Rough diamond prices higher in 2016 as production cuts and restocking flip supply/demand

Global production of diamonds increased 10.8% in 2010 compared to 2009, and its value soared by 45.2%, as the world economy improved and demand for diamonds restored. The Kimberley Process Certification Scheme, which tracks production and trade of rough diamonds to end trade in conflict diamonds, released on Wednesday the latest annual data, covering 2010. According to the KPCS data, global diamond production in 2010 totaled 133.1 million carats worth $12 billion.

Mountain Province Diamonds announced on Tuesday that the Gahcho Kué environmental impact study – all 11,000 pages of it – has been cleared and the review process – expected to take another two years – can now commence. Gahcho Kué, a joint venture between Mountain Province and De Beers, is the world's largest and highest grade diamond development project. It consists of a cluster of four diamondiferous kimberlites, three of which have a probable mineral reserve of 31.3 million tonnes grading 1.57 carats per tonne for total diamond content of 49 million carats.

Businessweek quotes a confidential report prepared for South Africa's mining CEOs as saying South Africa’s ruling party is closer to some form of nationalization than at any other time since the end of apartheid. A government takeover of mines could choke investments in a country with metal and mineral reserves estimated at 2.5 trillion and lead to a collapse of the currency, the rand. Firebrand Julius Malema (pictured), the leader of the youth wing of the ruling African National Congress which often acts as kingmaker in the country’s politics, is spearheading the campaign to seize mines, farms and banks. Malema is never far from headlines in the country with racially charged comments but now an anti-corruption police unit is probing a trust fund owned by him allegedly being used to funnel payments in exchange for securing government tenders.

Mining and exploration company Firestone Diamonds has announced a financing plan that will raise £13.5 million and provide updated development plans for its diamond mining and evaluation projects in Lesotho and Botswana.

The Zimbabwe Independent quotes finance minister Tendai Biti (pictured) on Friday as saying the reality of Zimbabwe's situation is that there is no connection between Zimbabwe’s income from diamonds, its output and international prices adding the country's resources are in danger of turning into curse rather than a blessing. Zimbabwe exported 716 958,50 carats from its alluvial diamond mines but only $103,9 million of diamond export shipments was accounted for in the first half of the year. The military seized control of the rich diamond fields in Chiadzwa in 2006 and most observers believe an international ban on these gems are being widely flouted.

Anglo American, one of the world's largest miners, today reported strong first half growth with operating profit ahead 40% to $6bn. Chief Executive Cynthia Carroll said that investments made during the downturn would stand them in good stead in the near-term future. "We believe that the fundamentals for the mining industry are very, very strong, and therefore the longer-term outlook is extremely positive." Image by shizhao

Despite a flurry of mergers and acquisitions and a robust IPO market reports out on Wednesday suggest that fear is slowly replacing greed in the mining finance business. The Financial Post reports for investment bankers, the low-hanging fruit is long gone and the biggest financings are now high-risk: gold juniors in Africa, coal in Colombia and an infamous Quebec lithium play that overstated its resource. Global Mining Finance's July round-up says untrustworthy financial and resource reporting, threats of new royalty regimes, "super-profit" and carbon taxes, political turmoil, strikes and government takeovers are worrying resource investors all around the world.

Zimbabwe’s diamond production reached 2.329 million carats in the first half of 2011 with the bulk coming from the controversial Marange fields, Finance Minister Tendai Biti reported to Parliament on Tuesday. The Treasury expects production to ramp up in the second half to reach 8.2 million carats for the full year, which would be slightly lower than the 8.435 million carats mined in 2010.

De Beers, the world's largest diamond producer, announced Tuesday that it will further expand its retail outlets in China, the Wall Street Journal reported.