Engineering & Mining Journal

SEP 2017

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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Page 61 of 99

DIAMOND MINING 60 E&MJ • SEPTEMBER 2017 in 2016 may again lead to swollen midstream inventories if re- tail demand does not strengthen proportionately." Were these fears realized? According to De Beers in a report published in June, global demand for diamond jewelry increased marginally last year to reach a total of $80 billion, with the U.S. alone accounting for $41 billion of this. Elsewhere in the world, the Japanese and Chinese markets also showed growth, while jewelry demand in India and the Middle East was weaker. Commenting on these data De Beers' CEO, Bruce Cleaver said "while U.S. demand drove global growth in 2016, it is in- creasing demand from emerging markets that is behind the last five years being the strongest on record. Despite some markets facing challenging conditions last year, we see this trend con- tinuing, with improvements in demand from China and India, in particular, emerging in 2017." Conflict Diamonds: Still a Challenge As E&MJ noted in its 2011 article, established in 2003, the Kimberly Process (KP) "relies on a system of cross-referencing production, exports, and imports of rough diamonds between pro- ducer and consumer countries. The aim is to make it more diffi- cult for illegally mined or smuggled diamonds to be sold to help finance civil conflicts." The article went on to highlight some of the weaknesses that have been perceived in the way that the KP operates, in particular its inability to police areas where diamond production takes place under conflict or corrupt conditions. Consisting of 54 participating countries and organizations, the KP claims that 99.8% of world diamond production now comes from conflict-free sources. Without question, it has made major inroads into this source of income for the participants in (usually) civil wars, but has it now been able to achieve the level of credibility that it needs to win public confidence? That corruption can ease the way for diamonds to be award- ed fraudulent KP certification is one allegation frequently made by its critics. An article in the U.K. newspaper, The Guard- ian, in 2014 summarized other concerns. "The process has two main flaws," said author David Rhode. "First, its narrow terms of certification focus solely on the mining and distri- bution of conflict diamonds, meaning that broader issues are not addressed. "Second, a KP certificate does not apply to an individual stone but to a batch of rough diamonds, which are then cut and shipped around the world. Without a tracking system, this is where the trail ends," he added. The star piece in this year's Argyle Pink Diamonds Tender, 'The Argyle Ever- glow' is a 2.11-ct polished radiant-cut red diamond. According to Rio Tinto, there have been fewer than 20 ct of Fancy Red certified diamonds sold in the 33-year history of the annual sales tender. The closing date for bids this year is in October.

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