The world’s largest rough diamond producer by value will now sell its own polished diamonds in auctions. (Image courtesy of De Beers Group)
Anglo American’s De Beers, the world’s largest rough diamond producer by value, has decided to begin selling its own polished diamonds in auctions for the first time in its history.
The pilot auction, scheduled for June, will include a wide range of polished stones manufactured directly from the company’s own rough diamonds.
The pilot auction, scheduled for June 29, will include a wide range of polished stones manufactured directly from De Beer’s own rough diamonds.All the polished rocks will carry grading reports from both the International Institute of Diamond Grading & Research (IIDGR) — De Beers’ in-house grading unit — and the Gemological Institute of America (GIA).
“We are interested in testing the level of demand from polished buyers for diamonds that have a clear and attractive source of origin, and that offer the assurance of product integrity that dual certification provides,” Neil Ventura, the miner’s executive vice president of auction sales, said in the statement.
If successful, the process would provide De Beers with more insight into the polished market, while also helping consumers fill gaps in supply or inventory if they were unable to find goods at the company’s rough auctions, he added.
All registered De Beers auction buyers will be eligible to bid in the first sale, which takes place on June 29.
Cutting and polishing the 813-carat stone could result in one of the world’s largest flawless diamonds
This is the 813-carat rough diamond that sold for $63 million. (Image courtesy of Lucara Diamond)
The world’s most expensive rough diamond is now in the hands of De Grisogono, a Swiss luxury jeweller and watch maker.
Geneva-based De Grisogono purchased the rights to market Lucara Diamond’s (TSX:LUC) Constellation gem, which sold in May for a record $63 million, at the launch of the 28th Biennale des Antiquaires in Paris. The price was not disclosed.
The company entered into an agreement with Nemesis International when the Dubai-based corporation bought the 813-carat stone from Lucara, which recovered it last November from its Karowe mine in Botswana.
“I love her and I hate her. Love because something like this is so exceptional – I could never dream to be able to have a stone like this in my own hands – and hate her because I don’t know how I’m going to dress her.”
According to De Grisogono, cutting and polishing the Constellation – a process expected to take several months – could result in one of the world’s largest flawless diamonds. The impressive rock weighs 813 carats and measures six centimetres (2.4 inches) across. According to Nickolas Polak, international director of Nemesis, the diamond will be cut in Antwerp and is expected to produce the world’s largest D Flawless diamond, weighing between 300 carats and 350 carats, reported the fashion website WWD.
“(This is) the first time we’ve taken such a historic stone and had full creative freedom to do what we want with it,” CNN quotes De Grisogono CEO John Leitao, who added that the firm plans to transform Constellation into “a stone that rivals the crown jewels.” The company’s founder was even more colourful in his comments: “I love her and I hate her,” said Fawaz Gruosi. “Love because something like this is so exceptional – I could never dream to be able to have a stone like this in my own hands – and hate her because I don’t know how I’m going to dress her.”
Lucara made headlines with an even bigger diamond also dug from Karowe, the 1,109-carat “Lesedi La Rona” (or “our light” in the Tswana language spoken in Botswana). However that stone, which was expected to fetch $70 million, failed to sell at auction and Lucara is still searching for a buyer.
De Grisogono also purchased the rights to market a 404-carat rough diamond from Nemesis International in May. According to Rapaport News, that stone was recovered by Lucapa Diamond Company (ASX:LOM) at its Lulo mine in Angola.
Three days ago Lucapa dug a 38.6-carat pink diamond, also from Lulo. The coloured stone is the largest “fancy” pink diamond recovered to date from the mine. The Australian company reportedly sold it last week as part of a parcel of other rocks for a total of $5.8 million.
De Beers is fine-tuning details of a set of new conditions for companies seeking to join its group of customers known as “sightholders.”
According to FT.com (subs. required), the diamond giant — which sells $6 billion of unpolished gems a year and is the world’s largest supplier by value — wants traders to hold a specified proportion of equity in their businesses, so they are less reliant on bank borrowing.
De Beers, which last revised its sightholder contracts in 2011, will give companies time to make changes to their accounting practices. But sightholders unwilling or unable to do so will lose their status.
The move seeks to direct gems to the most financially sound purchasers and make the business more transparent, echoing other signs that the diamond industry is starting to modernize.
The introduction of online trading, where dealers can buy and sell parcels of gems worth millions online, is providing real-time pricing data, and represents a challenge to the old, more secretive ways of doing business, while banks that lend to the industry are demanding a more corporate approach from diamond traders and manufacturers.
Anglo American (LON:AAL) bought Oppenheimer family’s 40% ownership in De Beers for $5.1 billion in 2012, increasing its stake to 85% and ending the dynasty’s 80-year ownership. Botswana controls the rest of the business, founded by the British imperialist Cecil Rhodes
An Antwerp diamond firm has gone bankrupt owing payments to banks and other creditors of $26 million marking the largest single default in the year. The firm’s owner reportedly disappeared last week, citing losses.
The case follows one last month when a trader from Surat defaulted on rough diamond payments to at least six Indian traders in Antwerp. He had purchased rough diamonds on 120-day credit terms and was unable to make the payment due to the declining rupee, a leading paper reported. Industry sources claim that the diamond firm trades rough and polished diamonds on Hoveniersstraat in Antwerp. The Indian traders are taking a hit since they are having to find extra rupees to make up for its fall against the dollar. On the other hand, they are having to buy rough at high prices and finding that polished prices are either static or declining.