Graff Unit Signs Polishing Deal with Lucapa

Graff-owned diamond manufacturer Safdico will cut and polish a portion of rough from the Lulo mine through a partnership with Lucapa Diamond Company.

Safdico will have the rights to buy up to 60% of Lulo’s annual rough production under the terms of Angola’s new reform program, which went into effect last year. The new guidelines open sales to a wider range of buyers of the miner’s choosing, rather than forcing producers to sell to a list of clients approved by state-owned diamond company Sodiam.

All diamonds Safdico purchases from Lucapa will be placed into the joint partnership, the miner said Wednesday. Once polished, procurement and manufacturing costs will be deducted, with any profit from the sale of the polished diamond to be split equally between Lucapa and Safdico.

Safdico has already purchased 4,900 carats of rough from Lucapa through the partnership. Profits from the sale of the first batch of polished will be realized in the first quarter, Lucapa noted.

Lucapa, which operates the mine in Angola, first announced its intention to polish its own diamonds in February 2019 in an effort to maximize shareholder value by cutting out third-party manufacturers. Earlier this month, the company also debuted its first polished stones from the Mothae mine in Lesotho. Those included six D-color diamonds from a 36-carat rough, the largest of which was a pear-shaped, 8.88-carat, flawless stone.

Lucapa also plans to expand its total group production to more than 60,000 carats in 2020, it said.

“This production increase, coupled with the new revenue streams generated from the cutting and polishing agreement with Safdico, will enable [the company] to generate higher returns for its partners,” Lucapa explained.

Source: DCLA

Graff Unit Signs Polishing Deal with Lucapa

Graff-owned diamond manufacturer Safdico will cut and polish a portion of rough from the Lulo mine through a partnership with Lucapa Diamond Company.

Safdico will have the rights to buy up to 60% of Lulo’s annual rough production under the terms of Angola’s new reform program, which went into effect last year. The new guidelines open sales to a wider range of buyers of the miner’s choosing, rather than forcing producers to sell to a list of clients approved by state-owned diamond company Sodiam.

All diamonds Safdico purchases from Lucapa will be placed into the joint partnership, the miner said Wednesday. Once polished, procurement and manufacturing costs will be deducted, with any profit from the sale of the polished diamond to be split equally between Lucapa and Safdico.

Safdico has already purchased 4,900 carats of rough from Lucapa through the partnership. Profits from the sale of the first batch of polished will be realized in the first quarter, Lucapa noted.

Lucapa, which operates the mine in Angola, first announced its intention to polish its own diamonds in February 2019 in an effort to maximize shareholder value by cutting out third-party manufacturers. Earlier this month, the company also debuted its first polished stones from the Mothae mine in Lesotho. Those included six D-color diamonds from a 36-carat rough, the largest of which was a pear-shaped, 8.88-carat, flawless stone.

Lucapa also plans to expand its total group production to more than 60,000 carats in 2020, it said.

“This production increase, coupled with the new revenue streams generated from the cutting and polishing agreement with Safdico, will enable [the company] to generate higher returns for its partners,” Lucapa explained.

Source: DCLA

Swarovski Debuts New Lab-Grown Diamond Colors

Crystal brand Swarovski introduced 16 new synthetic-diamond colors at Paris Haute Couture Fashion Week.

The new hues fall into four creative categories in which Swarovski claims to play a role, it said last week. Each of the four areas — fashion, art, music and architecture — includes four colors of cushion-cut lab-grown diamonds.

Every category in the collection is led by a “hero” color. These include Androgyny Flamingo for fashion, Cubist Sky for art, Heavy Metal Cherry for music, and Gothic Cognac for architecture. Some of the other colors in the collection are Punk Lipstick, Surrealist Butter, Draped Fire and Electro Arctic.

The stones showcased in Paris range from 1.25 to 2.50 carats, while the 16 colors will be available at stores in 0.25- to 1.50-carat sizes.

“I’d like to think that these stones have endless potential, and are able to bring any idea to life,” said Markus Langes-Swarovski, a member of the Austrian jeweler’s executive board. “The colors, cuts and sizes are created to inspire jewelry that has never been made or even dreamed of. It’s a toolbox of unlimited creativity.”

Swarovski first launched laboratory-grown diamonds in 2018.

Source: DCLA

Swarovski Debuts New Lab-Grown Diamond Colors

Crystal brand Swarovski introduced 16 new synthetic-diamond colors at Paris Haute Couture Fashion Week.

The new hues fall into four creative categories in which Swarovski claims to play a role, it said last week. Each of the four areas — fashion, art, music and architecture — includes four colors of cushion-cut lab-grown diamonds.

Every category in the collection is led by a “hero” color. These include Androgyny Flamingo for fashion, Cubist Sky for art, Heavy Metal Cherry for music, and Gothic Cognac for architecture. Some of the other colors in the collection are Punk Lipstick, Surrealist Butter, Draped Fire and Electro Arctic.

The stones showcased in Paris range from 1.25 to 2.50 carats, while the 16 colors will be available at stores in 0.25- to 1.50-carat sizes.

“I’d like to think that these stones have endless potential, and are able to bring any idea to life,” said Markus Langes-Swarovski, a member of the Austrian jeweler’s executive board. “The colors, cuts and sizes are created to inspire jewelry that has never been made or even dreamed of. It’s a toolbox of unlimited creativity.”

Swarovski first launched laboratory-grown diamonds in 2018.

Source: DCLA

De Beers Plans Overhaul of Supply Policy

De Beers plans to abandon its practice of using sightholders’ purchase history as the main factor in determining how it allocates rough supply, sources have told Rapaport News.

The move, which would go into effect from 2021, would see the miner shift to more subjective criteria for deciding the value of goods each client receives.

The current system, known as “demonstrated demand,” requires sightholders to buy the rough that De Beers has allotted them or risk losing access to De Beers’ diamonds in future. The method has faced criticism for encouraging dealers and manufacturers to take on unprofitable inventory.

But with the current sightholder agreement expiring at the end of this year, De Beers has told clients demonstrated demand will not be the main driver of allocations in the new contract period, the sources said. Discussions about the matter continued at this week’s January sight in Botswana.

The proposals include studying data about clients’ business activities, as well as qualitative factors, to help determine whether companies should be on the client list, a sightholder explained on condition of anonymity. De Beers is also considering reducing the number of sightholders, according to a Bloomberg report last week that Rapaport News could not corroborate.

“We will be communicating directly with customers in the coming months about the new sightholder contract period, which will focus on maximizing the considerable opportunities ahead in the diamond sector,” a De Beers spokesperson said. The company would not elaborate on the details.

The midstream’s accumulation of excess inventory contributed to a severe slowdown in the diamond market in 2019, with De Beers’ full-year sales falling 25% to $4.04 billion. Last July, Dutch bank ABN Amro wrote to its clients urging them to buy rough only when it’s profitable, and attacked the practice of making purchases purely to maintain supply allocations.

Sightholders are expecting this week’s De Beers sale — the first of the year — to be relatively large as the trade replenishes its stocks following a solid holiday season. De Beers raised prices in certain categories, sources said.

Soucre: DCLA

De Beers Plans Overhaul of Supply Policy

De Beers plans to abandon its practice of using sightholders’ purchase history as the main factor in determining how it allocates rough supply, sources have told Rapaport News.

The move, which would go into effect from 2021, would see the miner shift to more subjective criteria for deciding the value of goods each client receives.

The current system, known as “demonstrated demand,” requires sightholders to buy the rough that De Beers has allotted them or risk losing access to De Beers’ diamonds in future. The method has faced criticism for encouraging dealers and manufacturers to take on unprofitable inventory.

But with the current sightholder agreement expiring at the end of this year, De Beers has told clients demonstrated demand will not be the main driver of allocations in the new contract period, the sources said. Discussions about the matter continued at this week’s January sight in Botswana.

The proposals include studying data about clients’ business activities, as well as qualitative factors, to help determine whether companies should be on the client list, a sightholder explained on condition of anonymity. De Beers is also considering reducing the number of sightholders, according to a Bloomberg report last week that Rapaport News could not corroborate.

“We will be communicating directly with customers in the coming months about the new sightholder contract period, which will focus on maximizing the considerable opportunities ahead in the diamond sector,” a De Beers spokesperson said. The company would not elaborate on the details.

The midstream’s accumulation of excess inventory contributed to a severe slowdown in the diamond market in 2019, with De Beers’ full-year sales falling 25% to $4.04 billion. Last July, Dutch bank ABN Amro wrote to its clients urging them to buy rough only when it’s profitable, and attacked the practice of making purchases purely to maintain supply allocations.

Sightholders are expecting this week’s De Beers sale — the first of the year — to be relatively large as the trade replenishes its stocks following a solid holiday season. De Beers raised prices in certain categories, sources said.

Soucre: DCLA

Petra Diamonds H1 Production Up, but Revenue Down

Petra Diamonds Limited has announced that while its production for the six months ended December 2019 was up 3 percent to 2,070,240 carats (H1 FY 2019: 2,019,147 carats), revenue for the same period was down 6 percent. Revenue fell to $193.9 million from 1,743,807 carats (H1 FY 2019: $207.1 million from 1,736,357 carats).

The decline in revenue comes from lower diamond prices and the adverse product mix at Finsch and Williamson. This was, however, partially offset by the sale of the 20.08-carat blue diamond from Cullinan for $14.9 million.

The company is currently on track to meet or exceed its FY 2020 production guidance of ca. 3.8 Mcts.

In addition, Petra said it saw growing stability in pricing as the calendar year closed and that demand has continued to improve as the midstream looks to replenish inventory with early indications that rough pricing has improved modestly in the third quarter of 2020. .

Petra reported that its net debt as of December 31, 2019 stood at $596.4 million 

(September 30, 2019: $592.8 million). It also reported a diamond inventory of 992,425 carats valued at $85.2 million compared to $92.4 million for September 30, 2019.

Source: DCLA