Maravi

(HERALD) Zim diamonds shake market

Zim diamonds shake market
Monday, 06 February 2012 00:00
Takunda Maodza Senior Reporter

MARANGE diamonds have brought stiff competition on the international market, causing prices to fall sharply, especially in India. This has left traditional giants like De-beers in a quandary.

Zimbabwe Mining Development Corporation chairman Mr Godwills Masimirembwa yesterday said the development meant Zimbabwe was now a force to reckon with on the diamond market.

According to reports from India, prices of rough diamonds from De Beers and Alrosa of Russia fell last month in Surat easing up to 10 percent as a result of competition from the Zimbabwe gems.

India's Surat is the world's biggest diamond-cutting and polishing centre.

The market dominance by Zimbabwe's gems comes a few months after the Kimberley Process Certification Scheme gave Zimbabwe the green light to trade in its Marange diamonds despite resistance from the US and Europe.

But India opened up to the Marange diamonds soon after the KP allowed the country to sell its gems without hindrance at its meeting in DRC last year.

The reports said low range diamond boxes of the leading giant diamond mining companies were selling at discounted rates of up to 25 percent in Surat and Mumbai.

"Zimbabwe is set to rule the global rough diamond supply market in the next few years. Right now, the country is offering its average goods at US$40 per carat, which is very cheap compared to other mining countries, whose diamonds are sold above US$100 per carat.

"Already, Indian cutters are aware that the Marange goods offer them best margins in the market," reported The Times of India, quoting a diamond analyst Anirudh Lidbide.

India is optimistic that Zimbabwe will influence the price and demand for rough diamonds this year in a market that was largely dominated by De Beers, Alrosa and Rio Tinto.

About 11 million carats of Marange diamonds are expected on the international market this year, ending supply shortages and price wars.

"Industry experts said Zimbabwe diamonds are expected to flow in the market in huge volumes throughout the year.

"This would further put an end to the price wars and the supply shortage experienced by Surat diamantaires post-recession," added The Times of India.

Mr Masimirembwa said: "Zimbabwe is a force to reckon with and let those who cry, cry. We are in the market and we are not getting out of it."

He was quick to state that Zimbabwe will not irresponsibly flood the market.

"We are responsible producers. We will not unnecessarily flood the market. We want the people of Zimbabwe to benefit from their diamonds.

"We will produce at that level that will make it viable for producers and generate adequate revenue for our people."

He said Zimbabwe will strive to sell its diamonds irrespective of the US embargo.

"We have a product wanted by people out there and we will sell it by all means possible.

"We are KP compliant, which is the most important thing, and we will continue to follow the KP rules but we will not be deterred by illegal sanctions," said Mr Masimirembwa.

The US administration imposed sanctions on Mbada Diamonds and Marange Resources, two major diamond miners at Chiadzwa, in a bid to frustrate Zimbabwe's efforts to sell its gems.

Labels: DEBEERS, DIAMONDS

posted by MrK @ 3:11 PM