Harare Russian state-controlled miner Alrosa, the world’s biggest producer of rough diamonds in carat terms, raised $11.8 million in its first New York diamond auction of the year, as it seeks to increase its activity in the United States.
Alrosa and Chinese-owned Anjin are the two foreign companies chosen by Government to partner the state-diamond firm in exploring and mining diamonds. Government announced in December 2018 that it would allow two private companies to explore and mine gems and Alrosa said last week it had set up a local subsidiary to start operations.
Anjin is not new to the Zimbabwean diamond mining industry as it previously mined the Marange diamond fields until 2015 before Zimbabwe’s government decided against renewing mining licences for gem miners in the area.
In a statement on Alrosa’s website, Rebecca Foerster, president of Alrosa, North America, said sanctions against some Russian companies did not diminish the appeal of Russian high-quality diamonds.
Alrosa resumed operations in New York last year after they lay dormant for two years because of what the company said were “organizational changes” and concerns related to the previous team.
It held two diamond auctions there in 2018, which between them raised $18.3 million from international buyers.
By comparison a single New York sale in March this year of large stones, all of more than 10.8 carats and some as large as 50 carats, raised $11.8 million.
“The United States is a target market for growth. It’s by far the largest diamond market,” Foerster said in an interview.
She said this year Alrosa was aiming for four sales of rough diamonds in the United States, including the March sale that has just taken place, as well as two auctions of polished stones.
Last month, the Company said it will assess the quality of Zimbabwe’s diamond reserves over the next six months but would only start mining if it can take a majority stake in such a project.
The country is seeking to attract investment and has scrapped legislation that restricts foreign participation for some commodities. It has yet to do so for diamonds and platinum but has said that it will.
The move by Government to open the diamond industry to largest players in the world is vital as this will revive the struggling economy, helping shore up the crippled foreign currency.
The Zimbabwe Consolidated Diamond Company extracted 2,4 million carats between January and October 2018, far higher than the 1,8 million carats achieved in 2017.
With the two major players coming on board the industry is likely going to increase output thus cushioning the country’s struggling economy.
Moreover, London-listed Vast Resources and Botswana Diamonds have said they are planning to mine diamonds in Marange in partnership with a local community trust.
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