability in other African nations like Seirra Leone and Ivory Coast do not make them viable options to nations like Botswana, which is Africa’s topmost miner of diamonds. Still, the Indian polishing industry is not averse in taking efforts to keep the supply line flowing smoothly with the other, lesser known African nations.
That is not to say that diamonds are not driving economic growth in the region. The diamond mining industry generates over 40% of Namibia’s annual export earnings and diamond revenues enable every child in Botswana to receive free education up to the age of 13.

Diamonds also account for 33% of the GDP of Botswana. Since diamonds were discovered in Botswana, GDP annual growth rate has averaged 7%. In addition, the revenue from diamonds is instrumental in the fight against the HIV/AIDS pandemic.
Keeping this in mind, the start of the year witnessed a rush among Surat-based companies to set up diamond cutting and polishing units in Africa, in order to secure assured supply of rough diamonds. Russia is another rough producing country where Indian companies have set up units.

“Earlier, Indian diamond companies were setting up manufacturing units only in South Africa,” said Aagam Sanghavi, director, Sanghavi Exports. “But many Indian companies are now eyeing operations in Botswana, Angola and other African countries that produce roughs.”

The director of Sanghavi Exports, which exports polished diamonds, said that this strategy would benefit not only the Indian companies, but also the African nations as their economies depend largely on diamonds.

Shrenuj & Company, whose main diamond cutting and manufacturing facility is in Surat, opened a diamond cutting factory in Botswana in May this year. “Opening a factory in a rough diamond producing country was an important objective to take forward our global manufacturing strategy,” said the company’s chairman, Shreyas Doshi.

As the next step, the company also plans to set up a jewellery manufacturing unit in Botswana.


NMDC diamond auction to fetch over $1 million

We publish courtesy of MINEWEB

MUMBAI – The stage is set. India’s mineral giant, the National Mineral Development Corporation (NMDC) has thrown the floor open and invited bids at its auction on Thursday, for its pear-shaped  34.37 carat diamond, the largest gem ever to be uncovered at its Panna mines in the north-central state of Madhya Pradesh.

NMDC also plans to tender about 40 other diamonds, weighing between 5 and 30 carats, which are yet to be valued, at its two-day auction which commenced in Mumbai on September 16. Some 9,700 carats of rough diamonds are up for grabs, with the company expecting to raise over $1 million from the auction. The auction of the largest gem is not included in this.
The Panna mines at Majhgaon are considered to be Asia’s biggest mechanised diamond mines, with its diamonds rated next to those produced from South African mines. The mine produced a 32 carat diamond in 2005 and a 30.30 carat diamond in 2003. Officials said the mining operations had shut down in 2005, due to non-clearance by the forest authorities and approvals from the adjoining wildlife sanctuary. Operations resumed in August last year, after the firm received a conditional nod from the Supreme Court of India.
Due to the dislocation, the company produced only about 17,000 carats last fiscal year, against a target of 35,000 carats. The Panna mines have an estimated reserve of 12 lakh carats of diamonds. The company plans to produce close to 1 lakh carats of diamonds in 2010-11.
NMDC is an India-based iron ore producer and exporter, operating its mines in Chhattisgarh and Karnataka. The company operates in two business segments: iron ore and other minerals and services. At the start of the year, the firm had said that it had found traces of diamond deposits in Orissa, Andhra Pradesh and Karnataka.
In association with top diamond producer De Beers, NMDC noted the possible diamond deposits. Surveys are also underway by both the companies in these states, to detect gold deposits.
The companies’ explorations in the three states resulted in the discovery of 41 kiberlites and 13 lamproite pipes, which hint at the existence of more diamond deposits. Kimberlite and lamproite are solidified volcanic magma and work as elevators to bring diamonds with other minerals to the earth’s surface.
kimberlite and lamproites were also discovered in Kalahandi, Nawarangpur, Nuapada and Bolangir districts of Orissa, and in Kurnool, Prakasam and Anantapur districts in Andhra Pradesh. Exploration by a private firm, CRA Exploration India Pvt Ltd, indicated the discovery of several mineralised zones in Anantapur and Kurnool districts. In Karnataka, these were discovered in the Gulbarga district.

Rio Tinto to spend $803m at its Argyle diamond mine in W. Australia

We publish courtesy of Mineweb

Rio says it will use the money to develop an underground mine below the existing open pit which will allow it to ramp up production to reach 9 million tonnes of diamond-bearing ore a year within two years from 2011

MELBOURNE (REUTERS)

Global miner Rio Tinto (RIO.AX: Quote)(RIO.L: Quote) announced plans to expand its Argyle diamond mine in Western Australia on Tuesday, the latest step in its plan to spend about $13 billion through the end of 2011 to boost growth.

Rio Tinto said it plans to invest $803 million to develop an underground mine under the existing open pit, ramping up production from 2011 to reach 9 million tonnes of diamond-bearing ore a year within two years.

The project, put on hold in 2009 due to the global financial crisis, will expand the life of the world’s largest mine for pink diamonds to at least 2019 as the company looks to capture burgeoning demand.

“A significant supply gap is expected to emerge in the medium to long term and the outlook for demand is strong, driven by the growth of emerging markets,” Rio Tinto diamonds and minerals chief executive Harry Kenyon-Slaney said in a statement.

Rio Tinto shares rose 0.4 percent to A$75.64, in line with the broader market .

The Argyle investment follows Rio Tinto’s approval in August of a $1.6 billion expansion at its Hope Downs iron ore project in Western Australia, with the company back on a growth path after slashing a crippling $40 billion debt pile.

The company also picked up another 5.3 percent stake in Canadian miner Ivanhoe Mines (IVN.TO: Quote), its partner in the massive Oyu Tolgoi copper and gold project in Mongolia, boosting its shareholding to 34.9 percent through the conversion of a convertible credit facility that matured on Monday. [ID:nN13206484]

Under the agreement the shares were priced at $10 a share, a 47 percent discount to Ivanhoe’s (IVN.N: Quote) last trade. (Reporting by Sonali Paul; Editing by Ed Davies)

© Thomson Reuters 2010 All rights reserved

Gem Diamonds finds another massive stone at Letšeng

We publish courtesy of Mineweb

Author: Lawrence Williams

The Letšeng diamond mine high in Lesotho’s Maluti Mountains is one of the world’s most consistent sources of high quality large diamonds and has just produced another mega stone.

Gem Diamonds, which works the big Letšeng la Terai diamond pipe in Lesotho has announced today that it has recovered yet another mega diamond – a 196 carat high quality (top colour and top clarity) white stone which is likely to fetch a major premium when it is sold.

Without the occasional large diamond find, the Letšeng pipe would probably be sub-marginal at best, but it does have a history of producing the occasional big stones on a relatively consistent basis and the effect of these on the mine’s economics is very significant.  As Gem notes, since its acquisition of Letseng from JCI in mid-2006 it has produced three of the world’s twenty largest recorded diamonds, namely, the 603 carat Letšeng Promise, recovered in August 2006, which sold for US$12.4 million; the 493 carat Letšeng Legacy, recovered in September 2007 which sold for US$10.4 million; and the 478 carat Light of Letšeng, recovered in September 2008, which sold for US$18.4 million.

Commenting on the find, Gem’s CEO, Cliff Elphick, said “Letšeng continues to live up to its reputation as a unique producer of exceptional diamonds and the recovery of this remarkable 196 carat white diamond reinforces its position as one of the great mines in the diamond industry. In order to increase the returns from this world class asset, management is focused on a number of workstreams which aim to substantially expand production and increase value at Letšeng.”

Gem Diamonds owns 70% of Letšeng Diamonds in partnership with the Government of the Kingdom of Lesotho, which owns the remaining 30%. Operated by De Beers between 1977 and 1982, Letšeng reopened operations in 2004 and was acquired by Gem Diamonds in late 2006 for US$118.5 million.

The mine, located in the Maluti Mountains, is the highest diamond mine in the world at an average altitude of 3,100m above sea level and is one of the coldest places in Africa which makes for extreme working conditions.

The mine is extremely low grade (less than 2 carats per hundred tonnes) and is well known for producing these large diamonds, having the highest percentage of large diamonds (greater than 10.8 carats) of any kimberlite diamond mine, giving it the highest dollar value per carat of any such mine.  Without the recovery of these big stones it would not be economic.