North America Diamond Sales Show No Sign of Slowing
Diamond sales in the North American region continue to be on the upswing owing to a steady demand for the precious stone. Without a doubt, Canada and the United States are the major players in the diamond industry in North America.
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Canada has been a major success story in the field of diamond production. From the first discovery of diamond in 1991 at Point Lake in the Northwest Territories, the country has achieved so much. Canada now counts on its four mining sites as major sources of diamonds – three in the Northwest Territories (Ekati, Diavik and Snap Lake) and the new one in Nunavut (Jericho) resulting in the country’s ranking as among the top three diamond producers worldwide.
According to Statistics Canada, the country mined about 13.8 million carats of diamonds between 1998 and 2002 valued at $2.8 billion. It was in 2003 when Canada earned the ranking of being the world’s third biggest producer of diamonds after Botswana and Russia. The country now accounts for 15 percent of the world’s total diamond supply.
Canadian diamonds are also renowned globally for being high quality and conflict-free stones. Conflict-free refers to the diamonds being clean and not used to finance terroristic campaigns, war and weapons. Apart from being clean, Canadian diamonds look more wholesome. In fact, one could easily distinguish a Canadian diamond as a speck of polar bear is etched on the stone as its trademark.
With four mining sites in place, Canada sees no depletion of its diamond resources in the near future. The current mines are expected to continue producing some of the world’s best diamonds for the next 18 years.
Diamond sales in the United States remain to be a big challenge to numerous jewelers. However, with a steady demand for the precious stone especially among jewelry lovers as well as engaged and married couples, diamond sales have been positive all these years.
The U.S. is the biggest diamond jewelry market worldwide and most of the supply goes through New York, the country’s entry point for this rare stone especially the large and uniquely shaped rough diamonds. New York is the place where nearly 80 percent of the world’s diamonds are sold including at auction. It boasts of the Diamond District which features 2,600 independent diamond shops and stalls selling a wide selection of jewelry pieces and watches as well as 25 exchanges. Trade on this exclusive block for diamonds averages $400 million in one day alone.
Diamond jewelry accounts for more than 50 percent of global sales. In 2005 alone, total retail sales for the diamond jewelry in the U.S. were pegged at $33.7 billion. The Diamond Information Center revealed that the figure was an increase of $2.2 billion over the 2004 sales worth $31.5 billion.
Loose diamonds that come into the U.S. are used in jewelry making and industrial applications. Manufactured diamond makes up more than 90 percent of the industrial diamond used in the States. Majority or 80 percent of mined diamonds equivalent to 100 million carats are not suitable as gemstones and are therefore utilized for industrial use such as cutting, drilling, grinding and polishing. In specialized applications, they are used in high pressure experiments, bearings and windows.
The unique and superior properties of the stone especially its hardness make it the most versatile engineering material worldwide and ideal for a wide variety of applications in the industrial sector. For one thing, the diamond cuts faster and is more durable compared to other materials.
In the U.S. and Canada, major players in the diamond industry adhere to certain standards in an effort to ensure the trade of only genuine and conflict-free diamonds. One of these is the Kimberley Process Certification Scheme (KPCS) which was approved by the United Nations on March 13, 2002 and created in November 2004 courtesy of the governments of diamond-producing nations, diamond producers and non-government organizations.
Presidents Bill Clinton and George W. Bush have each issued separate Executive Orders prohibiting the importation of rough diamonds from conflict-stricken countries such as Sierra Leone and Liberia. Another Executive Order 13312 known as the Clean Diamond Trade Act (CDTA) was carried out by the federal government in July 2003 in response to the KPCS move. The implementation of the act proved beneficial since the U.S. is the biggest consumer of diamonds worldwide.
Canada, on the other hand, has taken the necessary steps as well to halt the trade of conflict diamonds. The Canadian government passed the Export and Import Rough Diamond Act in December 2002 to control the import, export and transport of rough diamonds through Canada. It also takes into account the Kimberley Process as a minimum requirement of certifying rough diamonds. In addition to this, the government also issues the Canadian Certificate, a requirement in the shipment of diamonds.
The international diamond industry is committed to impose regulations to protect the industry. To date, 69 countries strictly follow the Kimberley Process which monitors the journey of rough diamonds from the mines to the jewelers. Additionally, the industry provides jobs to many developing countries eventually improving their economy and the health of their people.
The processing of diamonds occurs in 30 countries but the main centers are in Antwerp, Johannesburg, Mumbai, New York and Tel Aviv. About 55 percent of the world’s diamonds are processed in India while China and Thailand are also keeping up.
Back in 2002, the Rio Tinto Group said that the diamonds produced and released to the market worldwide were worth billions of dollars in different categories. For rough diamonds, the total production was valued at US$9 billion, US$14 billion for the cut and polished diamonds, US$28 billion for wholesale diamond jewelry and US$57 billion for retail sales.
Experts foresee a stable supply of diamonds worldwide due to a lack of major new discoveries. De Beers managing director, Varda Shine, says although the housing crisis in the U.S. poses a challenging year for the diamond industry, the value of big polished and rare diamonds regardless of their color would continue to go up.
Currently, the very wealthy people demand for very rare stones that are of higher quality, bigger sizes and varied colors such as whites, yellows or blues.
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