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Southern Africa continues to dominate diamond mining

11 august 2014

The latest production and trade data published by the Kimberley Process Certification Scheme (KP) has confirmed that southern Africa is still the world leader in diamond mining.

Three countries fr om the region made it to the top five of global diamond producers by value.

As expected, Botswana topped the list having produced diamonds worth $3.63 billion in 2013.

Botswana's average price of rough diamonds was also up 8 percent to $156.36 per carat.

Namibia was ranked fourth after Russia and Canada respectively.

Its production increased 15 percent to $1.36 billion fr om 1.689 million carats while the average price leaped 46 percent to $805.24 per carat.

Namibia had the highest priced diamonds in the world overtaking Lesotho (another southern African country) wh ere the average price of rough production fell 7 percent to $584.88 per carat.

Angola was number five as its output grew 15 percent to $1.28 billion from 9.36 million carats while its average price rose 2 percent to $136.49 per carat.

Southern Africa also had two countries that made it to the top five of diamond producers in the world by volume.

Botswana was second after Russia, as its production increased 13 percent to 23.187 million carats.

The Democratic Republic of Congo (DRC) was third having produced just above 12 percent of the world’s total output last year or 15.7 million carats.

Global production increased 2 percent to 130.482 million carats by volume in 2013.

In January, De Beers group chief executive Philippe Mellier said Southern Africa had become the new centre of gravity for the diamond trade and the relationship between Sightholders and the group had been fundamental to this shift.

De Beers’ international Sightholder sales activities moved to Gaborone, Botswana from London last year.

 “Of course, this relationship has been at the forefront of many of the key developments in the history of diamonds, whether it is catalysing growth in beneficiation or growing consumer demand for diamond jewelry in new consumer markets," he said.

Botswana, said Mellier, had grown from being a primary producer with a maturing manufacturing sector into one of the world’s key rough diamond trading destinations.

"Not only does this bring increased economic activity and a regular influx of successful entrepreneurs to Gaborone, but it also sends a message to the global business community that Botswana is so much more than the world’s leading diamond producing country,” he said.

Although, South Africa could not reach the top five (both in terms of volume and value), its output increased 15 percent to $1.19 billion from 8.143 million carats while the average price of its diamonds was flat at $145.54 per carat.

De Beers told Rough&Polished that South Africa, just like Botswana, was highly prospective, and geologically form part of the same cratonic region in southern Africa.

It said South Africa was considered highly prospective for new kimberlite discoveries, although it would not divulge areas of interest, given the competitive nature of the business.

Meanwhile, Zimbabwe betrayed its neighbours as production from the southern African country fell 14 percent to $538.5 million.

Its volume of production, according to the KP data, also eased 14 percent to 10.411 million carats while the average price dropped 3 percent to $51.72 per carat.

Miners in Marange had been complaining that the quality and quantity of diamonds mined in the area had been on a decline since 2012.

The miners want Harare to allocate them with new mining concessions as their block were fast running out of alluvial gems.

"It now takes the companies more than four tonnes of gravel to get only 15 carats of gems, which clearly shows alluvial diamonds have been depleted," an official from Anjin was quoted as saying by Zimbabwe Independent last November.

"The revenue has tremendously declined by as much as 90 percent over the past few months."

However, Harare no longer wants the half a dozen miners operating in Marange.

It indicated recently that the merging of diamond mining firms to streamline their operations and ensure accountability of proceeds had already started.

Mines and Mining Development Minister Walter Chidhakwa was quoted by The Herald newspaper as saying that Marange Resources and Gye Nyame were recently merged and a formal announcement would be made soon.

“We are gradually moving towards consolidation,” said Chidhakwa.

“What I can say for now is that our guys are finishing working on the liabilities and value of assets for Marange Resources and Gye Nyame and an announcement will be made soon on their consolidation.”

Chidhakwa said negotiations were also under way with other mining companies in Chiadzwa wh ere Government had no total control.

It remains to be seen whether this would improve output and transparency in the troubled mining area, which had promised to be a blessing for Zimbabwe.

There was no doubt that the latest KP statistics would make Zimbabwe up its game, as far as bringing sanity in Marange was concerned.

If no tangible changes are implemented, then Marange would continue on a downward spiral, while its neighbours remain major drivers of global diamond production.

Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished