The GGDO, The Government Gold and Diamond Office in Freetown Sierra Leone is the government agency in charge of issuing all export licenses for Gold and Diamonds if you want to export these commodities out of the country.
Such licenses can cost up to $45,000 per year, and without purchasing a license, or being able to use someone else’s, you will not be able to get your Kimberley Process Certificate to take the diamonds out of the country.
As of today, there are only 21 Companies with current Diamond Exporter’s Licenses, 40 with Diamond Exporter’s Agent Licenses, and 47 with Diamond Exporter’s Agent Certificate.
Most people will show you a fake license, and purchasing from these scammers can land you straight to prison, not to mention the fact that you will most likely lose your money. You will also need a Diamond Dealer’s License if you decide to purchase rough diamonds on your own.
If you decide to purchase rough diamonds in Sierra Leone, Madnox can save you lots of time, money and headaches with our operations on the ground in Freetown. Feel free to contact us at TradeDesk@Madnox.com or call us for consulting services at +1-305-600-1814
Manicaland Province Marange Fields have been known to be some of the largest source of diamonds in the world in the past few years. In 2015, Zimbabwe’s diamond production is expected to drop from 5.9 Million CTS to 3.5 Million.
Three new mines started operations last year in the Marange Fields, however, the increase in supply has not been steady, as these mining operations are expected to have a lesser impact, due to the fact that these are not alluvial mines.
Zimbabwe had a tremendous supply of alluvial diamonds, however, these alluvial diamonds have been mined extensively, and alluvial supply is running short. Therefore minors now have to dig for rough stones underground instead, making it more difficult and more expensive to mine for rough diamonds.
This is the number one reason for the decrease in production in the Marange Fields. In order to optimize the management and production of these mines, the Government is in the process of merging five mining companies into one large corporation.
Here is a summary of the Rough Diamonds Production in CTS per Country for 2014:
- Russia with 34,303,500 CTS Produced
- Botswana with 24,668,090.77 CTS Produced
- Democratic Republic of Congo with 15,652,014.63 CTS produced
- Canada with 12,011,619 CTS Produced
- Australia with 9,288,231.89 CTS Produced
- Angola with 8,791,340.01 CTS Produced
- South Africa with 7,430,955.94 CTS Produced
- Zimbabwe with 4,771,636.82 CTS Produced
- Namibia with 1,917,689.70 CTS Produced
- Sierra Leone with 620,181.11 CTS Produced
- Lesotho with 346,017.12 CTS Produced
- Tanzania with 253,180.25 CTS Produced
- Ghana with 242,259.59 CTS Produced
- Guinea with 164,058.72 CTS Produced
- Guyana with 99,950.34 CTS Produced
- Liberia with 65,822.49 CTS Produced
- Brazil with 56,923.25 CTS Produced
- Republic of Congo with 53,162.70 Produced
- India with 37,024.72 CTS Produced
- Cameroon with 3,718.16 CTS Produced
- Cote d’ Ivoire with 1,074.15 CTS Produced
- Togo with 16.72 CTS Produced
The Total World Diamond Production for 2014 was 124,778,468.08 CTS
Source: Kimberley Process Certification Scheme
Sellers and Buyers of Rough Diamond can often agree when negotiating a parcel of rough stones, that usually is the easy part, so what is the hard part?
The overwhelming majority of miners, located mostly on the African continent are mining rough diamonds and have stock piled these rough diamonds over the last few years, so lots of miners have stones, some nicer than others.
The issues are several folds, first, most miners have smaller productions in small villages, and do not know how to go about exporting to a foreign rough buyer, nor do they know any foreign rough buyers most of the time.
The second issue is that they do not have the cash flow to pay for the KPC’s all transport costs, tickets, hotels etc etc, so they can only sell the stones on an FOB basis and will not sell CIF.
The large wholesale buyers will tell you they have been around for too long to go and buy stones FOB, most of them will only purchase on a CIF basis in one of the major diamond hubs such as New York, Antwerp, Dubai, Geneva, Tel Aviv, Numbai or Hong Kong.
Latest updates from the DRC’s Ministry of Mines are as follows:
The Ministry of Mines has issued roughly 200 purchases & sales licenses, out of these 200 licenses issued in the DRC, only 15 to 20% of licensees have their licenses up to date.
The rest leases or sub lease other people’s license. There are only 30 to 40 companies in the DRC with up to date valid licenses, out of which 50% of these have export licenses, reducing the amount of licensees who can legally export diamonds from the DRC to 15 to 20 companies in the whole Country.
In our experience, the DRC is a very difficult place to do business and purchase diamonds, further more, we find DRC seller’s prices to be completely out of line with the rest of the African market, and fraud to be as high as it can get.
For these reasons, we have made the conscious decision to stay away from DRC Diamonds all together, doing business there is too challenging for our taste. If you decide to do business in the DRC, make sure you have proper security with you, and be ready to pay a premium price.
Exports of diamonds last month were just north of $1.5 billion, down by over 18 per cent from to $1.85 billion at the same time last year.
Volume wise, this decline was over 14 per cent, Indian trade exporting over 2.80 million carats in July this year, against 3.26 million carats last year.
Similarly, imports of rough diamonds in July fell 42.9 per cent to $1 billion against $2 billion last year. In volume terms, 9.36 million carats of rough were imported in July, a decline of 40 per cent compared with imports of 15.6 million carats in July 2014.
However the main markets both for rough and polished diamonds remained strong in places like Holland. Sourcing from Alrosa, the largest producer of rough diamonds. Another would be to make Mumbai a more attractive market in the global diamond trade, as India already cuts over 80% of the world’s diamonds.