The US has added the prominent jewelry brand Miuz and the diamond cutter Kristall to its list of sanctioned companies in Russia.
Kristall, Russia’s largest diamond cutter, is now on the Specially Designated Nationals (SDN) List administered by the US Treasury Department.
Alrosa, its parent company has been on the list since April 2022, shortly after Russia invaded Ukraine. Kristall, based in Smolensk, has been part of the Alrosa group since 2019.
Miuz Diamonds, which has production facilities in Moscow and Perm and a chain of 300 retail outlets, has also been added to the list.
Miuz is part of the Ruiz Group of diamond and jewelry enterprises, linked to Israeli billionaire Lev Leviev.
It is not clear why the companies were not sanctioned sooner.
Kristall and Miuz are among almost 400 individuals and entities in Russia and beyond its borders that were added to the SDN list last Friday (23 August).
“Russia has turned its economy into a tool in service of the Kremlin’s military industrial complex,” said Deputy Secretary of the Treasury Wally Adeyemo, announcing the additions.
“Treasury’s actions today continue to implement the commitments made by President Biden and his G7 counterparts to disrupt Russia’s military-industrial base supply chains and payment channels.”
The Office of Foreign Assets Control (OFAC) has issued new licenses under the Russian Harmful Foreign Activities Sanctions Regulations, allowing for the sale of diamond jewellery and loose gem-quality diamonds imported before recent sanctions were implemented. This significant policy shift permits goods that were previously prohibited to re-enter the market.
Under the new guidelines, diamond jewellery purchased before March 1, 2024, as well as loose diamonds of 1 carat or larger bought before that date, and those of at least 0.50 carats purchased before September 1, 2024, can now be sold. The relaxation for loose diamonds will remain in effect until September 1, 2025.
However, starting September 1, 2024, the next phase of G7 diamond sanctions will impose restrictions on all goods of 0.50 carats or above from Russia, regardless of where they are cut and polished. This phase of sanctions is set to take effect next Sunday, despite substantial opposition from various industry stakeholders.
In response, the Jewelers Vigilance Committee has reported that the United States is considering supporting a delay in the implementation of these sanctions. This potential delay, which aligns with the European Union’s proposed extension to March 1, 2025, aims to provide additional time to resolve the intricacies of the sanctions and their impact on the diamond trade.
Assessing the value of a diamond is a job that’s been done by eye for centuries.
But artificial intelligence (AI) is now so sophisticated that it can do the same task faster, cheaper and more accurately.
There can be a huge difference in value even between two diamonds of the same size. That’s why a whole industry has developed, dedicated to grading them.
But advances in machine learning have now made computers more reliable than humans, according to Sarine, a diamond-tech company based in Israel.
Today the vast majority of diamond manufacturers – the businesses that cut and polish rough gems – send their loose stones to grading labs.
They wait a couple of weeks for the diamonds to be returned with certificates listing their key attributes. And they typically pay at least $100 per diamond for the service (depending on size).
Sarine aims to dramatically cuts cost and delays by locating its automated eGrading technology inside factories in a lease arrangement.
Staff operate the machine, which can grade and certify a diamond in a matter of minutes.
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It’s as convenient as using an ATM, says Roni Ben-Ari, deputy CEO & VP products at Sarine.
He says the machines consistently deliver higher quality results than the best grading labs, without the expense of employing gemologists (gemstone experts) or paying for premises, infrastructure and other overheads.
Can’t cheat the system
You may be thinking the diamond factory gets to “mark its own homework” if the grading machine is inhouse, and that it could cheat the system to get a better grade.
But Ben-Ari is adamant that the system’s security is so tight it’s simply not possible for anyone to interfere.
Every diamond is unique – like a fingerprint, a snowflake or DNA – and every diamond is identified by full 360-degree images.
The raw data that Sarine’s machines gather is securely uploaded to the cloud, and only then converted into a grading report.
Grading diamonds objectively with Sarine’s eGrading system.
It’s worth considering what’s at stake here.
An absolute top-quality natural one-carat diamond (a popular size for engagement rings) could set you back $14,000. But you could get a poor-quality diamond of the same size for under $2,000. That’s why grading a diamond is so important.
The 4Cs
Four main criteria determine the value of a diamond. They’re known as the 4Cs – carat (weight), cut (how well the rough stone has been shaped), color (the best diamonds are colorless) and clarity (absence of flaws or blemishes).
Diamonds are valued on the basis of carat, cut, color and clarity.
Color and clarity are the hardest criteria to determine. Labs give diamonds a letter for color (from D to Z) and a label indicating one of 11 levels of clarity (from IF, internally flawless, to I3 for diamonds with the worst flaws or “inclusions”).
Weighing a diamond is straightforward, but the other three Cs can be subjective.
“I can guesstimate that if you sent the same 100 diamonds to the lab over and over again, around 70 percent would get the same grade,” says Ben-Ari.
That leaves 30% where a different lab, or a different day, or a different staff member could give the diamond a different grade – and a different value.
Sarine’s system uses AI to grade clarity.
A lot of biases
“The human eye is a muscle; it gets tired,” says Ben-Ari. “It’s affected by your physical conditions, whether you’re tired or angry, or it’s the beginning of the shift or the second half of the shift.
“There are a lot of biases. It’s very difficult to educate people from different cultures in different locations around the world to grade the same diamond in the same way.
“So the labs invented a very sophisticated process where two people grade the diamond. When they agree, that’s the diamond grade and when they don’t, they bring in a third person.”
But it’s a labor-intensive business. Sarine, already an established world leader in guiding diamond cutters to get the highest value from a rough gem, realized it could develop a better way of doing things.
Sarine’s loupe doesn’t get tired like a human eye would.
AI can grade diamonds
The company, founded in 1988 and based in Hod Hasharon, central Israel, embarked on the mammoth task of teaching AI how to grade diamonds.
That involved showing the AI model more than 30,000 diamonds that had already been graded by GIA (Gemological Institute of America) the world’s biggest lab. The more diamonds they showed it, the better the results.
Sarine introduced eGrading machines, using AI to grade diamonds.
Because Sarine deals in technology and not in physical diamonds, all those diamonds to train the computer model had to be borrowed.
That’s why Sarine’s first eGrading machines, installed in mid-2022, were located in factories in India, where over 90% of all diamonds are cut and polished.
“We started in southern India, where we have a facility with 400 employees to provide customer support,” says Ben-Ari.” The next step will be a rollout to Botswana and Namibia, both counties which mine and manufacture diamonds.”
Lab-grown diamonds
We’ve been talking so far about “natural” diamonds, but what about lab-grown diamonds?
Natural diamonds formed miles below the Earth’s surface under high pressure and high temperature in a process that took over more than a billion years.
Lab-grown diamonds are created within weeks, are optically and physically identical to natural diamonds, and now sell for a fraction of the price.
They have driven the need for cheaper grading because in many cases the cost of an ordinary certificate outweighs the cost of manufacturing the diamond.
There are, however, some complex technical differences between natural and lab-grown diamonds, which means Sarine technology can grade them in the lab but not yet remotely with eGrading at factories. Sarine is working on an AI fix for that.
LUCARA RECOVERS EPIC 2,492 CARAT DIAMOND FROM THE KAROWE MINE
Lucara Diamond Corp. (“Lucara” or the “Company”) is thrilled to announce the recovery of an exceptional 2,492 carat diamond from its Karowe Diamond Mine in Botswana. This remarkable find, one of the largest rough diamonds ever unearthed, was detected and recovered by the Company’s Mega Diamond Recovery (“MDR”) X-ray Transmission (“XRT”) technology, installed in 2017 to identify and preserve large, high-value diamonds. The stone was recovered from the processing of EM/PK(S) kimberlite, the dominant ore type that Lucara will continue to target during the first years of the Company’s underground mining operations.
This discovery underscores Karowe’s reputation as a world-class asset and reaffirms Lucara’s position as a leading producer of large, exceptional diamonds. This latest recovery joins an impressive roster of other significant finds from the mine, including the 1,758 carat Sewelô and the 1,109 carat Lesedi La Rona.
William Lamb, President and CEO of Lucara, commented on this historic discovery: “We are ecstatic about the recovery of this extraordinary 2,492 carat diamond. This find not only showcases the remarkable potential of our Karowe Mine, but also upholds our strategic investment in cutting-edge XRT technology. The ability to recover such a massive, high-quality stone intact demonstrates the effectiveness of our approach to diamond recovery and our commitment to maximizing value for our shareholders and stakeholders.”
Mr. Lamb added, “This discovery reinforces Karowe’s position as a truly world-class diamond mine and highlights the continued success of our operational and underground development strategy.”
Botswana’s diamond industry delivers wide-ranging socio-economic benefits to the country that extend well beyond the mining sector. Its influence supports national development by funding critical areas such as education and healthcare.
This discovery symbolizes Botswana’s continued ascent as a global leader in diamond production. It represents not only the unparalleled wealth found in Botswana’s soil, but also the remarkable progress the nation has made in developing its diamond industry for the benefit of its citizens.
This news release has been reviewed and approved by Dr. Lauren Freeman, PhD. Pr. Sci. Nat., Vice-President, Mineral Resources of the Company and a “Qualified Person” for the purposes of National Instrument 43-101.
Namibia is one of Africa’s top five diamond exporters, right behind Angola, Botswana, and South Africa. In 2022, the country exported more than $940 million worth of diamonds.
The world’s demand for natural diamonds has bounced back from a slump during the COVID-19 pandemic, with Namibia’s largest marine dining company, Debmarine, reporting a sales increase of 83% in 2022 from the previous year.
Still, Debmarine CEO Willy Mertens is worried about competition from synthetic diamonds, sector of the business that could cost many Namibians their jobs.
Though trained jewelers can tell the difference between lab-grown and natural diamonds, there’s nothing obvious to distinguish lab-grown diamonds from natural ones.
The Modern Mining publication recently said that in 2022, lab-grown diamond jewelry surpassed 10% of the market of global jewelry sales for the first time. The publication said artificial diamond sales are forecast to continue growing at an annual double-digit percentage rate in coming years.
Namibia, where workers extracted 2.1 million carats in diamonds in 2022, is embarking on a campaign to tout natural diamonds as environmentally sound and holding greater value for the money.
“We’ve seen in the past couple of years that lab-grown diamonds, or synthetics as you call them, have sort of infiltrated the natural diamond market,” said Mertens. ” … people were first marketing them as real diamonds and we’ve done a lot of work around trying to differentiate them.”
One of the challenges of marketing Namibian natural diamonds is the environmental impact that diamonds have on the landscape.
Mertens said Debmarine invests a significant amount of its profits into environmental rehabilitation and restoration of landscapes and the seabed damaged by mining.
“The restoration of the seabed actually happens naturally as the waves move,” Mertens said. “So what we are doing is that we are monitoring that, and what we do is we mine out a specific area and we leave an area next to it vacant, and over time we monitor how the area where we have recovered diamonds looks like compared to the one that was not touched and we’ve seen that it takes about three to 10 years maximum for that to completely restore. By completely restoring, mean about 70% of the organisms have returned to that place. On the land, it is sand that we are moving and what we do now is that we are using that same sand to keep the sea walls in tact.”
Mertens recently paid a courtesy call on Namibian President Nangolo Mbumba, to introduce the De Beers global ambassador for natural diamonds, Hollywood actor Lupita Nyong’o, and talk to the president about challenges facing Namibia’s diamond industry.
De Beers Natural Diamonds Global Ambassador Lupita Nyong’o, left, Namibia President Nangolo Mbumba, center, and Debmarine CEO Willy Mertens in Windhoek, Namibia, July 19, 2024. (Vitalio Angula/VOA) De Beers Natural Diamonds Global Ambassador Lupita Nyong’o, left, Namibia President Nangolo Mbumba, center, and Debmarine CEO Willy Mertens in Windhoek, Namibia, July 19, 2024. (Vitalio Angula/VOA) President Mbumba lamented a proposal for the Kimberley process — the process meant to screen out so-called “conflict diamonds” from entering the international market — to begin certifying all diamonds in Antwerp, Belgium.
The Group of Seven largest economies said that is an effort to prevent Russian diamonds from being sold abroad.
Mbumba said the measure would hurt African diamond producers.
“Recently, the decision was made by the G7 countries to route all rough and polished diamonds destined for G7 countries via Belgium,” said Mbumba. “This decision poses a serious risk and threat to our economies, especially the economies of Angola, Botswana and Namibia by increasing the cost as well as curtailing freedom of trade for our countries’ products.”
Namibia’s president said he and his counterparts from Angola and Botswana have written a letter to the G7 to ask them to halt their plans.
The Index tracking fancy color diamond prices fell during the last quarter, for the first time in almost four years.
The Fancy Color Diamond Index, which monitors pricing data for of all sizes and intensities of fancy color diamonds, fell by 0.7 per cent during Q2 2024, according to an update published yesterday (30 July) by the Fancy Color Research Foundation (FCRF).
The last recorded fall was back in Q3 2020 – in the depths of the Covid crisis – when the Index also fell by 0.7 per cent. That came after two quarters when sales were too slow for the FCRF to produce figures at all.
The trend over the last year or so has been of slower growth. The Index was up 1.3 per cent in Q1 2023, followed by +0.5 per cent (Q2); +0.4 per cent (Q3); +0.1 per cent (Q4) and +0.1 per cent (Q1 2024).
The New York-based FCRF played down the Q2 dip, describing it as “a minor fluctuation when compared to broader market movements”.
It said in a statement: “This stability is particularly evident relative to the sharper declines in the white diamond market and the Dow Jones index, which fell by 3.6 per cent and 1.7 per cent respectively during the same period.
Yellow diamonds (all sizes, all intensities) suffered the biggest drop, down 1.7 per cent. Pinks and blues were both down 0.3 per cent.
The FCRF said its Index had enjoyed an overall increase of 211 per cent since it began compiling data in 2005. During that time it said the price of yellow diamonds had risen by 56 per cent, pinks by 398 per cent and blues by 248 per cent.
Lucapa Diamond Company has sold six diamonds recovered from the Lulo mine, in Angola, in a special tender for $12.4-million.
The diamonds totalled 447 ct and consisted of five white Type IIa diamonds, as well as a pink diamond.
The average price per carat was about $27 700.
MD and CEO Nick Selby deems the tender result pleasing. “Our alluvial project, in Angola, continues to deliver fantastic diamonds that are always in demand through all market cycles and achieve very competitive values.”
India’s exports of polished diamonds suffered another hefty drop in June, down 26 per cent year-on-year to $1.02bn.
Foreign sales in May were down by almost 15 per cent to $1.47bn, according to new figures from the GJEPC (Gem and Jewellery Export Promotion Council).
Polished diamond exports have fallen every month this year, down 20 per cent in January, 28 per cent in February, 27 per cent in March and 17 per cent in April.
Gross imports of rough diamonds for April to June dropped by 15 per cent by value to $3.39bn and 6 per cent by volume.
Overall exports of all gems and jewelry declined by 15 per cent in June to $1.9bn.
Nirmala Sitharaman finance minister of india in a press confrence .
India’s diamond industry welcomed a raft of measures announced in today’s budget (23 July) which will encourage direct diamond sales from foreign mining companies and reduce tax on key raw materials.
Finance Minister Nirmala (pictured) said safe harbor rates would be introduced, providing fixed and favorable tax rates for rough purchases in the country’s SNZs (Special Notified Zones).
Safe harbor streamlines the taxation process and eliminates unexpected liabilities for foreign suppliers.
Sitharaman also announced significant tax reductions on gold and silver to 6 per cent (from 15 per cent and 10 per cent) and on platinum to 6.4 per cent (from 12.5 per cent) and the exemption of diamond sales from a 2 per cent equalization levy aimed at promoting sustainability.
“India is a world leader in the diamond cutting and polishing industry, which employs a large number of skilled workers,” Sitharaman said in her Budget speech.
“To further promote the development of this sector, we would provide for safe harbor rates for foreign mining companies selling raw diamonds in the country.”
“I want to applaud and congratulate the Central Government for their three-point game changing decisions for the gems and jewellery industry,” said Vipul Shah, chairman of GJEPC (Gem and Jewellery Export Promotion Council).
“The reduction of customs duty on gold and silver, exclusion of diamond sector from 2 per cent equalisation level and simplifying taxation rules in Special Notified Zones (SNZ) for rough diamonds will provide a leadership position to the Indian gems and jewellery industry.”
A wealthy US doctor splashed out $275,000 on 5 ct emerald cut diamond for his fiancace.
He plans to have the D colour, flawless gem set in an engagement ring, according to California based Varsha Diamonds, which made the sale through retail partner Phillips Jewelry, in Tennessee.
“We’ll be setting it in the mounting of their choice,” said business owner Robbi Philips. “They are thrilled, and so are we. I feel honored to have found them a remarkable diamond that they will be proud of and will cherish forever.”
Varsha says its Fireworks brand diamonds are cut for beauty rather than size and the symmetrical step cuts achieve maximum white light brilliance.
“Fireworks Diamonds are scientifically proven by AGS’s Angular Spectrum Evaluation Tool (ASET) and Sarine light performance technologies to be the largest and brightest diamonds in the world, and all because of the way they are cut,” said Jay Mehta, director of business operations at Varsha.
