De Beers – Page 25 – The Diamond Certification Laboratory of Australia (DCLA)

De Beers Closes Diamond-Reselling Unit

De Beers is shutting its diamond-recycling division, as digital advancements in the sector have lessened the need for its services.

The International Institute of Diamond Valuation (IIDV) was set up in 2016 to repurchase and recycle diamond jewelry that consumers no longer wanted. De Beers began the operation after noting the difficulty consumers faced in trying to sell their jewelry at a fair price. The venture provided a means of emphasizing the enduring value of diamonds, De Beers said.

However, since IIDV launched, technology in the industry has improved, and online consumer-to-consumer selling platforms have become a more popular option, the company explained.

“Following a number of years gaining experience in the diamond-recycling sector, we have taken the decision to suspend the activities of the International Institute of Diamond Valuation,” David Johnson, De Beers’ senior manager for media and commercial communications, told Rapaport News Thursday.

While the project is no longer a viable option, it has provided De Beers with valuable insight into consumer behavior and the needs of its retail partners, Johnson explained.

“We know that consumer acceptance of the consumer-to-consumer market is growing and likely to be the future of this sector, and we will therefore continue to look for opportunities in this space,” he added.

Image: Diamond solitaire earrings. (De Beers)

Source: Diamonds.net

Last kimberlite trucked to plant at De Beers Victor mine

The last truckload of kimberlite from Ontario’s first and only diamond mine has left the pit. De Beers Canada said mining ceased on March 5 – 11 years to the day after the official opening in 2008.

The honour of driving the last truck went to Nancy Wesley, of Kashechewan First Nation. She worked at Victor for 11 years, as a haul truck driver, dozer operator and production drill operator.

Stockpiled kimberlite will keep the recovery plant running until early May.

The Victor mine was forecast to produce 6 million carats of diamonds over its life, but it beat that by recovering a total of 8 million carats – with a record 936,000 carats produced in 2018.

The project provided about 1,360 jobs and $3.7 billion of revenue to the province.

De Beers, Botswana to expand world’s richest diamond mine

Botswana’s Debswana Diamond Mining, a joint venture between De Beers and the southern Africa country’s government, have awarded Thiess’ subsidiary CIMIC a $1.2-billion contract to extend the lifespan of their Jwaneng mine.

Jwaneng, which began operations in 1982, is currently 650 metres deep, but its owners want to deepen the pit to 830 meters (2,700 feet), which will allow continuing operations for another 11 years, to 2035, and extracting a further 53 million carats.

Debswana will invest approximately $2 billion over the life of the project, dubbed Cut 9, which involves removing waste from the bottom of the mine to both widen and deepen the pit.
“Jwaneng, which began operations in 1982, will continue in operations unit 2035.”

At its peak, Cut-9 is expected to create more than 1,000 jobs, the majority of which will be held by locals.

“With global consumer demand for diamonds reaching record levels in 2018, the extension will enable us to continue to meet the needs of our consumers all over the world,” Debswana’s chairman Bruce Cleaver said in the statement.

This is not the first time Debswana decides to invest in expanding Jwaneng, the world’s No.1 diamond producing mine by value, which contributes almost 70% of the partnership’s total revenue.

The company completed in November a $3-billion, 10-year-long expansion plan, Cut 8, which extended the lifespan of the mine to 2024.

Debswana was formed in 1969 as a 50/50 partnership between the Botswana’s government and De Beers Group. The unit is a significant contributor to the country’s economy with more than 80% of its profits going back to Botswana’s citizens.

Diamonds from Debswana bring in about 50% of public revenue, representing 33% of GDP and over 80% of foreign earnings to Botswana.

Source: mining.com

2H Slump Dents De Beers Sales Volume

De Beers’ sales volume fell 4% last year due to weakened demand for lower value diamonds in the second half.

The miner sold 33.7 million carats of rough, compared with 35.1 million carats in 2017, as clients bought fewer of its cheaper stones, it reported Thursday.

De Beers’ average price for sales excluding some sales by its joint-venture partners rose 6% to $171 per carat for the year, reflecting the larger proportion of higher-value goods. As a result, rough-sales value increased 2% to $5.39 billion for 2018, according to Rapaport estimates based on De Beers’ sight reports. The company’s average price index, which tracks its rough prices on a like-for-like basis, declined 1% in the second half, but ended 2018 up 1% versus the previous year.

Production grew 6% to 35.3 million carats, exceeding sales volume.

Sales jumped 21% to 9.9 million carats in the fourth quarter, with revenues also increasing, as the company allowed sightholders to defer purchases from the September sight to later months. Production grew 12% to 9.1 million carats for the quarter.

Source: Diamonds.net

De Beers Sales Slip to $440M

De Beers recorded its lowest-value sales cycle this year as weak Indian demand prompted it to drop prices of cheaper goods.

Proceeds fell to $440 million in November as the miner reduced prices by high-single-digit percentages for rough diamonds costing $100 per carat or less, sightholders said last week. The Indian manufacturing sector has struggled with thinning profit margins due to relatively high rough prices and the weak rupee, while tighter bank lending has further contributed to a decline in demand. November is also seasonally slow as factories close for the Diwali festival.

Proceeds from the ninth sales cycle fell 6% compared with the equivalent period a year ago, and were down 9% versus the $482 million it garnered in October, De Beers reported Tuesday.

“As the industry’s focus turns towards the key end-of-year retail selling season, rough-diamond sales continued to be in line with expectation during the ninth cycle of the year,” said De Beers CEO Bruce Cleaver. “While demand for smaller, lower-quality rough diamonds continues to see some challenges, the latest cycle saw some signs of improvement in this area as factories in India begin to reopen after Diwali.”

Rough-diamond sales came to $4.85 billion for the first nine cycles of the year, in line with a year ago, according to Rapaport calculations. The company offers its rough goods at 10 sales cycles across the year, mainly at sights in Gaborone, Botswana. Its sales figures also include auction proceeds.

Image: A De Beers sightholder examines a parcel of rough diamonds. (Kieran Doherty/De Beers)

Source: Diamonds.net

De Beers Cuts Prices of Cheaper Rough

De Beers significantly reduced prices of lower-quality rough diamonds at this week’s sight in response to a slowdown in the Indian manufacturing sector, dealers reported.

Prices fell by high-single-digit percentages versus the previous sale, sightholders told Rapaport News Tuesday. The drops were for rough costing $100 per carat or less, including both small and large stones that produce polished with low color and clarity.

Those segments of the Indian manufacturing market have suffered most from the depreciation of the rupee and tighter bank lending to the trade in recent months. De Beers’ move also reflects the seasonal weakness due to the Diwali festival, when many companies close their factories for two weeks or longer.

“There were a few corrections to align prices with the markets,” a broker said. “It was nothing earth-shattering — what [De Beers] did was sensible given the time of year.” The miner scheduled the drop to ensure manufacturers returned from Diwali to a market with lower rough prices and therefore stronger profit margins, the broker added.

De Beers mostly maintained prices for higher-value rough as demand has been strong for polished that comes from those categories, a sightholder said. Even so, manufacturing profits are tight, he noted.

“Generally things are good, but it’s challenging to make a profit,” the sightholder added. “Because of rough prices this year, it’s been tough to make good money. It’s not about losing money, but there’s less money to be made.”

De Beers is scheduled to release the value of its ninth sales cycle next week. The miner declined to comment Tuesday.

Image: Inspection of De Beers rough diamonds. (De Beers)

Source: diamonds.net

De Beers’ recent diamonds sale the worst in two years

Anglo American’s De Beers, the world’s No.1 diamond miner by value, has just had the lowest sales for its seventh cycle since it began releasing data in 2016, as it let customers delay acquiring smaller stones for the first time.

Sales for the cycle stood at a provisional $505 million, down 5.5% from the $533 million obtained in the previous cycle of the year and 0.4% from $507 million for same period in 2017.

“De Beers Group provided Sightholders with the opportunity to re-phase the allocation of some smaller, lower value rough diamonds.” chief executive officer, Bruce Cleaver, acknowledged in the statement.

The unusual move (De Beers is known for requiring buyers to take what’s offered) says lots about the state of the low-end diamond market. The last time the company did something similar, in fact, was two years ago, when India’s move to ban high-value currency notes pushed down demand.

Sales were down $134 million or 21% compared to the same cycle in 2016, when De Beers began releasing this kind of data.The diamond giant has about 80 handpicked clients called sightholders who are allocated parcels of diamonds sorted and aggregated in Gaborone. The 10 annual sales events are known as sights.

De Beers’ new strategy for small stones, paired with its looming entry into the lab-grown stones market, have many in the industry worrying about prices.

Cheaper diamonds, which are often small and low quality, are selling for a lot less now than five years ago. And when it comes to synthetic stones, De Beers’ entry in the market will create a big price gap between mined and lab diamonds, pressuring rivals that specialize in synthesized stones at the same time.

A 1-carat man-made diamond sells for about $4,000 and a similar natural diamond fetches roughly $8,000. De Beers new lab diamonds will sell for about $800 a carat. That’s a fifth of the price of existing man-made stones and one-tenth of the cost of buying a similar natural gem.

No wonder competitors are worried. The lab-grown industry has filed a complaint with the U.S. Federal Trade Commission, accusing De Beers of price dumping and predatory pricing.

Low sales, stable demand

In 2016, De Beers recorded sales of $639 million for the seventh of its tenth annual sales events. That is $134 million or 21% more than what it just made after letting buyers reject small, low-quality stones. That means that, to date, 2018 is shaping to be the worst in terms of sales for the Beers in the past two years, with combined sales of $3.93 billion against the previous year’s $4 billion and 2016’s sales of $4.12 billion.

The dip is sales comes despite demand has remained stable ahead of the Hong Kong Jewellery & Gem Fair, at least according to what Cleaver said. The exhibit, which takes place from Friday this week to Tuesday next week, last year reportedly attracted 3,695 exhibitors and 59,122 buyers.

Source: mining.com

De Beers, Botswana Prep for New Sales Deal

Botswana once again finds itself at a crossroads. The sparsely populated, landlocked country is in a constant battle to ensure the longevity of its diamond industry.

Recognizing that diamond mining will not last forever, the government’s beneficiation program has sought to establish cutting and polishing, trading, and auxiliary services in an effort to diversify its industry — and economy — away from its reliance on the mining sector.

Beyond mining

De Beers, which counts around 59% of its production by value in Botswana, has played no small part in that effort. It did so initially by earmarking a part of its rough supply to be manufactured in Botswana, and today there are 18 sightholders with factories in the country. In 2013, De Beers moved its sales headquarters to Gaborone, meaning that its 10 annual sights were taken out of London, thus diverting traffic and diamond-related activity to the African city.

Furthermore, the establishment of the parastatal Okavango Diamond Company that same year gave the government access to 15% of production by Debswana, its joint mining venture with De Beers. That was the first time substantial rough sales from Debswana took place outside of the De Beers system.

The 2011 agreement that governed those developments is up for renewal in 2020, and negotiations are expected to begin in the coming year. For its part, the government is seeking to increase supply to local sightholders as a means of creating more jobs, newly elected President Mokgweetsi Masisi told Bloomberg in May.

Some question whether Botswana can handle more manufacturing, given that a few factories have closed in recent years. If profitability remains the biggest challenge facing manufacturers, Gaborone has yet to prove itself as a viable center for high-volume cutting. Perhaps De Beers can play a further role there, too.

The government will also likely want to increase the percentage of Debswana supply that Okavango receives. And it might want to renegotiate greater access to the large and high-value diamonds Debswana recovers.

Digging deep

Botswana has some leverage in the relationship with De Beers. It owns a 15% stake in the group, with Anglo American holding the remaining 85%. And the two are equal partners in Debswana and in DTC Botswana, which sorts and mixes production for De Beers and Okavango.

De Beers, meanwhile, brings to the table its mining expertise and budget. In 2010, it committed to investing $3 billion over 15 years in the Cut-8 expansion of the Jwaneng mine — considered the world’s most valuable diamond-producing asset.

That project is already the main source of ore at Jwaneng and is expected to extend the life of mine to 2030 and by some 93 million carats. Studies for the viability of Cut-9 are under way, which would further extend the life of Jwaneng. A final investment decision on the project is expected later this year, reports a De Beers spokesperson.

De Beers could use the potential Cut-9 investment, as well as funding extensions at the Orapa and Letlhakane mines, as a bargaining tool in negotiations with the government.

African investments

De Beers walks a similarly fine line in other African countries where it operates.

In South Africa, it may have to reduce ownership of its local businesses from 74% to 70% under the new mining charter, as the government wants to see more local black economic empowerment (BEE) involvement. That said, De Beers is engaged in a $2 billion project to develop underground mining at the Venetia asset. From next year, Venetia will be its only mine in South Africa, as it plans to close the Voorspoed mine. It has already sold the Finsch, Cullinan and Kimberley operations over the past decade.

Meanwhile, in May 2016, De Beers signed a 10-year sales agreement with Namibia, in which it ceded 15% of local supply to the government and promised more diamonds to local cutters. The company subsequently announced major investments in its marine mining operations off the Namibian coast.

It’s that give-and-take that Masisi is hoping will result in a “win-win” for both parties as they negotiate their next long-term deal — especially given that so much of Botswana’s future diamond production depends on Jwaneng’s expansion.

“We have had a wonderful relationship with De Beers, and we expect that relationship to be even more cemented,” the president told Bloomberg in May. “The returns [from the Jwaneng development] are going to be realized in the period of the next deal. This is a marriage we’re after.”

This article was first published in the July issue of Rapaport Magazine.

De Beers rough diamond sight grows to $575m

Anglo American’s De Beers the world’s largest rough diamond producer by value, sold $575 million worth of rough diamonds at the fifth sight of this year.

The value is a 6% increase from the $541m sight in the same period last year and 3.7% higher than the $554m sight last month.

De Beers has increased efforts in recent months to find a way to verify the source of diamonds and ensure they are not from conflict area where rough diamonds may have been used to finance violence.

Last month De beers announced it would start selling jewellery made with laboratory grown diamonds.

The De Beers Retail division removes diamond from the name

De Beers public brand identity, has been renamed ”De Beers Jewellers” to reflect the companys retail chain.

De Beers acquired fully the formerly known De Beers Diamond Jewellers in 2017. Which was a partnership with LVMH Moët Hennessy Louis Vuitton.

The London headquartered retailer announced Stephen Lussier, as De Beers executive vice president for marketing in charge of the operation.