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World Diamond Industry: Namibia

Namibia is a Southern African nation with rich diamond reserves. Their production comes mostly from marine sources: diamonds that have been deposited on the ocean floor as a result of river movements and ancient tidal basin flows. There are also a few small, land-based mining operations. Marine mining is a difficult, costly, and highly mechanized process. De Beers is the main producer of diamonds in Namibia, having invested heavily in marine mining equipment and exploration vessels over the years. The limited artisanal mining in the country means the government has strong controls over production levels.

Namdeb, a 50:50 joint venture between De Beers and the government of Namibia, is responsible for diamond mining activities in the country. The company employs approximately 1,600 people, and has contributed more to the national Gross Domestic Product (GDP) than all other mining activities combined. According to Kimberley Process statistics, Namibia produced $914 million worth of rough diamonds last year. Diamond production accounts for approximately 10% of GDP, 40% of export revenue, and 7% of annual government revenue.

In mid-2016, De Beers and the government of Namibia announced a landmark 10-year agreement on diamond beneficiation, the longest agreement since the partnership was formed in 1994. Under the new deal, Namdeb will make 15% of its run-of-mine production available to a government-owned, independent sales company called Namib Desert Diamonds Pty Ltd. Namib will offer its diamonds to 11 local manufacturers polishing in the country. Each company is allocated up to $15 million worth of rough diamonds annually. Because of their alluvial source, Namibian diamonds have amongst the highest average value anywhere in the world. This means that local cutters have an advantage over manufacturers in other countries, such as South Africa, where only large, high-value diamonds can be cut profitably due to the country's relatively higher wages.

However, the touted benefits of these efforts have yet to materialize. In some cases, local cutters are choosing to forgo their local supply, or buy and sell to the secondary market, which means that many Namibian diamonds are not being cut locally. Despite warnings by the government to curb the practice, and cut off supply such companies, it remains common. Estimates suggest that as few as three to five companies still polish diamonds in Namibia.

Another major part of the deal imposed tough terms on De Beers. Local cutters successfully lobbied to get access to large 'special' diamonds, rough diamonds weighing 10.80 carats or more. These diamonds are the most valuable in any rough production, but in the case of the high-value Namibian goods, are amongst the most valuable rough diamonds in the world. The government complied, and now obligates De Beers to supply all of its locally-mined +10.80 carat diamonds for local polishing – and beneficiation.

The mechanism used to establish the purchase price of these diamonds means that De Beers sets the price based on their expectation of the polished outcome of the rough stone. Since they have vastly more experience in pricing these special diamonds than the local cutters, the prices are set so high that profit can only be achieved by maximizing all possible yields in the finished diamonds. Under normal circumstances, these special stones would be cut by some of the most skilled diamond cutters in the world, typically located in the traditional diamond centers of New York, Israel, and Belgium. In these centers, there are master cutters who have decades of cutting experience, and access to the best technology in the industry. The cutters in Namibia simply lack the expertise and technology to cut these stones profitably. So despite the best efforts of the … 

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World Diamond Industry: Canada

In a massive and resource-rich country like Canada, diamonds are a relatively small component of overall natural resource exports. Canada is a major exporter of gold, nickel, uranium, forestry products, and perhaps surprisingly, possesses the world's second largest reserves of oil in the western part of the country. In 2015, Canada exported $231 billion in natural resources. Diamond exports were $2.4 billion, just one percent of resource exports. However, diamonds have been located in some of the most northern and often inhospitable locations in this vast country. So while the impact of diamonds on the economy as a whole has been relatively small, they have been critical to the sustainable development of many northern settlements. These small towns and villages suffer from harsh weather and a lack of employment opportunities, so diamonds have been instrumental in their success in the last 15 years.

Diamonds were first discovered in Canada in 1991, in an area that few people believed could possess kimberlite intrusions. The Ekati mine, which is still in operation today, began mining in 1998. The following year, a massive gold mine called the 'Giant mine' closed after more than fifty years of mining. This was a major blow to the mining-heavy economy of the region, and diamond mining helped save the capital city of Yellowknife, in the Northwest Territories. In Canada, roughly 87 percent of the population of 36 million people live and work within 160 km of the US border. That makes Yellowknife, located about 2,000 km north of the US border, very remote, to say the least. The Northwest Territories, where much of the diamond activity in Canada is centered, has a population of just 44,000 people in an area of 1.34 million square kilometers. Diamonds have been a major source of employment and tax revenues for this area, which are desperate to benefit from their resource base.

Canada's attempts to develop its own cutting and polishing industry have had mixed, but mostly disappointing, results. In Canada, the provincial or territorial governments have much autonomy to establish the laws and guidelines within their jurisdiction. This had led to different rules within the three different provinces currently mining diamonds, and has created competing interests for the downstream diamond manufacturers in the country. However, in two of the three provinces where diamond mining takes place, the local governments mandate that mining companies sell up to 10 percent of the mined diamonds by value to local manufacturing companies, assuming that such demand actually exists. In reality, the demand has been far less than 10 percent, and the local cutting industry has not really gotten off the ground in more than 15 years.

In the early days of diamonds in Canada, many companies rushed to take advantage of the opportunity. In Yellowknife, a small compound was developed, and aptly named 'Diamond Row,' a stretch of buildings located next to the city's airport. Some big players entered the area with much promise, including Tiffany & Co.'s rough diamond polishing company Laurelton. However, it soon became evident that proximity to the diamonds was not a sustainable competitive advantage. In Northern Canada, the remote location makes the delivery of most products and services very expensive. This means that the cost of just about everything, including wages, is very high, making everything from the cost of building a factory to day-to-day operations high-cost and non-competitive.

For many years, local and federal governments were willing to subsidize factories that were losing money in order to keep the industry alive. However, this proved unsustainable, and many factories closed immediately after subsidies were revoked. This included many high profile manufacturers such as Tiffany and Arslanian… 

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Did Anyone Say Diamond Dinner?

The world's most expensive meal will set you back $2 million, but will send you home with some beautiful diamonds as a parting gift. Ce La Vi restaurant, in Marina Bay Sands tower in Singapore, is the home of a $2 million luxury dining experience. The meal features an 18-course degustation menu that includes caviar, oysters and pigeon, paired with a range of expensive wines and champagnes. The lucky couple will bring home a gorgeous set of gold chopsticks, featuring 4 carats of round diamonds, as well as a 2 carat blue diamond ring set in rose gold, known as "the Jane Seymour" 

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The Most Creative (and Outrageous) Products Made with Diamonds - Diamond Coffee Cup

 Where can you find a diamond coffe mug and who made it?

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Diamond Manicure The Most Creative (and Outrageous) Products Made with Diamonds - Manicure

How much do you believe costs a diamond manicure? 

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