About Diamonds

Regarded for their exquisite beauty and the timeless qualities of love and devotion that they represent, diamonds have fascinated mankind throughout the centuries. The most precious and enduring of all gemstones, diamonds were formed billions of years ago, deep within the earth. Only a small number survive the journey to the earth’s surface; fewer still are of a quality that can be made into a precious piece of jewelry.
A diamond is earths ancient flair of purity

A long journey

Diamonds are beautiful, mysterious and rare. They survive an incredible journey to reach us, a journey that may have begun as long as 3.3 billion years ago. They are created when carbon is put under immense pressure and temperature deep within the earth—at distances of 250 miles or even greater.
One of nature’s most unique and dazzling gifts, diamonds come from two types of deposits. Primary deposits generally consist of diamond-bearing “pipes” of a volcanic rock called “kimberlite.” From deep in the earth these deposits were carried to the surface in molten rock, known as magma. Secondary deposits, also referred to as alluvial, were formed as a result of erosion of material from primary deposits and contain diamonds that have traveled some distance from their original source.
Even though world diamond production has tripled since 1980, diamonds remain a scarce resource. More than 12,000 kimberlite deposits have been found worldwide in the last 25 years, yet fewer than 1% have contained enough diamonds to make them economically viable. Geologists utilize many methods in diamond exploration, including satellite surveys, reconnaissance sampling and drilling in the ground. Some diamond producing countries include Botswana, Canada, Namibia, Russia, South Africa, Australia, and Tanzania.

Mining

Diamonds come from two types of deposits; each type requires special mining techniques. Primary deposits, in which diamonds are contained in kimberlite pipes, require open pit or underground mining operations. Secondary deposits are defined as diamonds that have traveled from their original location due to erosion. These require alluvial mining, which uncovers diamonds in riverbed, coastal and marine/undersea locations.

Regardless of the way diamonds are mined, enormous investment and technical skills are necessary to construct, maintain and operate a mine. In open pit and underground mines, the ore is crushed to uncover the diamonds.

Coastal mining involves the excavation of sand to find diamonds. Undersea mining entails drilling into the seabed to recover diamond-bearing gravels. Riverbed mining is often on an informal, smaller scale — also known as artisanal digging — and involves the most basic of equipment, such as sieves and pans, to find diamonds.

Over the years, there have been many amazing diamond discoveries. Some of the most famous finds include:

The Cullinan – Found in South Africa in 1905, it was the world’s largest gem-quality diamond, weighing 3,106 carats uncut. It holds this record even today.

The Tiffany – Discovered in the Kimberley Mine around 1877, this 287.42-carat diamond was turned into a 128.54-carat yellow cushion cut with 90 facets. It is the icon for Tiffany and Co.

The Golden Jubilee – Unearthed at the Cullinan mine in South Africa in1986, this 755.50-carat fancy yellow-brown diamond is now the largest cut diamond in the world, weighing 545.67 carats.

The Jonker Diamond – At the time of its discovery in 1934, this 726-carat diamond was the fourth largest gem-quality diamond ever found. In 1977, it was sold for a reported $2,259,400

Sorting, Cutting and Polishing

Once mined, rough diamonds are delivered to sorting experts who categorize and assign a value to them. It is here that industrial quality diamonds – which are small, lower quality stones – are identified.

These industrial diamonds are then used in equipment such as drill bits and lathes.

Those diamonds that are of gem quality are classified into thousands of categories based on size, shape, quality and color.

The majority of diamonds fall within a range of standard colors from colorless to faint yellow or brown tints.

Almost all rough diamonds have some distinguishing marks, known as inclusions, which make each one unique.

Some General Facts

The diamond industry consists of segments that mines, processes and markets gem diamonds and industrial diamonds.

Gem quality diamonds are mined primarily in Botswana, Russia, South Africa, Angola, Namibia, Australia, the Democratic Republic of the Congo and Central Africa.

It takes an average of 250 tons of mined ore to produce one carat of finished diamond.

the primary diamond processing centers, where they are evaluated, cut and sold are in Antwerp; India, Tel Aviv and New York.

Unlike precious metals such as gold or platinum, gem diamonds do not trade as a commodity: there is a substantial mark-up in the sale of diamonds, and there is not a very active market for resale of diamonds. One hallmark of the trade in gem-quality diamonds is its remarkable concentration: wholesale trade and diamond cutting is limited to a few locations.

92% of diamond pieces cut in 2003 were in Surat, Gujarat, India. Other important centers of diamond cutting and trading are Antwerp, London, New York, Tel Aviv, Amsterdam.

More than 50% of the world’s production of rough, polished and industrial diamond passes through Antwerp.

8 in 10 of all rough diamonds in the world are handled in Antwerp.

1 in 2 of all cut diamonds passes through Antwerp.

The Antwerp diamond sector has an annual turnover of 39 billion U.S. dollars.

The diamond trade is responsible for 8% of Belgian exports, and 12% of the Flemish region’s exports.

30.000 people are directly or indirectly employed by the Belgian diamond sector.

The figures speak for themselves. Antwerp has created an international commercial platform upon which producers, manufacturers and traders from all over the world can meet.

Antwerp is the world’s diamond capital but there are other large centers such as the Indian production hubs of Mumbai and Surat; Israel is a complementary trade centre, mainly supplying North America. Dubai is the regional distribution centre for the Middle East. New York is the primary port of entry into the United States, and the largest market for diamonds in the world..

AN ESTIMATED 5 MILLION PEOPLE HAVE ACCESS TO APPROPRIATE HEALTHCARE GLOBALLY THANKS TO REVENUES FROM DIAMONDS

Some more facts

Revenues from diamonds have enabled governments and health organizations to greatly improve existing public health services and provide new health services to those who have never had them before. Diamond revenues have funded more hospitals, more medical centers and more hospices, ensuring healthcare is extended to millions of people.
In 2000, governments, NGOs and the diamond industry recognized the need to put a process in place to prevent conflict diamonds – or what some call “blood diamonds” – from entering the legitimate diamond supply chain, therefore ensuring diamonds were not used to fund conflict. They agreed on a simple system called the ‘Kimberley Process.’ Under this system, rough diamonds are sealed in tamper-resistant containers and accompanied by forgery resistant, conflict free certificates with unique serial numbers each time they cross an international border. This was enshrined into national law in the participants’ countries in 2003. In 2004, the Chair of the Kimberley Process announced that considerably less than 1% of diamonds are conflict diamonds, reduced from approximately 4% before the establishment of the Kimberley Process. While this is an improvement, it is still not enough. The diamond industry will not rest until conflict diamonds are eradicated completely.

Decreasing the trade in conflict diamonds in a diamond-producing country minimizes the ability of rebels to fund violence. By allowing only legitimately sourced diamonds to be traded, revenues from these diamonds can then be used to benefit the people of that country. Today, more than 99% of diamonds traded internationally are from conflict free sources. Revenues from these legitimately sourced diamonds contribute significantly to the economies, healthcare systems, education and other infrastructure developments in some of the countries where they are found.

From the countries where they are sourced to the countries where they are polished and sold, diamonds are supporting millions of people globally. In the African country of Namibia, the diamond mining industry is the largest single employer after the government. In Botswana approximately 25% of the labor force is directly or indirectly linked to diamonds. In India approximately one million people are employed in the diamond industry. In 2002, approximately 15% of total employment in the Canadian Northwest Territories was related to diamond mine operation and construction.
Many African countries do not have sufficient tax revenues to pay for public education, unlike countries in many other parts of the world. Most African governments therefore need to charge students and their families for education. Botswana as an example, with the help of diamond revenues, is one of the exceptions.

When diamonds were discovered in Botswana in 1966, there were only three secondary schools; today, due to revenues from diamonds, there are more than 300.

Where children 40 years ago had no access to schooling or received lessons in the open air, they now have classrooms, sports equipment and books. Free schooling starts for children as young as six years old and continues throughout primary education. Even after the age of 13, secondary education is 95% funded by the government, enabling children to stay in school longer. The goal is to improve personal development and literacy rates that will pave the way for future generations.

The diamond industry has witnessed incredible growth in India in the last few years, lifting hundreds of thousands of people out of rural poverty into employment.
Today, 9 out of 10 diamonds are polished in India. The knowledge and expertise of the diamond industry’s highly skilled workforce has made India one of the key contributors to the growth of diamond jewelry worldwide. The diamond industry in India has also been a key contributor to the annual growth of the country’s gross domestic product (GDP)
As Nelson Mandela said in 1999, “The diamond industry is vital to the southern African economy.”

The majority of today’s diamonds are sourced from Africa, Canada, Russia, Australia and South America, with an estimated 65% of the world’s diamonds being produced in African countries. When measured by value, Botswana is the biggest producer of diamonds in the world.

The approximate breakdown of diamond production by value within Africa is:
Botswana: $3.3 billion
Angola: $1.5 billion
South Africa: $1.5 billion
Democratic Republic of Congo: $0.7 billion
Namibia: $0.9 billion
Other African nations: $0.6 billion

The revenues from diamonds sourced in Africa are benefiting the countries in which they are found. These benefits take the form of funding hospitals for the sick, schools for children and infrastructure, such as roads, telephones and clean water systems, for everyone. Additionally, diamonds from some African countries are helping to fund the fight against HIV/AIDS through counseling, testing, education, treatment programs, clinics and hospices.

In 2004, the Canadian Government, as chair of the Kimberley Process, cited that 99.8% of the world’s rough diamonds are certified to be from sources not involved in funding conflict.
The Kimberley Process requires that each time a rough diamond is traded, it is accompanied by a certificate with a legally binding guarantee that it is from a conflict free source. Participant countries or diamond traders that do not comply with the Kimberley Process are breaking the law.
As of November 2006, 71 countries were members of this system that ensures that conflict diamonds are ring-fenced and as such, unable to enter the diamond supply and be used to fund conflicts. When any concerns arise regarding a country’s adherence to the Kimberley Process, they are investigated and dealt with at an inter-governmental level.
The Diamond Development Initiative (DDI) aims to find sustainable methods of ensuring that diamonds are mined and distributed for the benefit of local communities and local governments. Unlike the more traditional, or formal, mines found in South Africa, Botswana and Namibia, small-scale informal alluvial diamond digging (also known as artisanal diamond digging) is usually undertaken by individuals, families or groups using very basic equipment to extract diamonds.
Most artisanal digging takes place around areas of alluvial deposits (deposits of sand, gravel and clay, which have been naturally transported by water erosion and deposited along either the banks of a river, the shoreline or on the bed of the ocean). There are a number of issues concerning the working conditions of small-scale informal diamond diggers. Among these are the unhealthy, unregulated and sometimes dangerous environments in which diggers work, together with the fact that the majority of diggers do not know the true value of rough diamonds and are therefore vulnerable to exploitation. In many cases the workers have no other option for employment and support a whole family on the substance wage given. The situation alluvial miners face today reflect the fundamental challenges of extreme poverty and a lack of basic infrastructure, education and healthcare in previously war-torn countries.
Founded through partnerships with governments, non-governmental organizations (NGOs) and the diamond industry, the DDI seeks to improve conditions and systems for artisanal alluvial digging and build on the foundations established by the Kimberley Process. Its aim is to develop an understanding of the issues and implement pilot projects in local small-scale informal alluvial diamond digging communities to address concerns e.g. working conditions, fair-pricing and formalization.
Together with other similar programs such as the Mwadui Community Diamond Partnership, the Peace Diamond Alliance, Diamonds for Development and the Communities and Small Scale Mining project of the World Bank, a real and lasting difference can be made to the approximately one million individuals and their dependents who make their living in the artisanal mining sector.

Links

UNDP. 2005. Botswana Human Development Report 2005 http://www.undp.org
IMF. Botswana: Statistical Appendix www.imf.org
Debswana http://www.debswana.com/Debswana.Web/People/HIV+and+AIDS/
Rio Tinto http://www.riotinto.com/SustainableReview/health/programmes/default.aspx