Issue 4.6, June 2013

Issue 3.1, H1 2012
The Bourse
THE BOURSE
Issue 4.6, June 2013
Dear Reader,
Ramadan Kareem! Diamond trade activity in Dubai continues to grow and demonstrate how well established this
centre has become within the industry. Whilst we have not yet received data from Dubai Customs on polished
diamond trade, there has been a significant surge in activity witnessed at DDE. Dubai has its target firmly set on
continuing to lead in the diamond sector and now may be the ideal time for polished traders to increase their
participation in the market. The Emirate can serve as a soft landing for traders looking to diversify at least some of
their business with a view to grow and develop this emerging market. We look forward to reporting statistics on Dubai’s
polished trade as soon as they are available.
Sincerely,
Franco Bosoni
Director, DMCC Commodity Services
Dubai Rough Trade May 2013
A total of 32.4 million carats were imported in the
first half of the year at a value of US$ 2.5 billion,
while export was at 33.6 million carats with a
value of US$ 3.7 billion. The months of June to
August are expected to be slow months of trade
because of the Holy month of Ramadan and the
huge outflux of traders for their summer
vacations.
World diamond production
In terms of geographical diversification of the
resources, the diamond industry is highly
concentrated in a few locations, with about 70%
of the world’s diamonds located in Africa and
Russia.
According to the Bain global diamond industry
portrait of growth report; in 2011 the supply of
rough diamonds contracted by 3% to 124 million
carats from 128 million carats in 2010. The fall in
production levels was as a result of technical
difficulties experienced by De Beers and Rio
Tinto in some of their mines while production
levels remained stagnant in ALROSA.
Dubai's Rough Trade of Diamonds (Carats) - H1 2013
14
12
Million (Carats)
In the first half of the year, the trade volume of
rough diamonds increased by 10% to 66 million
carats, and the value increased by 5% to US$
6.2 billion in comparison to the same period last
year.
10
8
Import (Cts)
6
Export (Cts)
4
Total Trade
(Carats)
2
0
Source: Kimberley Process, Dubai
Issue 4.6, June 2013
The Bourse
Endiama’s Vision for the Angolan
Diamond Centenary Conference
Carlos Sumbula, Chairman, Endiama said,
"The conference aims to highlight the
accomplishments of Angola in the diamond
industry. At the same time it will emphasise
the potential of Angola's territory. The
infrastructure investments made by the
Angola government enabled a substantial
reduction in operational costs of the mining
production chain value. It will state the new
Mining Law incentives for investors such as
the reduction of tax burden on mining
companies from 35% to 25%. At this
Centenary Conference investors will be
able to explore the dynamics and
opportunities for the next decades of
Angola's diamond business."
Angolan Diamond Centenary
Conference 2013
Endiama, the state owned company responsible for the
exploration, research, mining, polishing, cutting and
trading of Angolan diamonds, welcomed participants
from the diamond supply chain for the 2013 Diamond
Centenary Conference.
The capacity filled conference (800 attendees) had in
attendance the Ministers of Mines of South Africa and
Namibia, Susan Shabangu and Isak Katali respectively;
the Kimberley Process Chair, Ambassador Welile
Nhlapo; the President of the World Diamond Council
(WDC), Eli Izhakoff; the President of Alrosa, Fyodor
Andreev; the Executive Chairman of the Dubai Multi
Commodities Centre (DMCC), Ahmed Bin Sulayem;
Angola's Minister of Geology and Mines Hon. Prof. Dr.
Francisco Queiroz, Eng. Carlos Sumbula, Chairman of
Endiama and many more.
“The fact we are all here today – members of
governments, industry and civil society – celebrating
a milestone in the life of this great African mining
centre, says it all” – Eli Izhakoff
He stressed that participants in the diamond industry
need to be “Diamonds guardians” and it is our
responsibility to ensure the diamond community is
protected from all illegalities. “For the people of Africa to
obtain full benefit from their natural resources it is
imperative that the diamond industry remains devoid of
any reputational threat....This is why, both developed and
developing countries should not link the diamond industry
with violence.”
Ahmed Bin Sulayem, Executive Chairman of the DMCC
further commented: “President dos Santos’ open
economic policy is already a model for African growth and
prosperity for its people. As a logistical hub we look
forward to an even stronger cooperation between the
UAE and Angola in the next years to come.”
Dubai and Angola’s trade has fostered over the years,
with diamonds constantly ranked as the top traded
commodity. In the KP’s 2011 annual report, 42% of
Angola’s exports (in value) of diamonds were exported to
Dubai. Over the last 10 years Dubai’s import from Angola
has experienced a 42% CAGR in volume. In 2012, Dubai
imported 5.1 million carats at a value of US$ 651 million.
Dubai's Imports of Rough Diamonds from Angola (Carats )
6,000,000
Eli Izhakoff recognised the achievement of Angola and
the role it plays in the diamond community. He kicked off
his speech by saying Angola is a “living example of the
promise of rebirth and a centre that offers the most
tangible proof of what the Kimberly Process is able to
achieve.”
"Angola was one of the first countries involved in the
establishment of the KPCS and its continuous support is
essential for the credibility of our unique supply control
mechanism, probably the best in the whole commodities
world."
Angola is beginning to retain its position of authority and
influence in central Africa, so as the other neighbouring
countries – Botswana, Namibia Lesotho and Zimbabwe.
2
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
"Centenary celebrations symbolise that the diamond
industry is not about a zero-sum game of winners and
losers, but about shared responsibilities and mutual
benefit.", said Stéphane Fischler, President of the
Antwerp World Diamond Centre, in his address at the
Centenary Diamond Conference, in Luanda, Angola.
2012
Issue 4.6, June 2013
The Bourse
Angola plans manufacturing
polishing centre
“”
and
The government of Angola has committed
to continue to develop the minerals sector
until 2025. The government has also said it
will work on diversifying the diamond sector
into different paths of the supply chain such
as manufacturing and polishing.
According to Manuel Domingos Vicente, the
Vice President of Angola, “Among our
objectives for the diamond sector are to
bring added value to mining, contribute to
the diversification of our national economy
and to sustainable development of Angola.”
Endiama and Alrosa Joint Venture
Over the last 20 years ALROSA and Endiama have
enjoyed a strong relationship and have worked together
to develop the Catoca diamond mine. On the first day of
the centenary conference, ALROSA and Endiama signed
an agreement to start a joint venture that will prospect
and explore diamond deposits in Angola. The joint
venture document was signed by Endiama President
Antonio Carlos Sumbula and Alrosa President Fyodor
Andreev.
“Alrosa has been a strategic partner of Endiama for
many years," said Andreev. "Cooperation between
Alrosa and Endiama is a successful 20-year story of
development of the Catoca diamond mine which
accounts for 6 % of world diamond production.”
"In addition to the success of existing operations we see
further potential for our mutual cooperation in the years
to come. We believe that huge geological upside is
possible in Angola and the probability of new findings is
high. Geological exploration in Angola is the part of
ALROSA's long-term growth strategy."
Angola's candidacy to become Vice Chair of the
Kimberley Process
At the celebration conference of the discovery of
diamonds in Angola, Vice-President Eng. Manuel
Domingos Vicente announced the Republic of Angola's
willingness to take up the position of Vice-Chair of the
KPCS in 2014.
The decision will be taken during the next KPCS Plenary
in Johannesburg in December 2013 under the
Chairmanship of South Africa. The Chair of the KPCS in
2014 will be in the hands of the People's Republic of
China and Angola is willing to take over this position
afterwards.
Since the start of the KPCS, Angola has been a strong
3
supporter of the Kimberley Process. It also chairs the
important
important position of the Working Group of Artisanal and
Alluvial Producers (WGAAP).
Ambassador Nhlapo, the KP Chair said: "The assurances
given by President dos Santos are the best possible
witness of Angola's strong commitment to the KPCS."
Rui Mangueira, Minister of Justice and Human Rights of
Angola further announced that the Government of Angola
is very determined to eradicate any violation of human
rights which directly links to the production of diamonds.
The eviction of illegal workers coming to search
diamonds on Angolan territory is a delicate exercise but
can and will in no way compromise our living up to the
high standards on the compliance with fundamental
human rights.
Other highlights
Peter Meeus, Chairman of the Dubai Diamond Exchange
and one of the pioneers of the KPCS in his speech
highlighted: “Anno 2013 diamonds are the best-controlled
commodity in the world. The diamond industry doesn’t
need to take lessons from any other business. More than
99.5% of the diamonds produced in the world fall under a
certification regime.”
Raffi Arslanian, CEO of Arslanian Freres and main
sponsor of the Conference congratulated Angola on their
achiievement: “25 years down the road, Angola has
definitely put its mark on the international diamond map.
Over the years, the country has managed to grow into the
5th largest diamond producer in terms of value, to exploit
the 4th largest kimberlite in the world and to achieve a
stable and prosperous diamond-mining environment.
Maybe more importantly, the country has managed to
keep a firm control of its national diamond resources,
showing the way for other African countries to steer an
independent course for this valuable commodity. Last but
not least, Angola has become one of the influential voices
in major diamond organisations – for instance in the
Kimberley Process- and has gained significant stature on
the international diamond scene.”
Issue 4.6, June 2013
The Bourse
100 years of diamonds – Angola
Snapshots of the Conference
“Today with its 8.3 million carats diamond production
valued US$ 1.1 billion, Angola contributes roughly 7%
of world rough production. Artisanal diamond mining,
which is primarily small scale mining of diamonds, is a
great success story in Angola and the world has many
things to learn on this count,” said Anup Zaveri, The
Gem & Jewellery Export Promotion Council, India.
Angola is ranked as one the top 5 quality diamond
producers in the world. The country’s‫ ‏‬diamond reserves
are generally considered to be extensive, marketable
and are of good quality. Approximately 70% of the
diamonds in Angola are classified as gem quality, 20%
as near gem quality and only 10% as industrial. Angola
has explored only 40% of the diamond blessed territory,
leaving a huge for growth in exploration in provinces
like Bié, Malanje and Uíge. Source: Reuters.com
The first diamonds in Angola were found in 1913 in the
Lunda Norte province bordering Zaire. Prior to the end
of the Angolan civil war in 1975, Diamang had sole
concession and rights for diamond mining and
prospecting. In April 1979, the government passed a
law (Law 5/79) which gave the state the full right to
explore and develop minerals and this lead to the birth
of the national diamond mining company, Endiama Emprêsa Nacional de Diamantes in 1981. Endiama
bought 77% share in Diamang, while 23% was bought
by other private companies. Source: Mongabay.com and
Above - Carlos Sumbula, Chairman, Endiama with guests at the
Conference
Below – Guests enjoying the Conference
American.edu.
Calendar of Events – July-Sept, 2013
July
14 – 18
DDE Rough Tender:
August
KP Times
The next issue of the UAE Kimberley Process (KP)
Times, a quarterly newsletter aimed at creating further
dialogue between the UAE KP Office and its clients, is
now available on the website on
http://www.dmcc.ae/jltauthority/diamond/uaekimberley-process/uae-kimberley-newsletters/
GIA course – Diamond Grading Lab:
DDE Rough Tender:
GIA talk - Fancy Shape Diamonds
18 – 29
25 – 29
26
September
IGI course – Professional Jewellery Design
DDE Coffee Club:
DDE Rough Tender:
8 – 3 Oct
25
29 – 3 Oct
4
Almas Tower Level 2, Jumeirah Lakes Towers
PO Box: 48800 Dubai U.A.E
T. +971 4 433 67 11
F. +971 4 375 18 96
[email protected]
The Bourse
Issue 3.1, H1 2012