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Showing posts from April, 2012

Diamonds on the block - anybody buying?

The diamond world now feels otherworldly.  We got a big hint when the Oppenheimer family decided to sell out, then BHP starts looking to sell their mining operations, and now Rio Tinto jumps in as well.  As a major supplier, Russia holds out.  Does anyone think that we are seeing "business as usual?" A few added points.  Rio Tinto's plan to go underground at the Argyle mine has incurred big overruns. BHP's Ekati mine (its only one) is declining in output.  Both companies see little future in diamonds, and present output contributes little to their overall profits.  De Beers (now an Anglo-American branch, in essence), in its current round of selecting sightholders, has opened the door much wider for tenders and allowing others to buy diamonds.  Then, on Rapaport's reports, we see that about 900,000 diamonds, worth about $6 billion, are listed for sale.  And these diamonds average just over one carat in size.  That alone is enough for every bridal store in the US