To most Americans, the country of Botswana doesn’t come up in everyday conversation. Yet, to the diamond industry, it is one of the most powerful countries in the world. The small country is a larger supplier of rough diamonds. In the coming years, it is likely to be a growing importance in the diamond industry and it may help to keep up with demand for diamonds with an increase in supply, so that the cost of a diamond doesn’t keep rising as they become more scarse. As you consider the diamond industry yourself, you may want to consider the benefits you see here.Botswana posted some great numbers recently. The country’s diamond exports grew considerably during the first quarter of 2008 (mind you, this is at a time when most of the globe’s stocks, luxury goods and belts are being pulled tight.) During the first quarter of 2008, the country saw a rise of 6.8 percent in their exports. This is equal to about US $1.04 billion. This is according to the latest figures available from the Bank of Botswana.
Botswana is a large exporter of diamonds, but it is also the world’s largest producer of rough diamonds. The country’s improved mining ability and better regulations seem to be helping the country improve its production and therefore the supply of the diamonds it provides. By all comparisons, the growth in the number of exports here is likely to be quite what is necessary in the industry to keep up with the continuous increase in demand.
If you go further and measure the increase against the country’s currency locally, you will find that diamond exports rose 10.8 percent. The currency in Botswana is the Pula or BWP. Go even further with this comparison. The Bank of Botswana also reported that when you compare the current growth in the industry there with that of the final quarter in 2007, you will find a remarkable 53.9 percent increase in US dollars. By comparison in Pula, or Botswana currency, you see a 63.6 percent rise in the industry. In all situations, these are very remarkable numbers.
While these numbers are quite impressive, they may not tell the whole story. In the end portion of 2007, for example, the country’s production of diamonds fell considerably. This happened because of the inability to mine at the same pace. One of the country’s larger mines was closed because of problem with one of the mine’s smelter. This slow down closed off the plant for some time while maintenance was done to get the non-working system back up and running well. Since that time, the amount of production has steadily increased.
Now, look at the number of exports that happened in 2007. These numbers seem to have risen over the previous year themselves (even with a closed producer!) The export numbers for 2007 grew by some 4 percent to BWP 20.5 billion. This is about US $3.43 billion. When you look back even further and compare 2005 to 2006, you will see an even more significant increase. From 2005 to 2006, the number of exports from Botswana increased by 16 percent.
The Botswana government and companies are making a few changes along the way, though. For example, the diamond production in the country has continuously been on rough diamond production, which sent out around the globe for the final diamond preparations to happen. While diamond production in rough diamonds is not likely to stop, or even slow significantly, the government is planning to make some significant changes. Now, about 10 percent of the production of rough diamonds will be in the hands of local diamantaires. This is happening because there has been an increase in the number of beneficiation developments throughout the country, making it possible for more of the product to be finished in the country.
This is for view through the Diamond Trading Company Botswana, known as DTCB. They are an equal partnership between De Beers and the Botswana government. They held their first sight just a few months ago. The process was complete to 16 local manufacturers of the diamonds who will work on the cutting and the polishing of the rough diamonds for production.
Botswana is not doing anything to slow the number of exports it sees, though. For example, a new sorting facility will be opening in Gaborone in Botswana. The facility, which has ownership and run by the Diamond Trading Company Botswana, will be able to take in some $6 billion worth of rough diamonds and export them around the world by 2009. This increase in the country’s ability to export these diamonds will only help to grow the industry within the country even more so. Botswana is likely to stay a prominent figure in the world’s production of diamonds for years to come.
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