Rapaport Magazine

U.S. Polished Imports, Exports Show Growth

Economic Bulletin

By Rapaport
U.S. polished diamond imports rose 22 percent year on year to $1.45 billion during the month of December and polished exports were up 24 percent to $1.15 billion. The country’s net polished imports totaled $299 million, a 17 percent improvement against December 2009. Rough diamond imports to the U.S. in December rose 70 percent to $63 million and rough exports fell 21 percent to $54 million, giving the U.S. net rough imports of $9 million.

While polished diamond imports to the U.S. rose 45 percent to $18.06 billion in 2010, this total was still lower than the polished import total reported for the peak years of 2008 and 2007. Polished exports surged 42 percent year on year to $13.76 billion, making 2010 the second-strongest year for polished exports, behind 2008. Net polished imports for 2010 rose 57 percent to $4.30 billion. Rough imports jumped 81 percent year on year to $524 million as rough exports rose 44 percent to $341 million, leaving net rough imports of $183 million compared with $53 million in 2009.

Israel’s Polished Exports Rise

Israel’s polished diamond exports rose 9 percent year over year to $617.9 million in January 2011, according to the Central Bureau of Statistics (CBS). Rough exports increased 25 percent to $381 million during the month, while total imports of rough and polished diamonds grew 38 percent to $742.1 million. Israel’s January net diamond account, representing total exports less total imports, fell 23 percent to $256.8 million.

India’s Polished Exports Gain

India’s polished diamond exports rose 23 percent year on year to $2.11 billion in January 2011, according to the Gem & Jewellery Export Promotion Council (GJEPC). The average price of the polished exports increased 25 percent to $441.63 per carat. Polished imports grew 120 percent to $2.28 billion, while net polished exports fell to negative $166.1 million from the positive $673.7 million recorded a year earlier, indicating that India was a net importer of polished during the month.

Japan’s Imports Increase

Japan’s polished diamond imports rose 19 percent year on year to $52 million in December 2010, according to Momozawa & Co., based on information obtained from the country’s Customs Bureau at the Ministry of Finance. By volume, polished imports grew 14 percent to 188,683 carats, while the average price of imports increased 4 percent to $275 per carat.

For the full year of 2010, Japan’s polished imports were up by 12 percent to $693.6 million, with production rising 12 percent to 2.4 million carats. The average price of Japan’s polished imports through the year held stable at $285 per carat.

BHP’s Diamond Revenues Up

BHP Billiton reported that its diamond revenues grew 11 percent year on year to $427 million during its first fiscal half of 2011 that ended December 31, 2010. Production, however, fell 10 percent to approximately 1.4 million carats at its Ekati mine. BHP Billiton owns an 80 percent stake in Ekati, its only diamond operation. Earnings before interest, taxation, depreciation and amortization (EBITDA) at the diamond division rose 12.5 percent to $278 million.

Russia’s Rough Exports Jump

The value of Russia’s rough diamond exports increased almost fourfold to $2.16 billion, while the country’s production volume totaled 30.6 million carats in the first nine months of 2010, Itar-Tass reported. Russia’s Finance Ministry stated that rough diamond imports fell by more than 200 percent to 52,600 carats, generating $51.1 million during the nine-month period. Finance Minister Alexei Kudrin said the government is considering opening a diamond exchange if market conditions allow.

Rio Tinto’s Diamond Sales Rise

Rio Tinto reported that its diamond sales rose 52 percent year on year to $682 million in 2010, spurred by higher rough prices and rising demand from the Far East. Net earnings from its diamond business totaled $70 million for the year, compared with the loss of $68 million posted for 2009. Production was down due to the processing of lower-grade ore at the Argyle mine’s open pit as the company develops its underground mining operation. Production at the Diavik Diamond Mine in Canada’s Northwest Territories reached 6.5 million carats, 17 percent above its 2009 total. The company’s operating diamond assets were valued at $1.19 billion at the end of 2010.

Petra Diamonds’ Profits Fall

Petra Diamonds reported that net profits fell 35 percent year on year to $24.5 million during the six months that ended on December 31, 2010, but the mining company anticipates rough demand will remain strong. The average prices achieved at its February tender were 6 percent to 8 percent higher than in the previous six months.

Revenues for the fiscal half-year rose 86 percent to $90 million, helping profits from mining activity to triple to $24.5 million. Petra plans to raise production to around 4 million carats by fiscal 2014 and achieve annual output of 5 million carats by fiscal 2019.

Namibia Expands Production

Total gemstones mined in Namibia rose 57 percent in 2010 compared with 2009, according to The Namibian. Sales generated from production rose 32 percent to $766 million (NAD 5.6 billion). About 1.52 million carats of Namibian diamonds were sold globally in 2010, nearly 12 percent more than in 2009 and earnings totaled $246 million (NAD 1.8 billion) more than those of 2009.

—Additional reporting provided by Acquire Media.

Botswana’s Exports Show Growth

Botswana’s diamond exports rose 24 percent year on year to $805 million in the fourth quarter of 2010, according to the Bank of Botswana (BoB). For the full year, diamond exports increased 39 percent to $3.01 billion. The bank’s data is sourced from the Diamond Trading Company Botswana (DTCB), two of 16 manufacturing units in the country and the Central Statistics Office (CSO).

Sierra Leone’s Rough Exports Jump

Sierra Leone exported approximately $109 million in rough diamonds during 2010, an increase of 28 percent from 2009, according to a report cited by news agency AFP. Rough diamonds imported to the U.S. rose by 29 percent to $3.66 million from January through November 2010.

IGE Achieves Record Prices

IGE Resources AB reported that it sold a parcel of 1,400 carats of diamonds from the Cassanguidi mine in Angola for $434,000 in January 2011. The average price of $310 per carat set a new record for the mine, with the sale buoyed by the inclusion of a high-value, 16-carat stone. IGE Resources expects diamond values from Cassanguidi to be in the $160- to $180-per-carat range in 2011. The previous per-carat high achieved for Angola production was $220.

Trans Hex Sells $20 Million

Trans Hex reported that sales at its February rough diamond tender totaled $19.8 million. The company sold 12,817 carats for an average $1,547 per carat at the tender, including two stones from the Baken Mine in South Africa, which sold for more than $20,000 per carat. Trans Hex also reported sales of $3.8 million in December and January from the Luana project in which the company holds a 33 percent stake. 

Stornoway Shares Will Consolidate

Common shares in Stornoway Diamond Corporation began trading on a one-new-for-four-old consolidated basis at the market on February 22, 2011, following approval by shareholders and the Toronto Stock Exchange (TSE). The corporation will continue to trade in Toronto under the symbol “SWY.TO.”

Gold Jewelry Demand at $56 Billion

The World Gold Council (WGC) reported that global jewelry demand totaled 1,468.2 tons during the first nine months of 2010, increasing 18 percent from 2009. Jewelry demand totaled $55.5 billion during the first three quarters of 2010, the same amount spent globally on gold jewelry for the entire year of 2009.

Article from the Rapaport Magazine - March 2011. To subscribe click here.

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