Botswana to benefit from Russia diamond ban
Lewanika Timothy | Tuesday January 16, 2024 06:00
This week during a visit to the De Beers, Gina Drosos CEO of Signet Jewelers, an international jewelry trader said that she is hopeful that once the ban is fully instituted will direct the markets eyes to Botswana hopefully sparking up demand for the countries rough diamonds.
“We are one of the companies intentional about the ban of Russia diamonds and we think that it will open pockets of opportunity for Botswana diamonds in the market” she said
Last year the G7 announced that it will ban all imports of rough diamonds directly from Russia from this month. Other measures include the ban extending to include Russian diamonds that have been processed in third countries. .
The diamond industry has spent much of the past three months aggressively lobbying G7 decision makers behind the scenes about how the ban should be implemented, focusing on the method used to trace diamonds. Should the ban go on as planned by the G7, the absence of diamonds from the largest producer by quantity in the world is predicted to possibly raise the prices for rough diamonds due to supply falling below demand levels.
The forecasted recovery of the diamond market follows a tough year for rough diamonds, De Beers, the world’s largest diamond producer by value, reached a three-year low in sales in November netting a provisional $80 million, the lowest amount since April 2020 when demand and prices crashed due to COVID-19.
Before that, the August sale by De Beers, brought in a provisional $370 million, a 42% sale drop on a year-on-year comparison reflecting the challenging period rough diamonds are enduring. By comparison, sales at the previous auction, the sixth of the year, were measured at $411 million.
Leading contributors to this year’s tough diamond performance were weakening demand from the world’s leading economies. The USA which accounts for more than 50% of the world’s retail diamond market demand, has been battling inflation with the Fed hiking interest rates in progressive quarters. Fed hikes shrank consumer disposable incomes, weakening demand for the rough stones.