Diamond history and traditions
Diamonds have a long history as beautiful objects of desire.
In the 1st century AD, the Roman naturalist Pliny the Elder stated:
“The diamond is the most precious, not only of precious stones, but of all things in this world”.
The world’s love of diamonds began in India, where diamonds were collected from the country’s rivers and streams. Some historians estimate that India was trading in diamonds as early as the 4th century BC.
The country’s resources have produced limited quantities for an equally limited market, namely the very wealthy classes of India. Gradually, however, this has changed. Indian diamonds, along with other exotic wares, found their way into Western Europe via caravans traveling to the medieval markets of Venice. In the 1400s, diamonds were becoming fashionable accessories for the European elite and beyond.
In the early 1700s, when India’s diamond supplies began to dwindle, Brazil emerged as an important source.
Diamonds were discovered in the pots of gold diggers as they sifted the gravels of local rivers. Once it reached its full potential, Brazil dominated the diamond market for over 150 years. Although the sources have changed, the diamond market has experienced its evolution. But at the end of the 1700s the old ruling classes, the major consumers of diamonds, were in decline and the political upheavals that involved Europe in those years, such as the French Revolution, led to changes in the distribution of wealth.
The 1800s brought growing wealth to Western Europe and the United States. The explorers unearthed the first large South African diamond deposits in the late 1800s just as the demand for diamonds spread very quickly from all over the world and without any decline.
The history of the modern diamond market really begins on the African continent, with the discovery of diamonds in 1866 in Kimberley, South Africa. The entrepreneur Cecil Rhodes 22 years later or in 1888 he founded De Beers Consolidated Mines Limited. By 1900, De Beers, through its mines in South Africa, controlled about 90% of the world’s rough diamond production.
South African sources have affected many segments of the diamond industry. This was especially true when diamond mining moved from the surface to the farthest underground. Due to the enormous costs and relatively low yields involved, new sources have forced the development of more efficient extraction techniques. They created the need for better marketing. They also necessitated an improvement in cutting and polishing. All these advances that have increased efficiency, reduced costs and improved the appearance of the finished stones.
In 1870, the annual production of rough diamonds was well below one million carats.
In the 1920s the figure was around three million carats. Fifty years later, annual production approached 50 million carats to exceed 100 million carats per year in the 1990s.
In the late 1970s, the world’s leading producers of rough diamonds were South Africa, Zaire (now renamed the Democratic Republic of Congo) and the former Soviet Union. In the 1980s, production of higher quality diamonds from Russia and South Africa remained relatively constant, but Zaire’s production of lower quality diamonds more than doubled.
In 1982, a new highly productive mine in Botswana was added to world production.
A prolific source of high-quality diamonds, the Jwaneng mine has increased Botswana’s production so much that the country has risen to third place in the world for total diamond mining and second for diamond value. De Beers entered into a contract with the Botswana government to purchase the mine’s production and Botswana decided to build its own diamond cutting industry.
World diamond mining has expanded dramatically with the discovery of sources in Australia in 1985 and major new deposits in northern Canada in 2000.
The market probably changed as much after 1990 as in the years following the discovery of diamonds in
1866 in South Africa and the establishment of De Beers. The 90s brought new onesexciting sources and encouraged the dramatic growth of some cutting centers. All of this was happening as the world economy rocked wildly. As a major player in the trade, De Beers also had to change. The De Beers of today bears little resemblance to the De Beers of 1989. The company has greatly reduced its role as a monopoly custodian of the diamond supply. Instead of flowing into the market in a one-channel path from De Beers, diamonds now flow into the market through multiple channels. Not everything has changed, however. Regardless of which route they take, diamonds continue to flow from mines through cutting centers and ultimately to retail customers.
The brilliance of the diamond has been prized for centuries, but there was not much scientific knowledge about it before the twentieth century. Since then, the knowledge of diamonds has grown steadily, with the research of chemists, physicists, geologists, mineralogists and oceanographers. In the last 50 years alone, scientists have learned a lot about how diamonds are formed and how they are transported to the earth’s surface. This knowledge made it easier to predict locations for new diamond discoveries.
Where are diamonds found? Spotlight on Botswana diamonds
Botswana is currently the second largest diamond producer in the world. Some of the largest diamonds in the world have been extracted from these mines. Diamonds represent the lifeblood of the African state’s economy, helping to build infrastructure, supporting the development of women and the fight against AIDS.
Botswana was ruled by the British Empire from 1885 to 1966. Considered a stagnant place with no natural resources, it was largely ignored by the British Empire. In 1966 it was one of the poorest countries in the world, with a per capita income of around $ 80 per year.
The D-color Graff Lesedi La Rona weighs 302.37 carats and is currently the largest square emerald cut diamond in the world. The original rough, weighing 1,109 carats, is currently the fourth largest diamond and the second largest gem quality diamond ever found. It was found in the Karowe mine in Botswana in 2015.
The discovery of diamond deposits changed the situation. In 1967, just a year after Botswana’s independence, De Beers discovered a huge diamond strand of kimberlite in Orapa, a remote region about 400 miles from the capital Gaborone. This kimberlite piperline is the second largest diamond producer in the world. Four years later, the Orapa diamond mine opened for production and became the largest diamond mine in the world in size. De Beers and Botswana quickly formed a 50% joint venture, becoming Debswana, a huge global diamond powerhouse that includes a state-of-the-art $ 35 million diamond sorting, valuation and sales center called DTC Botswana. This is the largest facility of its kind in the world and has the capacity to prepare nearly 45 million carats of rough annually for the market, or approximately 40% of the total annual diamond supply. Debswana owns 4 mines – Orapa, Letlhakane, Jawaneng and Damtshaa – which produced 24% of the world’s diamonds by value in 2018, making it one of the world’s largest diamond producers. Debswana is also the second largest employer in the country after the government. Its Jwaneng mine, nicknamed the “Prince of Mines”, is the richest diamond mine in the world, produces the most diamonds in terms of value, and is a notable mine in diamond history. The government of Botswana owns about 15% of De Beers, which gives it a huge say in how to collect and use the proceeds of diamonds.
Thanks to Botswana government negotiations, much of Debswana’s generated income goes into the government coffers, and this income helps build schools and roads and bring water to homes and farms.
Just off Airport Road The Debswana complex in Gaborone which includes DTC Botswana.
All De Beers mining production from South Africa, Namibia, Botswana and Canada is consolidated at DTC Botswana, in a pre-sale sorting and evaluation process known as aggregation. While De Beers has fifty-five joint partnerships with governments from other African countries such as Namibia and South Africa, Botswana is by far its largest and richest source of diamonds today. Through agreements with Botswana, the vast majority of diamonds are purchased by De Beers for sale to the company’s “sightholders”,although De Beers was traditionally the only customer.
In 2006 there was the renewal of the mining lease for Jwaneng and it established that starting from 2013, 10-15% of the production must be sold to the Okavango Diamond Company (ODC) owned by the government of Botswana. This agreement offers the government its own channel of direct sales of rough diamonds to customers around the world, bypassing the De Beers channel. Perhaps more importantly, a new 10-year sales contract, signed in 2011, included provisions for the transfer of DTC, De Beers’ sales arm, from London to Gaborone. The aggregation of diamonds at DTC Botswana precedes each of the so-called attractions, where select buyers from around the world gather to purchase rough lots. The attractions, held in London for nearly a century, moved to Gaborone following intense mining lease renegotiations with the Botswana government in 2004-2005 (Mokone et al., 2013). The move signals a historic change and a significant upheaval in De Beers’ traditional business model, eliminating a remnant of the company’s control over diamond sales since colonial times in South Africa. As a result, more than 60% of London-based staff moved to Botswana in 2013 at a cost of over $ 120 million. Botswana has always pushed for the construction and creation of a national diamond manufacturing, cutting and polishing industry and it remained an elusive target until recently. Neighboring South Africa benefited from a well established diamond cutting industry employing several thousand workers. Even so, much of this industry survived because De Beers subsidized local cutting operations by providing roughly a 10% discount (effectively saving buyers from export taxes). Some of these operations existed primarily as a means for their owners to obtain rough allocations from De Beers. They performed minimal work on the stones at local factories before exporting them to Israel, Antwerp or India for actual production due to low production costs. Diamond production costs in Botswana range from just under $ 40 to $ 60 per carat, depending on the efficiency and technological capabilities of a given operation. These costs include labor, utilities, maintenance and technology support, and transportation. This cost range is much lower than that of Canada ($ 80 per carat) but still more than double that of China ($ 17 per carat) and four to six times that of India ($ 10 per carat), which polishes 92% of world production. Beyond the high labor costs, significant challenges remain to sustain a diamond processing industry. The infrastructure is still lacking. Power outages are common, internet service remains slow, and importing or repairing equipment is still very expensive and inefficient.
The year 2027 is the government’s benchmark for the development of a diamond polishing industry that does not depend solely on internal crude, the Jwaneng mine is expected to be converted into an underground mine in the same year, which will drastically reduce production. . In comparison, Australia’s Argyle mine has gone from a maximum annual production of 42 million carats as an open pit mine to 20 million carats as an underground mine. Production will likely continue 30 to 40 years beyond this date, but with much lower volumes and higher costs.
Both the government of Botswana and the diamond community expect the Okavango Diamond Company’s rough auctions to spur production and help build the country’s trading base. Okavango is a government- affiliated company that has begun selling between 12% and 15% of the country’s diamond production through monthly auction sales. Existing diamond producers say the offers will reduce costs and provide greater access to supplies and attract small diamond companies and wholesalers to set up businesses in the country. Okavango’s sales have much lower purchase requirements than De Beers’, plus a fairly straightforward application process that will allow those companies to participate. It remains to be seen whether Botswana-branded cut diamonds will grab the attention of consumers globally. Buyers are increasingly aware of the products they buy and the supply chain involved. The texture of a Botswana brand is undoubtedly strong. Consumers, who have been attracted to African diamonds for over a century, may find confidence in knowing that the diamonds they buy today have contributed to the transfer of skills in Africa, the reduction of poverty and the dignity of work for the people of Botswana.
A diamond is history and desire even before reaching the
jeweler’s window. It forms deep in the earth under
extreme heat and pressure. It is violently ejected
upwards until it reaches the earth’s surface. He is forced
to leave his hiding place by nature or man. It is then split,
cut and polished until the natural beauty of him shines through.