Zimbabwe to release MASSIVE DIAMOND RESERVES!

[MidwestDiamondHunter]

Zimbabwe's president said Tuesday his nation will sell its massive reserves of diamonds despite not receiving authorization from the world's diamond control body...

What do you all think about this?! What affect will it have on diamond prices from PS vendors? Should I wait to buy my diamond?


http://finance.yahoo.com/news/Mugabe-Di ... 2.html?x=0

 

[iota15]

I'm curious too.

 

[yssie]

I don't know exactly what's going on here but if the kimberley process will not certify these diamonds I'm pretty darn sure we won't be seeing any of them here in the US (or in other countries that participate)

 

[Regular Guy]

I'm reading in the zeitgeist for the day that the KP people are about to cave, and "green light" all of Zimbabwe's stash, despite obvious human rights abuses associated with them.

THIS is what Rappaport was protesting against.

I do think such a sanction would be unfortunate.

 

[cemrn]

What? The KP is giving them the go ahead? I don't understand that. The whole thing makes my stomach turn. I know you can probably never be completely sure that you diamond isn't a conflict diamond. But I chose a dealer for my diamond who strives to ensure that. How can they do that now? I can tell you I am glad I did all my diamond purchasing in the spring.

 

[Paul-Antwerp]

The article comments on a speech of Zimbabwe's corrupt president Mugabe, so we have to approach this with a grain of salt.

The highest estimate of the reserves of rough diamonds currently in Zimbabwe is 6 million carats. I personally think that this is still a very exaggerated figure. However, in dollar-terms, these mostly brown goods with a preponderance of industrial-quality, at an average value of say $30/Ct represents $180 million, about 2% of worldwide production. That is a fraction of the 1.5 billion mentioned by Zimbabwe's ministry of mines.

Even then, $180 million seems highly exaggerated, since the category 'others' in the diamond-producing countries in the 2009-pipeline (thus including all West-African countries, Brasil, China, India and all other smaller producing countries) stood for only $430 million last year.

I see this speech and the resulting article as typical internal propaganda by the Mugabe-side. The way in which the Ministry of Mines compares their exaggerated figure to the national debt implies that the proceeds would go directly to the state's coffers (ignoring the rights of the private-party owners of the diamonds). This is clearly in line with earlier Mugabe-strategies depicting all western countries as attempting to destabilize the Zimbabwe economy, with only Mugabe personally as the protector of his citizens.

To summarize, the technical information in this article is totally off-base.

 

[Regular Guy]

I'm reading in the zeitgeist for the day that the KP people are about to cave, and "green light" all of Zimbabwe's stash, despite obvious human rights abuses associated with them.

THIS is what Rappaport was protesting against.

I do think such a sanction would be unfortunate.

I believe this is now done...with reporting on Rappaport's Trade Wire:

"Zimbabwe Can Export Rough

The Kimberley Process (KP) reached an agreement that will enable the renewal of rough diamond exports from the Marange diamond fields in Zimbabwe. Consensus was reached across all parties during a mini-KP session hosted by Eli Izhakoff, president of the World Diamond Council, in St. Petersburg this week. The group did not address redefining 'blood diamonds.' "

 

[septsparkle]

So in layman's terms how does this impact the diamond trade as a whole. Is there really no way to know if we are getting blood diamonds (I mean I know it wasn't fool proof, but is the process completely worthless now)? It seems the KP has failed, no? How confident should I be about the origin of my diamond?

I have a stone being set currently with a 30 day return period, I'm wondering if I should just cancel until I have a clear understanding of the impact this will/has overall? I also wonder how this will affect the value/pricing? Any ideas?

 

[WinkHPD]

So in layman's terms how does this impact the diamond trade as a whole. Is there really no way to know if we are getting blood diamonds (I mean I know it wasn't fool proof, but is the process completely worthless now)? It seems the KP has failed, no? How confident should I be about the origin of my diamond?

I have a stone being set currently with a 30 day return period, I'm wondering if I should just cancel until I have a clear understanding of the impact this will/has overall? I also wonder how this will affect the value/pricing? Any ideas?

If they are just now allowing the exportation of diamonds from Zimbabwe to resume it will be some time, a couple of months at the least before those diamonds are in the system. I do not believe there is any reason for you to cancel the purchase of a stone that you have already purchased.

Many diamond cutters will still decline to purchase stones from this area and as Paul mentioned in his post, this is a very small percentage of the diamonds on the market. Perhaps he will come back in this thread and share further information with us.

It is my belief that there are many in the trade who will take additional steps to protect their clients from even the hint of being involved with conflict diamonds. Let's not throw the baby out with the bath water before we see what is really happening. This could actually be a great opportunity for the ethically inclined cutters to step up to the plate by providing in depth information to their clientèle about where their diamonds are coming from.

Wink

 

[septsparkle]

Thanks so much, Wink. I understand what your saying and it makes much sense. This whole situation just gives me a lot less confidence in the process and I wasn't completely sold on it before. I'd be really sickened to find out my diamond was involved in such horrid things. Though, if I am going to do it, I do have confidence in my vendor for their efforts in obtaining "conflict-free" diamonds.

This could actually be a great opportunity for the ethically inclined cutters to step up to the plate by providing in depth information to their clientèle about where their diamonds are coming from.

It would be great if this were to be the outcome of this down the line.

 

[Paul-Antwerp]

As far as I understand, there is a compromise to allow two exports of Zimbabwe-rough in the next months. There will be one shipment in August, after special investigation of the shipment by a KP-process-supervisor, and another one in September. Apparently, both these exports are only of diamonds mined after mid-May, most probably a date chosen because there was a special KP-monitor in the country from around this date.

Production from before mid-May is still not allowed to be exported.

Because of reasons explained earlier, this will have no real effect on the diamond-trade. It will mostly be shady companies interested in these diamonds, and a serious diamond-dealer knows how to avoid the shady ones.

Live long,

 

[septsparkle]

As far as I understand, there is a compromise to allow two exports of Zimbabwe-rough in the next months. There will be one shipment in August, after special investigation of the shipment by a KP-process-supervisor, and another one in September. Apparently, both these exports are only of diamonds mined after mid-May, most probably a date chosen because there was a special KP-monitor in the country from around this date.

Production from before mid-May is still not allowed to be exported.

Because of reasons explained earlier, this will have no real effect on the diamond-trade. It will mostly be shady companies interested in these diamonds, and a serious diamond-dealer knows how to avoid the shady ones.

Live long,

Thank you. I spent the evening reading articles and researching as much as possible online and came to the same conclusion online about the two exports, etc. I just never know how accurate the sources are.

 

[Regular Guy]

My google alert today on the Kimberley Process arrived to I think confirm Paul's basic observation, as today, reporting from the New York Times:

http://www.nytimes.com/2010/07/17/world ... .html?_r=1

My temporary insight is that while sand is being moved productively from one place to the other, this is better than the alternative.

Or, take a glass with the water 1/2 way up, you can call it half empty or half full.

With leadership, you can observe a wise leader will not ask his minions to follow where they will not go. The leadership of the Kimberley Process will really have a difficult time having Joe consumer do anything besides continue to buy diamonds that are presented to them, and so, to outlaw goods from KP, and have the buying public not follow this directive....would not be good. So, what to do.

When you can't tell the sun to change directions in the sky, you could make sure your directions conform to what is already happening.

That, or find some leverage that works.

Perhaps the wonder is that the Kimberley Process came together in the first place. Who knows how that happened?

Anyway, although it's likely these guys are doing the best they can, under the circumstance, I hope somebody that knows what they're doing are looking for some kind of way to dig in and get some productive leverage in a bad situation.

 

[Regular Guy]

A new post in the JCK industry rag seems to help bring current light some issues with respect to the Kimbery Proccess, here:

http://www.jckonline.com/2010/07/16/wil ... -kimberley

including this text:

"Yet even activists acknowledge that kicking Zimbabwe out of the KP is “not ideal,” as Elly Harrowell of NGO Global Witness put it, because having a large producer outside the system could undermine the KP’s credibility."