BoB revises annual diamond exports to P17.2 bn

MBONGENI MGUNI
Staff Writer | Wednesday December 8, 2010 00:00

The revision, from P1.99 billion means that diamond exports for the third quarter were valued at P5, 125.5 billion, the second highest for the year following the P5, 168.2 billion recorded in the first quarter.

The August figures, however, are the single highest for the year and have contributed to the revision of year-to-date exports by about four percent to P17.2 billion from P16.6 billion.

The recently released diamond sales figures will likely rise before year-end as the Bank's statisticians continually revise figures, using differences between BoB and Central Statistics Office data.

The latest revisions confirm expectations of high sales from the Diamond Trading Company Botswana (DTCB)'s August sight.

At the time, industry experts expected the 16 cutting and polishing firms to snap up gemstones in order to beef up for US Thanksgiving, Christmas festive season and Chinese New Year.

'The cutting and polishing firms take about four months manufacturing the rough stones before they read the diamond retail lines in time for the Christmas and New Year frenzied buying period.

'End and beginning of year marks the diamond retail industry's peak period, accounting for a large percentage of sales,' said an official with a local diamond manufacturer.

While BoB's statistics indicate that while October diamond exports of P1.99 billion were higher year-on-year, the figures are yet to replicate the bumper performance seen in 2008 when sales reached P2.2 billion.

According to the BoB, October 2010 export figures are 60 percent higher than October 2009, but nine percent lower than October 2008.

The determining factor was the global recession which weighed down diamond exports starting in November 2008 and stretching up to the last quarter of 2009.

De Beers strategists expect China and India to constitute between 13 and 16 percent of the market for polished diamonds by 2016, breaking away from the US traditional dominance.

The shift is mostly influenced by growing middle classes in both markets, forcing diamond manufacturers and retailers to innovate new marketing strategies and products.

Greater uptake by the American, European and other emerging markets has also enabled producers such as Botswana to increase their 2010 output, with Debswana revising targets from 20 million carats to 23 million.

Prior to the recession, Debswana's four mines were pumping out approximately 33 million carats annually.