Zimbabwe diamonds throw world market out of balance

Barely a month after being admitted back to the Kimberley Process Certification Scheme, diamonds from Zimbabwe have already thrown the market “out of balance”. And even the world’s biggest diamond trader De Beers is taking notice.

The company’s chief Executive Officer, Philippe Mellier, told Rapaport News that there would be competition from Zimbabwe but he did not believe this would have a material impact on the market largely because of the lower quality of diamonds from Zimbabwe. But he added: “I think we can compete quite nicely”.

The KP lifted the ban on Zimbabwe diamonds in November last year after a three-year battle in which the country was accused of human rights violations.

African Diamond Producers, however, believed that Zimbabwe was being barred from selling its diamonds to protect the market, especially producers in Australia and Canada.

Rapaport, which does not trade in Zimbabwe diamonds and does not allow its clients to do so because mining companies in Marange are under United States sanctions, admitted that the market had been thrown off balance because of an oversupply of diamonds from Zimbabwe.

The mining companies in Marange have ramped up their production to about one million carats a month and are expected to produce 20 million carats this year.

Indian diamond companies have indicated that they can buy all the diamonds from Zimbabwe as they want to create some 250 000 jobs in their diamond processing centre in Surat.

China, which already runs Anjin, in Marange is also badly in need of diamonds for its bludgeoning middle class which is now larger than the entire United States population.

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