G7 Sanctions Will Harm Botswana’s Diamond Development, Officials Say

The Group of Seven (G7) import restrictions targeting Russian diamonds will have a detrimental impact on Botswana’s diamond trade and may reverse the gains the country has made in recent years, government officials told Rapaport News.

The proposal to create a single-node location through which all diamonds should pass to verify G7 compliance would be a logistical nightmare for producer countries, Lefoko Moagi, Botswana’s minister of mineral resources, green technology, and energy security, said in an interview.

“It creates added time in terms of processing our diamonds and it affects our beneficiation trajectory,” Moagi explained. “This may bring about added costs and unintended consequences that will affect the producer countries.”

In December, the G7 — which comprises Canada, France, Germany, Italy, Japan, the UK, and the US, as well as the European Union — announced new restrictions to prevent the flow of Russian diamonds to their markets. The measures include a ban on direct imports of diamonds from Russia, taking effect at the beginning of the year. From March 1, the sanctions were extended to Russian-origin diamonds polished in a third country, which prompted each G7 nation to issue interim guidelines requiring self-certification by members of the trade declaring their goods did not originate in Russia.

A blockchain-enabled traceability system will be implemented in the final stage on September 1, which the European Commission stipulated will require verification of the diamonds in Antwerp.

Systems in place
Botswana is concerned such a system will result in delays and additional costs, and consequently slow down the development of its own trade.

The government is petitioning the G7 to allow such verification to take place in the producer countries, particularly in Botswana, since it can easily adjust its processes to meet the G7 requirements, noted Emma Peloetletse, permanent secretary to the president, in a separate interview.

“Why not build on what already exists, because we have it?” she contended.

The government hosted the G7 working committee in January to demonstrate its systems and to convince the group that a local registration point can be trusted without fear of contamination by Russian goods.

“The G7 working group was shocked to see our robust systems,” Peloetletse said. “These took years of work and investment to develop.”

She expressed frustration at the lack of engagement by the G7 following the visit and that the working group didn’t have the answers to Botswana’s questions.

Risk to the economy
As a nonaligned nation, Botswana is not opposed to the sanctions, Peloetletse stressed. The country is primarily concerned about the effect their implementation will have on its diamond industry, and subsequently on the economy, she added.

Diamond mining accounts for an estimated 20% of gross domestic product (GDP), while diamond cutting, polishing, and trading makes up about 5%, according to local economist Keith Jefferis, managing director at econsult Botswana.

The domestic economy was estimated to grow 3.2% in 2023, Finance Minister Peggy Serame said in her budget speech on February 5. That represents a slowdown from 5.5% growth in 2022, reflecting “the relatively weak performance of diamond trading and mining activities throughout 2023,” she explained.

Serame projected the economy would grow 4.2% in 2024, but noted several risks that could reverse such gains. Among them are those from within the diamond industry, particularly in the beneficiation subsector, “which would be worsened by the G7 plan to verify the origin of non-Russian goods through diamond certification in Antwerp,” the minister said.

After the De Beers high
The government continues to rely on diamonds to elevate the standard of living in the country and expects its new sales agreement with De Beers, announced last June, will be a catalyst for continued economic growth.

“Diamonds are something we guard with our lives, given what it has done for Botswana and what it can still do for the country,” Moagi said. “That resonated throughout our negotiations with De Beers. There was a meeting of minds with them to reach an agreement that can really boost the economy.”

The agreement will see state-owned Okavango Diamond Company (ODC) increase its share of local production from 25% to 50% over the next decade. That will enable ODC to introduce contract sales and subsequently designate rough for beneficiation — something it has been unable to do with its current auction-only sales channels.

The government wants more diamonds to be manufactured in Botswana and views that program as a path to encourage local entrepreneurship in the diamond trade, Moagi explained. ODC is planning to include an allocation for citizens to incubate local diamond manufacturers looking to develop in the beneficiation sector, he continued.

The deal also marked the establishment of the Diamonds for Development Fund (DDF) as a way to enable entrepreneurship both within and outside the diamond industry, the minister explained.

While the De Beers agreement left the government on a high, the G7 plans burst its bubble, Peloetletse added. “Now, when we are supposed to reap what we have sowed, we get this,” she said. “It has left us very anxious about our prospects.”

African lobby
The concern is shared by other producer countries. Botswana President Mokgweetsi Masisi met with his counterparts in Angola and Namibia in late February and sent a joint letter to the G7 leaders outlining their concerns. Their sentiment was echoed by the African Diamond Producers Association (ADPA), which emphasized the negative economic consequences the G7 measures would have on the entire diamond supply chain.

“In the absence of proper consultation with African producers, it is concluded that the G7 restrictions on diamonds will disrupt the current supply chains and the fundamental business model of the diamond sector by introducing segregation requirements,” the ADPA said in its February 29 statement.

Minister Moagi is hoping for stronger engagement with the G7 decision-makers, rather than just the working committee. There is a sense that not all G7 members agree with the proposed approach to implementation, and that the African producers can leverage their position to negotiate a more practical approach, he said.

Brace for the worst
Ultimately, the African producers, and Botswana in particular, want a stronger say in how their production is handled and leveraged.

While giving license to others to tell the Botswana story, there has been a realization that those outsiders have their own agenda, Peloetletse said. “There is nobody who can tell our story better than us,” she stressed, while referencing the country’s path toward independence as a former British protectorate.

In a similar tone, Moagi stressed that from Botswana’s perspective this is more than an economic issue: “It is an assault on our democracy and the sovereignty of countries,” he cautioned. Peloetletse added that the G7 sanctions constitute just one example in which Botswana is still trying to exert its independence.

Other battles include the reclamation of land from foreign entities, after the government in November set aside BWP 1.4 billion ($102.6 million) for the acquisition of 45,000 hectares in the country’s Northeast District from British-registered Tati Company. While Tati’s status as the largest private landowner in Botswana stems from a 1911 allocation, the recent deal sparked a debate about why the country should pay such a hefty price for its own land.

The government is also engaged in a battle over its wildlife policy as European legislators attempt to ban the import of animal-trophy hunting products from the country. With the largest herd of elephants in the world, and an oversupply of game, the country must manage its ecosystem and incentivize communities to coexist with the animal population, Peloetletse explained. The government has granted the rural communities quotas for trophy hunting, arguing that banning the practice would greatly affect the livelihoods of their residents.

The convergence of these issues, and most notably the potential impact of the G7 sanctions on its diamonds, has left the government feeling uneasy and uncertain how to move forward, said Peloetletse, whose role is to advise President Masisi.

“We have to brace for the worst-case scenario because it’s not clear the G7 is willing to listen or know what it means to our economy,” she said. “Once you close the diamond tap, and the tourism tap, then we’re done, and that’s not what Botswana wants. We aspire to be a high-income country. We want to liberate ourselves.”

Source: DCLA

Botswana Assigns $65M for Stake in Belgian Manufacturer

Botswana has designated BWP 890 million ($65 million) from its new fiscal 2024-2025 budget for the purchase of a 24% stake in Belgian manufacturer HB Antwerp.

The deal, which it first announced in March, calls for the African country to supply rough from state-owned Okavango Diamond Company (ODC) to HB Botswana for five years. The partnership would operate in a similar fashion to HB’s previous supply deal with Lucara Diamond Corp, enabling Botswana to retain a share of the polished profits.

Lucara terminated its rough-supply agreement with HB in September, citing a “material breach of financial commitments” by the Belgian manufacturer as the reason for the split. That decision came on the heels of HB’s departure from cofounder and managing partner Oded Mansori, whom it has since reinstated to his original role.

There was media speculation late last year that the Botswana government was pressuring Lucara to reconnect with HB, and that the split could affect Botswana’s interest in the manufacturer. Lucara owns the Karowe mine in Botswana. The miner has since announced that it planned to form new supply deals with other vendors.

Source: DCLA

Good news for Botswana Diamonds

Botswana Diamonds has announced that a gravity survey has been completed over four high-grade geophysical targets that had good magnetic response in a previous survey undertaken by the company.

“Preliminary results from this gravity survey show that at least one of the four targets, which is located 6 km south of the existing KX36 diamond discovery, has an excellent gravity response like that of known kimberlites and similar in size to KX36. The survey on the KX36 size anomaly is being repeated and correlated with previous results for confirmation. Next steps will be a drilling plan.

The new kimberlites targets have great potential to upgrade the existing resources in the area, including at the Ghaghoo Mine, which is currently under care and maintenance and only 60 km away from the KX36 project.

The KX36 project is a 3.5 ha kimberlite pipe in the Kalahari. The pipe has resources of 17.9 Mt at 35 cpht and 6.7 Mt at 36 cpht at $65 /ct. The modelled grade range is 57-76 cpht at an estimated diamond value of up to $107/ct.

Botswana Diamonds Chairman, John Teeling, commented: “This is the first strong indication of additional kimberlites around the KX36 discovery. Kimberlites come in clusters, but extensive exploration has to date not been successful.

“The anomaly has a strong gravity signature which gives us confidence that when drilled, it will prove to be a kimberlite. The anomaly sits on a structure like all the other kimberlites in the Kalahari, which further increases confidence. It is early days but very good news”.

Source: DCLA

Diamond certification head questions G7 plans to ban Russian producers

Ahmed bin Sulayem, who this week was elected to take charge of the Kimberley Process, a multilateral body tasked with cleaning up the diamond trade, said any proposed scheme “must take into account African diamond producing nations” such as Botswana, the Democratic Republic of Congo and South Africa.

But the Emirati warned that a Belgian proposal to put restrictions on the international trade of diamonds, which the G7 is considering adopting, “falls well short of this important goal”.

The EU’s chief diplomat Josep Borrell last week said the bloc was set to move ahead with a ban on Russian diamonds after securing sufficient backing from the G7 group of developed nations.

The diamond dispute is only the latest rift between Europe and African capitals. A ministerial meeting set for next week has been postponed after officials decided there was little chance that the two sides would agree on a joint communiqué containing language regarding Israel’s war against Hamas and Russia’s war in Ukraine, according to three people briefed on the discussions.

Surce: DCLA

Botswana’s ODC halts diamond sales as industry seeks to reduce glut

Botswana’s state-owned Okavango Diamond Company (ODC) has temporarily halted its rough stone sales as part of an industry-wide drive to reduce the glut of inventory caused by lower global demand for jewelry, its managing director Mmetla Masire said on Tuesday.

ODC, which reported a record $1.1 billion in revenue in 2022, holds 10 auctions a year to sell its 25% allocation of production from Debswana Diamond Company, a joint venture between Anglo American’s (AAL.L) De Beers and Botswana, in terms of the partners’ gem sales agreement.

Debswana produced about 24 million carats last year, with ODC getting an allocation of about 6 million carats.

The company has cancelled its November auction and a decision on the December sale is still to be made as the industry battles slowing demand for cut and polished diamonds in the U.S and China, Masire said.

“For the first time, we have had to build up inventory as we do not want to just irresponsibly release goods into a market which is already oversupplied,” Masire said in an interview. “For now, we have stopped the auctions, we will decide on the December auction.”

Last month, trade bodies in India, which cuts and polishes 90% of the world’s rough diamonds, urged members to halt rough diamond imports for two months to manage supplies and aid prices due to weak demand.

In August, De Beers said it would allow its customers to defer some of their purchases for the rest of the year.

As part of a new agreement between De Beers and Botswana, ODC’s allocation is set to rise to 7 million carats. Masire said the company was working on introducing contract sales, a model that De Beers uses to sell 90 % of its supply, among other new sales channels.

“We are still to decide on what percentage of our allocation will be sold through contract sales to complement our auctions,” Masire said. “We are likely to have two-year sales contracts and we are looking at going into partnership with only a limited number of buyers so that we can better serve them.”

Source: DCLA

HB Antwerp co-founders clash over gem trader’s future as Botswana deal looms

Diamond processor and trader HB Antwerp said on Monday it had removed one of its three co-founders from management following differences over strategy, a development that comes amid a pending sales pact with major producer Botswana.

Oded Mansori, who co-founded HB Antwerp in 2020 with partners Shai de Toledo and Rafael Papismedov, said he was taking them to court over his removal.

“On September 1, HB terminated Mr Oded Mansori’s management role in all the HB Companies,” the Belgian company said in a statement, citing a “sharp difference in strategic vision and approaches to business”.

The government of Botswana, the world’s No. 1 diamond producer by value, said in March that it had agreed to buy a 24% stake in HB Antwerp. As part of the deal, state-owned Okavango Diamond Company would supply HB with an undisclosed quantity of rough diamonds for five years.

The deal is yet to be signed.

Mansori, a long-time diamond dealer, said in a separate statement that he was “determined to defend his vision and to fight for the wellbeing and the future of HB,” and that “a legal process is currently underway in court.”

Mansori, who declined to comment further, said he was still a shareholder in the company.

HB also has a partnership with Lucara Diamond Corp, buying stones of 10 carat quality and above from the Toronto-listed miner’s Karowe Mine in central Botswana at prices based on the estimated polished outcome of each diamond.

Lucara did not immediately respond to a request for comment on whether the legal tussle could impact its own deal with HB Antwerp.

In 2022, HB Antwerp partnered with Microsoft to track mined gems via blockchain, as consumers focus on clearing the supply chain of fraudsters and diamonds mined in war zones and sold to fund insurgencies.

Other diamond miners, including Anglo American’s unit De Beers, also use blockchain platforms to trace their diamonds and verify authenticity.

Source: DCLA

Lucara Unearths 692ct. Rough at Karowe

Lucara Diamond Corp. has recovered a 692.3-carat diamond from its Karowe mine in Botswana, the second massive rough from the deposit this month.

The white, type IIa stone came from the EM/PK(S) unit in the south lobe, known for its large, high-quality rough, Lucara said Monday. The miner found the diamond via its XRT unit, which uses X-ray technology to identify huge stones in large pieces of ore before they get broken up.

The new discovery is the fourth diamond over 300 carats that Lucara has unearthed so far this year, including one earlier this month: a high-quality white, type IIa rough weighing 1,080.1 carats, which the miner announced on August 8.

In addition, “this stone is the 20th diamond larger than 100 carats recovered during 2023 at Karowe,” said Lucara CEO William Lamb. “The recovery of large diamonds from the EM/PK(S) lithology of the south lobe strongly supports our expectations for the underground project.”

Lamb, who replaced Eira Thomas as CEO earlier this month, will lead the continued development of Karowe’s underground expansion. The miner invested $683 million in the project, which it believes will extend the mine’s life until at least 2040, 15 years beyond the original 2025 closure date.

In its most recent results, Lucara announced a 21% drop in its second-quarter revenue to $41.1 million amid a slowdown in market demand. Profit slid 60% to $5 million.

Source: DCLA

Karowe Mine Yields Massive Rough Diamond Weighing 1.080 carats.

Lucara Diamond Corp. has recovered a 1,080.1-carat rough diamond from its Karowe mine in Botswana, its fourth topping the 1,000-carat mark in eight years.

The white, type-IIA stone came from the site’s south lobe, known for its large, high-quality rough, Lucara said Wednesday.

The diamond showed up in the miner’s Coarse XRT unit, a recovery circuit that uses X-ray technology to identify huge stones in large pieces of ore before they’re broken up.

Since 2015, the south lobe of Karowe’s AK6 kimberlite has yielded three other diamonds in this size class: the 1,109-carat Lesedi La Rona that year, the 1,758-carat Sewelô in 2019, and a 1,174.76-carat clivage diamond in 2021.

“Lucara is extremely pleased to be reporting the recovery of another large, high-quality gem diamond in excess of 1,000 carats,” said Lucara CEO Eira Thomas on Wednesday. “As we progress mining deeper in the open pit and transition to underground mining exclusively in the south lobe, the preponderance of large, high-value stones is increasing.”

The miner is investing $683 million in Karowe’s underground expansion — a move it says will extend the mine’s life until at least 2040, 15 years beyond the original 2025 closure date.

Source: DCLA

Diamonds are for now: Botswana reach new deal with De Beers

Botswana has reached an eleventh-hour deal with diamond giant De Beers after months of tense negotiations that saw the continent’s top producer threatening to cut ties with the storied company.

The Botswana government and Anglo-American, the majority owner of De Beers, have reached an “agreement in principle”, the two sides said in a statement issued late Friday.

The agreement provides for a new 10-year agreement to sell the rough diamonds produced by Debswana — a joint venture equally owned by the government and De Beers — and a 25-year extension of its mining licenses.

The agreement also gives Botswana an increased 30 percent of diamond production for sale via the state-owned Okavango Diamond Company, progressively increasing to 50 percent in the final year of the contract, De Beers said in a separate statement on Saturday.

No value was given for the agreement.

The previous 2011 sale agreement between the southern African country, one of the continent’s richest, and the world’s largest diamond company by value, was extended exceptionally until June 30, 2023, due to the coronavirus pandemic.

Under terms negotiated by the two sides in 2011, De Beers received 90 percent of the rough diamonds mined, while Botswana had 10 percent to sell itself.

In 2020, Botswana’s share was hiked to 25 percent.

President Mokgweetsi Masisi had threatened to cut ties with the company if the latest talks proved unfavourable for his country.

“If we don’t achieve a win-win situation each party will have to pack its bags and go,” he said in February.

The country turned up the heat the following month by announcing it would soon conclude an agreement to take a 24 percent stake in the Belgian diamond manufacturer HB Antwerp.

Last year, De Beers obtained about 70 percent of its rough diamonds from Botswana.

Diamond mining accounts for a third of the landlocked country’s GDP.

Source: DCLA

The Industry’s Diamond-Origin Conundrum

The Group of Seven (G7) meeting that took place in Japan in mid-May proved to be an anticlimax for the diamond trade.

The industry had expected a major announcement to come from the meeting relating to required declarations on the origin of diamonds imported to those countries — an additional measure that would help prevent polished diamonds sourced from Russian-origin rough entering their markets.

While a clear guideline did not emerge, the member nations — Canada, France, Germany, Italy, Japan, the United Kingdom and the United States — pledged to work toward such measures.

“In order to reduce the revenues that Russia extracts from the export of diamonds, we will continue to restrict the trade in and use of diamonds mined, processed or produced in Russia,” the group said after the meeting.

As it stands, the US and the UK have implemented bans on diamonds sourced directly from Russia. However, the sanctions don’t account for “substantial transformation,” and consequently the manufacturing center is regarded as the source. For example, diamonds polished in Belgium, India, Israel or the United Arab Emirates (UAE) from Russian rough can technically be imported to the US.

Implementing such detailed declarations is proving more complicated than originally thought. Creating such mechanisms will take time, as Feriel Zerouki, the De Beers executive who heads the World Diamond Council (WDC), said in a recent panel discussion at the JCK Las Vegas show in early June. These measures would apply to the entire industry, seemingly requiring a disclosure of origin for all diamonds at customs.

“How do we support the [sanctions] without paralyzing the industry and making it very cumbersome for natural diamonds to enter the G7 countries,” Zerouki challenged the Las Vegas audience.

Setting standards
It’s a sensitive point for an already heavily audited industry, and for companies in each segment of the supply chain that would bear the added expense of verifying such information.

It’s also worth noting that the G7 cannot enact such requirements as a bloc. It will be left to each country to implement its own import rules. That said, there does at least seem to be an effort among those countries to apply some consistency in their systems. It was an open secret that members of various governments and industry bodies met in Las Vegas during the show to advance these discussions, which presumably covered a wide spectrum of industry-related issues.

Central to the talks must surely be the practicality of such declarations. What mechanisms are available to the industry that would facilitate traceability? And who verifies that these initiatives meet the required standards? And on what are those standards based?

The trade has at its disposal industry structures as well as company programs that tackle the challenge of traceability and source verification — although arguably nothing is foolproof.

See full article here

Botswana president insists on bigger share of diamonds from De Beers venture

Botswana will not back down on demands for a bigger share of rough diamonds from its joint venture with De Beers, President Mokgweetsi Masisi said on Thursday, upping the stakes as talks for a new sales deal appear to be stalling.

Botswana and De Beers mine the precious stones through their equally owned, 54-year-old mining venture, Debswana Diamond Co. The current diamond sales deal, in place since 2011, has been extended three times since 2020 but is set to expire next month.

De Beers, a unit of Anglo American Plc, gets 75% of Debswana’s production, which was 24 million carats in 2022. The balance is sold to state-owned Okavango Diamond Company, a vehicle established in 2011 as Botswana began moves to independently sell some gems outside of the De Beers system.

Masisi, who has been Botswana’s president since 2018 and will seek re-election in next year’s elections, now wants Botswana to sell more of its diamonds outside the De Beers channel.

“Our agreement with De Beers is very restrictive to us. We signed it at a time when we didn’t know much, but now our eyes are open,” Masisi said at a community meeting in Mmadinare, 400 kilometres (248.55 miles) north-east of the capital, Gaborone.

Masisi hinted at a possible stalemate and litigation over the sales agreement.

“Even if we lose the litigation, our diamonds will remain ours and we will never give in. If I am going to lose votes because of this issue, then so be it,” said Masisi, speaking in Setswana.

Masisi has previously threatened to walk away from the talks if Botswana does not get a bigger share of Debswana’s output for marketing outside the De Beers system. The government has not publicly stated what share it seeks, but it is believed to be as high as 50%, double the current allocation.

De Beers was not immediately available to comment.

The diamond giant says Botswana receives more than 80% of returns from Debswana, after taxes and royalties are factored in. De Beers has previously expressed confidence that its five-decade partnership with Botswana will continue, on terms “that make economic and strategic sense for both parties.”

Source: DCLA

Botswana threatens break-up with De Beers in push for better diamond deal

Botswana may not renew a five-decade sales agreement with De Beers if the diamond producer doesn’t offer a larger share of rough diamonds to the state’s gem trading company, Okavango Diamond Company (ODC).

The move comes after the southern Africa nation acquired last month a 24% stake in Belgian diamond processing firm HB Antwerp for an undisclosed sum.

Analysts saw this deal as a way for Botswana to loosen the Anglo American-owned miner’s grip on its diamond sector, which is a major source of employment and tax revenue for the country.

De Beers and Botswana jointly own Debswana, which mines almost all of the roughs gems in the country — the world’s second-largest diamond producing nation after Russia.

The partnership has helped Botswana become one of Africa’s fastest growing economies, while supplying De Beers 75% of Debswana’s rough diamonds, which are then sorted and sold to sightholders around the world.

Debswana’s diamond sales hit a record $4.6 billion in 2022, compared to $3.4 billion in 2021.

President Mokgweetsi Masisi has threatened to walk away from the talks if Botswana does not get a larger share of Debswana’s output for marketing outside the De Beers system.

The government has not publicly stated what share it seeks, but it is believed to be as high as 50%, double its current allocation.

The two parties have been negotiating for several years to extend their 2011 mining rights and sales agreement, which is due to expire in June this year.

“Colonial” model
Rafael Papismedov, co-founder of HB Antwerp, told the Financial Times that a revised deal would help Botswana break free from the current model of being “stuck in a box that says you can only dig and wash the diamonds.”

Papismedov added that De Beers’ operating model carries on “colonization” principles, acting as if Botswana was incapable of building midstream capabilities for polishing diamonds.

Masisi wants more locals employed in the diamond sector, which accounts for a fifth of the country’s gross domestic product.

The largest diamond producer by value has said it is confident that it can maintain its partnership with Botswana, but that some of the negotiations are complex and require more time.

De Beers has said that the arrangement must make economic and strategic sense for both parties, adding that it is committed to supporting Botswana’s aspirations to grow its diamond industry.

The stakes are high for both sides, as they seek to secure their future in a volatile and competitive industry that has been hit by the covid-19 pandemic, changing consumer preferences and ethical concerns.

A new deal between Botswana and De Beers could have significant implications for the global diamond supply chain and the balance of power in the sector.

Source: mining.com

The 10.57-Carat ‘Eternal Pink’ Diamond Could Fetch $35 Million At Sotheby’s

“The Eternal Pink,” a 10.57-carat internally flawless fancy vivid purplish-pink diamond

“The Eternal Pink,” a 10.57-carat internally flawless fancy vivid purplish-pink diamond, will be offered at Sotheby’s New York on June 8. Its estimate is $35 million, which if achieved, would make it one of the most valuable gems ever sold at auction.

Its per-carat estimate of more than $3.3 million is the largest such estimate ever placed on a diamond or gemstone, according to Sotheby’s.

Quig Bruning, head of Sotheby’s Jewelry, Americas, says it’s the most vivid pink diamond to ever to come to market. “This color is the most beautiful and concentrated shade of pink in diamonds that I have ever seen.”

The cushion-shaped diamond will first be on view in Hong Kong April 1 – 7 to coincide with the 50th anniversary of Sotheby’s presence in Asia. The gem will then travel to Dubai, Singapore, Shanghai, Taiwan and Geneva before being offered as the top lot at Sotheby’s New York Magnificent Jewels auction on June 8.

The 23.78-carat rough which yielded The Eternal Pink was mined by De Beers at the Damtshaa mine in Botswana. Diamond manufacturer, Diacore, took six months to cut and polish the gem into its current color, described as “bubblegum” by the auction house.

“This stunning diamond is the best of the best when it comes to exceptional pink diamonds and it is difficult to overstate its rarity and beauty,” said Wenhao Yu, chairman of Jewellery and Watches at Sotheby’s Asia.

Sotheby’s has had some experience with important pink diamonds. The auction house sold the record-breaking CTF Pink Star, a 59.60-carat oval mixed-cut Fancy Vivid Pink Internally Flawless diamond, sold for $71.2 million—a world auction record for a diamond and any gemstone or jewel—in Hong Kong in April 2017. More recently, Sotheby’s sold the Williamson Pink Star, an 11.15-carat fancy vivid pink internally flawless diamond, for $57.7 million in a single-lot auction at Sotheby’s Hong Kong on October 8, 2022, setting the world record price per carat for any diamond or gemstone at more than $5.1 million.

Colored diamonds continue to demand high prices at auction with exceptional pink and blue diamonds leading the way. It is because of their rarity, according to Sotheby’s. Of all the diamonds submitted to the Gemological Institute of America, fewer than 3% are classified as colored diamonds. Within these colored diamonds, pink is one of the rarest to occur naturally in diamonds. A diamond that is more than 10 carats, with strong color, internally flawless clarity, and classified as a “vivid pink,” the highest grade for a pink diamond is extremely rare.

Source: forbes

HB Antwerp Invests in Botswana’s Young Diamond Talent

HB Antwerp has announced a partnership with Botswana to foster a new generation of diamond talent.

It has signed a a five-year memorandum of understanding with the Botswana International University of Science and Technology (BIUST).

They will jointly organize traineeships for Botswanan youth, offer scholarships for promising local talent, drive innovative projects backed by digital supply chains, and create job opportunities in the diamond sector.

The move comes as Botswana threatens to walk away from its long-standing sales agreement with De Beers, which is due for renewal at the end of June.

There has been media speculation that the Okavango Diamond Company (ODC), wholly owned by the Botswana government, was planning to sell its specials (+10.8-carats) to Belgian manufacturer HB Antwerp and to Canada-based Lucara and instead of De Beers.

HB Antwerp says it promotes respect for local communities, fair labor and pay, and investment in skills training and job placement opportunities for local workers.

Rafael Papismedov, its managing partner and strategy director, said: “Young people in Africa have incredible potential, but often do not have access to meaningful opportunities.

“We believe in the power of diamonds to catalyze positive change and look forward to leveraging this partnership to deliver on that potential for the Botswanan people.”

Source: DCLA

Botswana’s diamond trade is expected to depreciate due to reduced demand

Botswana diamond mining

Botswana’s finance ministry disclosed that the diamond trade in Botswana is set to fall back in 2023, due to reduced demand.
This is as opposed to 2022 when Botswana’s total mining production increased by 8.2%.
Botswana anticipates that the production of diamonds would fall by 1% in 2023, and growth in the diamond trade will decrease to 7%.
An official from Botswana’s finance ministry stated on Wednesday that Botswana anticipates its mining sector’s production to remain flat this year as the diamond business loses its luster as a result of a decline in consumer spending and reduced demand for diamond jewelry.

In 2022, the total mining production increased by 8.2%. Although Botswana is the continent’s biggest producer of diamonds, this year’s improvements in copper and coal will not make up for the fall in this commodity.

About the majority of Botswana’s diamonds are produced by Debswana, a joint venture between the government of Botswana and De Beers, a division of Anglo American Plc (AAL.L). In 2022, production increased by 8% to 24.1 million carats.

Trading in diamonds increased 41% in the last year, with Botswana also benefiting from Western consumers avoiding Russian stones as a result of its invasion of Ukraine.

Botswana anticipates that the production of diamonds would fall by 1% in 2023 and that growth in the diamond trade will decrease to 7% from 41% in 2018.

Botswana’s finance ministry senior policy advisor, Keith Jefferis expressed the same sentiments in a statement to the American-based news agency, Reuters.

He noted that the diamond trade would face a major setback during the year, due to a slowdown in consumer demand, particularly in the USA.

He stated, “We see the diamond sector having a bit of a tough year due to an expected slowdown in consumer demand particularly in the USA, because of pressure on real income and consumption.”

High demand for coal and anticipated increases in copper mine production will somewhat offset this.

The Motheo copper mine, owned by Sandfire Resources (SFR.AX), is scheduled to begin operations this year, while the Kalahari Copperbelt’s Khoemacau copper mine is ramping up production to reach its nominal capacity of 60,000 tonnes annually.

The two active coal mines in Botswana the state-owned Morupule and Minergy’s (MIN.BT) Masama mine saw record exports in 2017 and are now considering increasing output to keep up with the country’s high demand for coal internationally.

According to forecasts from the finance ministry, the government anticipates mining royalties to decrease from 6.1 billion pula ($3.41 billion) last year to 4,5 billion pula ($3.41 billion) in 2023. The amount of dividends owed to the state would likewise decrease, from 15 billion to 11,3 billion pesos, in 2022.

Source: africa.businessinsider

Botswana, De Beers row over diamond profits

Botswana diamonds and De Beers

Botswana’s President Mokgweetsi Masisi warned Sunday that his country could sever ties with South African diamond giant De Beers if talks to renegotiate a sales agreement prove unfavorable for his country.

The 2011 sales agreement governing the terms of marketing diamonds produced by Debswana – a 50-50 joint venture between the government and De Beers – expired in 2021.

It has been extended by the parties, who cited the coronavirus outbreak as the reason for the delay in concluding negotiations, and will end on June 30, 2023.

Speaking at a rally of his ruling Botswana Democratic Party (BDP) in his home village of Moshupa, about 65 kilometers from the capital Gaborone, Masisi warned, “If we don’t reach a win-win situation, each side will have to pack up and go home.”

Under the 2011 agreement, the mining company De Beers received 90% of the rough diamonds produced while Botswana, Africa’s largest diamond producer, received 10%. In 2020, Botswana’s share was increased to 25%.

In 2020, Botswana’s share was increased to 25%.

Today, “we got a glimpse of how the diamond market works, and we found out that we received less than we should have,” said Mr. Masisi, who spoke in both English and the local language, Tswana.

“We also found out that our diamonds are bringing in a lot of profit and that the (2011) agreement had not been favorable to us,” he added, before warning: “We want a bigger share of our diamonds. Business cannot continue as before.

Source: DCLA

Botswana Has the World’s Two Richest Diamond Mines

 

                 Diamond mine, in Botswana

A new list names the Jwaneng diamond mine, in Botswana, as the world’s richest diamond mine.

A new list by miningintelligence.com, quoted by IDEX Online, names the Jwaneng diamond mine, in Botswana, as the world’s richest diamond mine for the first three quarters of 2022. Jwaneng produced 10.3 million carats in 2022.

Orapa, also in Botswana, came second with 8 million carats. Both Jwaneng and Orapa are operated by Debswana, a partnership between De Beers and the government of Botswana. Jwaneng and Orapa were also listed as the two highest value diamond mines in the world, estimated at $1.25 billion and $976 million respectively, “based on average historic annualized prices of $121.5 per carat,” according to the report.

Alrrosa’s Udachny mine came third. Although Alrosa has not published production figures since the war with Ukraine, miningintelligence.com bases its conclusion on the mine’s 2021 production of 4.6 million carats. Fourth comes the Venetia mine in South Africa 4.6m carats, operated by De Beers. In fifth is Nyurba, in Russia, with 3.6 million carats, based on 2021 numbers.

Source: israelidiamond

Jwaneng is World's Richest Diamond Mine

                    Diamond mine Botswana

The world’s richest diamond mine for the first three quarters of 2022 was Jwaneng, in Botswana, with 10.3m carats.

Orapa, also in Botswana, was second-placed with 8.0m carats, according to newly-published figures from miningintelligence.com.

Both mines are operated by Debswana, a partnership between De Beers and the government of Botswana.

Third on the list is Udachny mine, operated by Alrosa, the sanctioned Russian miner. The 4.6m-carat figure is based on its 2021 production, assuming trends since 2019 continued.

Fourth is the Venetia mine, in South Africa (4.6m carats), operated by De Beers and fifth is Nyurba, in Russia, with 3.6m carats (with same caveat as for Udachny).

Jwaneng and Orapa are also listed as the two highest value diamond mines, estimated at $1.25bn and $976m, both based on average historic annualized prices of $121.5 per carat.

Source: DCLA

Lucara Sales Fall Amid Lack of High-Value Diamonds

          Lucara Diamonds – Karowe Diamond Mine

Lucara Diamond Corp.’s sales dropped in the third quarter as the company supplied fewer large and expensive stones from its lucrative Karowe mine in Botswana.

Revenue fell 31% year on year to $49.9 million, while net profit slumped 86% to $1.8 million, Lucara reported Wednesday.

Sales of rough from Karowe declined 36% to $46.5 million, with volume down 15% at 99,301 carats and the average price falling 43% to $337 per carat. The remaining revenue came from sales of third-party goods on Lucara’s Clara online platform.

Management blamed a decrease in the number of high-value diamonds the company sold to HB Antwerp through the pair’s supply agreement. The Belgian manufacturer is contracted to buy all Karowe rough of 10.8 carats or more, with Lucara receiving a proportion of the final polished proceeds.

In the third quarter a year earlier, Lucara sold four pink diamonds and two white, type IIa stones — weighing 393.5 and 257.5 carats — to HB. As a result of the unfavorable comparison, revenue from the agreement plummeted 46% to $27.1 million.

“Despite the overall decrease in revenue recognized in [the third quarter], diamond-market fundamentals continued to support healthy prices as steady demand and some inventory shortages were reported,” Lucara said. Fluctuation in the availability of 10.8-carat production is expected, it added.

Output from Karowe slid 19% year on year to 78,879 carats for the quarter.

Source: DCLA

Debswana posts 37.5% jump in 9-month diamond sales

 

Rough diamonds sales by Debswana Diamond Company jumped 37.5% in the first nine months of 2022, statistics released by the Bank of Botswana showed Tuesday, driven by steady demand for jewellery.

A joint venture between Anglo American unit De Beers and Botswana government, Debswana sells 75% of its output to De Beers with the balance taken up by state-owned Okavango Diamond Company.

Debswana’s January-September sales rose to $3.578 billion from $2.602 billion a year earlier, data from the central bank showed.

In Botswana’s pula currency, Debswana’s rough diamond sales rose 52.5% to 43.237 billion pula reflecting a stronger dollar in the period.

In dollar and pula terms, the nine-month sales top the company’s full-year results in 2021 when sales totalled $3.466 billion and 38.134 billion pula.

Debswana accounts for almost all diamonds produced in Botswana with Lucara’s Karowe mine being the only other operating diamond mine in the country.

Botswana generates about 30% of its revenue and 70% of its foreign exchange earnings from diamonds.

However, De Beers sees the risk of the market slowing down in the coming months due to a deterioration in global economic conditions, reduced consumer spending and continued Chinese covid-19 lockdowns.

“In line with normal seasonal trends, we anticipate that sales in the final quarter of the year will be affected by the normal temporary closure of cutting and polishing factories for the religious holidays in India,” parent firm Anglo American said last week.

Source: DCLA