A first (rough) look into 2017 diamond production

World diamond production

After almost a decade of production stagnation around 130 Mct, Kimberley Process 2017 diamond annual production data show a marked production jump for diamonds. Production of rough diamonds rose from 134 Mct and US$12,4 bn (2016) to 151 Mct and US$15,9 bn (2017), an apparent return to pre-2008 levels (not there yet, but getting closer) – data from the Kimberley Process (KP).

South African production explains most of the jump in value recorded in KP data. It more than doubles previous year’s South African production value and it is a record value. Most probably I am missing something: can this be, or is the published data wrong? again, drop me a line to comment on this.

The sharp (12,5%) increase in rough diamond volume production is due to:

  • +  3,1 Mct in Australia;
  • +  2,5 Mct in Botswana;
  • + 10,2 Mct in Canada;
  • –   4,3 Mct in DRC;
  • +  0,8 Mct in Lesotho;
  • +  2,3 Mct in Russia and
  • +  1,4 Mct in South Africa.

The even sharper (28%!) value increase was due to:

  • +   483 M USD in Botswana;
  • +   663 M USD in Canada;
  • –     89 M USD in DRC;
  • +   533 M USD in Russia and
  • + 1 840 M USD in South Africa.

World diamond value

 

2017 diamond flows and what lies ahead

IDEX just reported on the 2017 Diamond Pipeline in the latest number of their online magazine. The 2017 update of IDEX’s conceptual map is an insert of a wider analysis of the current state of the diamond industry. It’s always worthwhile to read informed analysis; don’t miss it at http://www.idexonline.com/Magazine.html.

IDEX’s Magazine view is somber, considering 2017 as the calm before the storm. “The industry is heading into a period where the next few years will see some of the fundamental operating principles of the industry undergo changes“. The main industry drivers, in their opinion are the

  • industry financing,
  • tightening diamond supplies (apparently good news for me, as my company is active in the exploration and evaluation of diamond deposits especially in Angola),
  • lab-grown diamonds (synthetics) – our favorite villain since I remember,
  • compliance and the
  • data tsunami (with the potential to reshape the industry) – see our post of a few weeks ago on gold, gold, gold, crypto coins, blockchain and diamonds.

I am an optimist: changes are just a fact of life. There will be those that won’t adapt, others will. To be one of the laters, keep checking your markets’ pulse, keep changing.

One decade of ups and downs in rough and cut diamonds

Quarterly Zimnisky Rough Index.png

Indices.png

The last two decades have been a carrousel of emotions in the mining industry:

  • Oil and gold prices had steadily been growing since 2001. Oil spiked to maximum historical values in 2008 (and then crashed, to climb again for 3 consecutive years, plateau for 4 years, until mid 2014, crashing again, reaching nominal values of 2005, and recovering marginally since then).
  • Gold has had a more regular pattern, growing since to 2001 until 2011, maintaining a high plateau until the end of 2012, crashing until mid 2013, becoming relatively stable since then.
  • Polished diamonds have shown a much less volatile behaviour, with some ups in 2008 and 2011 (mimicking the markets’ general mood) but rapidly stabilising into a nominal stability (a slow real price decline).
  • Rough diamonds prices rose roughly 50% in nominal terms (as measured by the Zimnisky Rough Index) since 2007, a more subdued increase in real terms. The price increased in the 2009 – 2011 period, after which it stabilised until early 2015, after which it slowly declined until today.

Why are diamond prices less volatile than other mineral commodities’?
Why do rough and polished prices behave differently?
New deposits discovery and production capacity expansion seem increasingly difficult; why don’t diamond prices increase significantly in real terms?
Are there two different markets in diamonds?
What is the impact of new recovery technologies (XRT) in diamond markets?

Will discuss that in the next post. What is your opinion?

The oil and gold indices were calculated by just dividing the monthly gold average nominal price in US dollars by their price (nominal US dollars) in January 1980.

The Antwerp Diamond Index is a set of indices used to measure the price variation of five types of polished diamonds. The index is based on prices in US $ and gives the average price evolution on the Antwerp market of diamonds ranging in colour from exceptional white + to white and in clarity from LC to VS2:

  • 1 ct diamonds (1973 =100)
  • 1/2 ct diamonds (1973 =100)
  • A = Small Brilliant (1980 =100)
  • B = Melée (1980 =100)
  • C = 1/4 ct diamonds (1980 =100)

The Antwerp Diamond Index is maintained by the Diamond Office of The Antwerp World Diamond Centre (AWDC). To know more about AWDC and the Diamond Office , just visit their website: https://www.awdc.be/en/diamond-office.

The Zimnisky Global Rough Diamond Price Index was created to consolidate rough diamond price information and publish current respective price changes of rough diamonds on a weekly basis in the form of an index.  The intent of the Index is to track, analyze, and disseminate current aggregate rough diamond price fluctuations for use by a range of diamond industry participants.

The proprietary index methodology primarily incorporates price data from rough diamond transactions in the primary market, e.g. sales via long-term contract, tender, and auction by commercial miners. The Index also includes a minor sensitivity to polished diamond prices, given that miners utilize the polished market as a factor when determining contract pricing of rough. In addition, the Index includes a minor sensitivity to stand-alone diamond mining equities, as the relative liquidity that equities provide can imply the current profitability and revenue generation ability of diamond miners, which is directly influenced by the current rough diamond market.

Given the nature of natural diamond production, the variance in quality of stones produced, or the product mix, can impact global rough diamond prices on an average price-per-carat basis. The Index strives to represent as accurately as possible current price changes reflected in the average rough diamond transaction valued on a per carat basis in U.S. dollars. The Index value does not directly represent the price of a 1-carat rough diamond, but the percentage change in the average value of a rough diamond transaction relative to the initial Index value, at a given point in time.

The Index is based on an initial value of 100 using data starting on April 4, 2004. The Index is updated on a weekly basis, typically on Saturday. Retroactive revisions to index data are made on a quarterly basis typically after public miners release official quarterly sales figures.
(adapted from http://www.paulzimnisky.com)

To know more about the Zimnisky Global Rough Diamond Price Index, or obtain Paul Zimnisky’s insight on the diamond markets, check http://www.paulzimnisky.com.

WIN A DIAMOND: HRD ANTWERP JULY SUMMER CONTEST

WHAT DOES A DIAMOND SYMBOLISE FOR YOU ?

From Monday July 3 to Sunday July 9 12.00pm, HRD organizes a Summer Contest on their Social Media platforms to discover what a diamond symbolizes for our online community.

To participate, post an original photo or video about what a diamond symbolizes for you on your public Instagram account, and make us dream away with you!

The participant with the most original photo/video will win a 0,30 ct diamond graded by HRD Antwerp. The winner will be announced on HRD’s Instagram account on Thursday July 13.

How to participate?
Follow these 3 easy steps:

1. Follow HRD’s Instagram account and like their  Facebook page

2. Post a photo/video on Instagram about what a diamond symbolizes for you, with the hashtag #hrdantwerplovesdiamonds​

3. Make sure your Instagram profile is public until Thursday July 13

Good luck to all of you !

 

Camissombo – Moquita – Lucapa – Saurimo – Malanje – Luanda: ida e volta

Angola 20170313 115220
A caminho do trabalho – garimpo na Lunda Norte

Um projecto de prospecção e exploração de diamantes de aluvião levou-me, de novo, a Angola.

Estreámos uma nova tecnologia (um drone acabado de comprar; como vivemos até agora sem um?), revimos velhos amigos e fizemos novos conhecimentos, falámos com garimpeiros e ouvimos a chamada muçulmana para as orações às 4 da manhã no Lucapa, experimentámos uma (para nós) inédita viagem por estrada Camissombo – Moquita – Lucapa – Saurimo – Malanje – Luanda, atravessámos e viajámos no rio Luachimo.

Viajo (e trabalho) há vinte cinco anos para Angola; nenhuma viagem foi tão intensa. Os filmes e as fotos que irei publicando ao longo das próximas semanas são para mim forma de não esquecer; para quem já lá viveu, pretexto para recordar.

A Sínese é uma empresa especializada em Geologia Económica e Análise e Sistemas Inteligentes. Fundada em 1995, a Sínese realizou estudos técnicos, económicos e de mercado, desenvolveu sistemas de informação especializados, concebeu e implementou projetos de prospecção, avaliação, mineração de recursos minerais em diversos países e continentes – Europa (Portugal), África (Angola, República do Congo, África do Sul, Angola) e nas Américas (Canadá, Estados Unidos, Brasil, Argentina, Uruguai e Equador).
Em particular, a Sínese esteve envolvida em inúmeros projetos ligados à prospecção e mineração de diamantes jazigos aluvionares e quimberlíticos em Angola e no Brasil, de pedra natural em Portugal, no Brasil e em Angola e de ouro e/ou nióbio e tântalo (nomeadamente aluvionares) em Portugal e na República do Congo, manganês e outros metais no Brasil.
A Sínese, coordenada por Luís Chambel – luischambel@sinese.pt , é constituída por uma equipa coesa, flexível e altamente qualificada, com especialistas em diversas disciplinas técnicas e científicas, desde a Engenharia de Minas, Geológica Económica e Aplicada, Sistemas de Informação Geológica, Estatística e Análise de Dados.

US $8.3 million, 1 863 ct diamond record sale by LUCAPA DIAMOND COMPANY

The latest sale of Lulo project (Angola) production by Lucapa Diamond Company (ASX:LOM) reached a new record: 1 863 ct were sold for US $8.3 million (at a US$ 4 452 per carat average price) – ASX Announcement of 07 November.

That announcement follows an earlier dated 27 October describing the continued recovery of large diamonds in the company’s alluvial mining operation in the Lulo Project (Angola), including five white type II-A – 172, 104, 77, 72 and 71 ct – and one 39 ct fancy pink (the largest to date at Lulo).

You may obtain the full ASX announcements on LUCAPA DIAMOND COMPANY (ASX:LOM) here: http://www.lucapa.com.au/announcements.

screen-shot-2016-11-07-at-10-23-11

 

CIBJO Diamond Commission Special Report (synthetics and inclusion mapping technologies)

CIBJO released a Diamond Commission Special Report (SEPTEMBER 7, 2016). The report (cibjo-special-report-2016-diamond-commission) discusses two important developments:

  1. Synthetic diamonds. The report reiterates standards introduced by CIBJO to clearly distinguish between natural and man-made gems. These essentially were adopted (in general) by the International Standards Organisation in 2015, when it released ISO International Standard 18323 (specifies a set of permitted descriptors for the diamond industry that are designed to be understood by the consumer).
  2. Scanning technologies, created in recent years, enable rough dealers to accurately map the internal inclusions in a stone. The report discuss the ethical implications of such technologies.

CIBJO, the World Jewellery Confederation, describes itself as the “United Nations of the jewellery business,”. It represents the interests of all individuals, organisations and companies earning their livelihoods from jewellery, gemstones and precious metals. It is the oldest international organization in jewellery sector, having originally been established in 1926.

With its membership made up largely by national jewellery trade organizations from more than 40 countries around the world, CIBJO covers the entire jewellery, gemstone and precious metals sectors vertically, from mine to marketplace, and horizontally within each of the component sectors in the various production, manufacturing and trading centres. Most of the international jewellery sector’s leading corporations and service providers are also affiliated to CIBJO through commercial membership.

Curso: Introdução à Gemologia

Curso Maria José Trindade

A Maria José Trindade, que organiza e lecciona o curso, é uma gemóloga com uma rara base científica, garantia da qualidade dos cursos que lecciona. Para se inscrever no curso de Introdução à Gemologia do próximo dia 9 de Julho (em Lisboa) basta aceder ao site da WeValue: Formação Avançada.

Maria José Trindade graduated in Geology (Faculty of Sciences of the University of Lisbon), also has a Master degree in Dynamic Geology (Faculty of Sciences of the University of Lisbon) and a PhD degree in Geosciences (University of Aveiro). She also has a specialization in Gemology and Diamond Grading (Portuguese Gemological Institute).

She has scientific experience in different areas, such as geochemistry, mineralogy, igneous petrology, volcanology, sedimentary basin analysis, clay deposits, external geodynamics, archaeometry, weathering of stone built heritage and compositional characterization of historic tiles. More recently, she obtained experience in the study of gemstone’s properties used for their identification and separation from fakes (synthetic and artificial substances).

Her professional activities, as a FCT post-doctoral researcher, have been developed in the Center for Nuclear Sciences and Technologies (Nuclear and Technological Campus of Technical Superior Institute) and she also collaborates with Geobiotec research center (University of Aveiro). Her work has been dedicated to the application of nuclear methods and mineralogical analysis to characterize geologic and ceramic samples in studies regarding distribution of trace elements and natural radionuclides (U, Th and K) in superficial environments, as well as in provenance studies of archaeological shards and cultural heritage studies.

She is author of several scientific papers in national and international journals and proceedings of scientific meetings, in addition to dozens of oral and poster presentations in international and national conferences, in a few as invited lecturer. She was awarded as “best poster” and “young investigator” in two European scientific meetings. She is also a reviewer of scientific papers and was a member of the scientific committee of a congress and a symposium held in Lisbon.  

Duas novas autorizações de exploração semi-industrial para cooperativas na Lunda Sul

De acordo com notícia publicada no Novo Jornal, o Ministério de Geologia e Minas deu autorização a duas cooperativas para a exploração semi-industrial de diamantes na Lunda Sul.

As autorizações foram dadas às cooperativas Linga Tchimwe (numa área de 54 km2) e Kulha (9 km2). Os direitos são atribuídos por um ano, podendo ser prorrogados por quatro.

Angola é um dos principais produtores mundiais de diamantes, tendo extraído  em 2015 mais de nove milhões de quilates (menos de duas toneladas), com um valor de quase 1.200 milhões de dólares ( a um preço médio em torno de 130 USD/ct).