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Tag Archive 'Gem Diamonds'

Jun 15 2009

Diamond prices on the mend

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This article might (or might not) have appeared in the Financial Times this morning. It was written by a German journalist and appeared in the Financial Times Deutschland. I thought it was important enough to translate and publish anyway. Here we go:

Diamonds sparkle (again)

Precious stone dealers get higher prices at auctions than in previous month

by

Christine Mai, Frankfurt

The global recession-hit market for diamonds has shown first signs of recovery. But, experts warn against premature optimism, because the retail trade still shows no signs of improving. “The upswing is driven by re-stocking of supplies and will lose momentum without a breakthrough on the retail side of the jewelry market,” said diamond analyst Des Kilalea of RBC Capital Markets in South Africa.

The excitement was big when the world’s biggest diamond producer De Beers halted almost all mining activity in the first quarter of 2009. Now production rises again, while prices seem to have found their bottom. But, analysts warn demand remains weak.

With the economic downswing the demand for diamond jewelry collapsed and pulled prices down – for cut and polished diamonds as much as 30%. Jewelry concern Tiffany & Co registered a drop in profits in the first quarter of almost two-thirds to $24.3 million. Producers reacted with shorter working hours and the temporary closing down of mining operations.

In the first three months of the year De Beers stopped mining almost completely – production dropped by 91% to 1.1 million carat (one carat equals 0.2 gram). The market was hit especially hard by the severity of the downswing in the USA, where almost half of the demand for diamonds comes from.

This had terrible consequences for countries mining and processing diamonds. According to sector representatives, about 400,000 jobs had been lost in the Indian diamond cutting and polish sector since October last year. In a few countries, especially in Africa, the crisis is existence-threatening. For instance, Botswana gets about half its gross domestic product from diamonds. To bridge the crisis, Botswana last week took up a credit line of $1.5 billion from the African Development Bank.

Positive signals have, however, been surfacing in the past few weeks. According to information provided by the sector, the diamond producer Gem Diamonds got about $1,600 per carat at an auction for uncut diamonds in May, after only about $1,100 was paid at the previous auction. Even this price was still way below the $2,500 per carat obtained in the first six months of 2008.

Gareth Penny, head of De Beers, reckons the bottom has been reached. Prices stabilised in April and May, he told diamond traders in Antwerp last week. “December and Xmas 2009 will be better than December and Xmas 2008,” was his forecast for the most important sales season of the year.

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Feb 09 2009

Protest action against mining in Bushmen reserve

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Opposition against the planned mining of diamonds by Gem Diamonds in an area of Botswana traditionally inhabited by Bushmen is picking up momentum. Also read this article.

Tomorrow (10/2) human rights group Survival International will organise a protest outside Graff Diamonds’ flagship store in London, to get Laurence Graff to rethink his support for the controversial diamond mine. He owns 9% of Gem Diamonds. 

To read about other protest actions organised by Survival International in support of the Bushmen, read here.

Tomorrow’s protest action will take place from 4.30 pm to 6 pm at 6-7 New Bond Street, W1S 3SJ in London.

On 31 October last year I reported De Beers had withdrawn from the area in reaction to the international outcry.

Also be sure to read Survival International’s blog posts here and to watch the video.

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Nov 13 2008

Another big one found in Lesotho

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How is it possible that De Beers never noticed Lesotho’s potential as a diamond producer? That question arises when one reads this article about another huge diamond found in Lesotho by London-based Gem Diamonds and Letseng Diamonds. This is the umpteenth big diamond discovery in Lesotho in the very recent past…the small country is fast turning into a diamond producer of some note.

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Nov 08 2008

UK church group blows whistle on BHP Billiton

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A church group based in the UK has released a report accusing mining conglomerate BHP Billiton of bribery, intimidation and under-the-table payments to officials in the Phillipines, where the company wants to develop a nickle mine and build a processing plant. [Read on]

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Oct 31 2008

De Beers withdraws from Kalahari

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The diamond miner and marketer De Beers has stopped mining for diamonds inside the Kalahari Nature Reserve, Botswana, home of a group of about 1,000 bushmen. But, Gem Diamonds, a diamond miner with a major shareholder in Kuwait, is still there – and apparently harrassing the local bushmen population.

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