Ishemunyoro Chingwere Business Reporter
THE Zimbabwe Consolidated Diamond Company’s (ZCDC) stock pile of about 1,5 million carats has improved its gem or near gem quality from predominantly industrial quality by 34 percentage points following an enhanced cleaning and deep boiling exercise that aims to maximise on revenue.
Through its new Diamond Value Management (DVM) processes which analyses a diamond’s passage “from the mine to the finger”, the state owned diamond mining entity is seeking to maximise revenue for the fiscus by ensuring efficiency and effectiveness across the entire value chain. Zimbabwe last year sold diamonds at a measly average of $54,74 per carat with the precious stones’ composition standing at 93,2 percent industrial and just 6,8 percent gem or near gem quality.
Bench-marking operations to its technical partners from the world’s best diamond producing countries, the state mining entity has withdrawn from the market for later sales at the best possible time while stockpiling produce but has at the same time used the market sabbatical to enhance the value chain.
“ZCDC’s partnership with Ke Nako in the cleaning of diamonds is being enhanced to ensure effective cleaning outcomes,” said the state miner’s chief executive officer Dr Moris Mpofu.
“Through enhanced cleaning, ZCDC has managed to realise a significant improvement in the quality mix of diamond parcels as the true qualities of the diamonds are revealed after applying appropriate cleaning mechanisms. Notably, the quality mix has improved from 90:10 (industrial: gem or near gem) to 56:44 after application of enhanced cleaning processes.
“This has significant implications on the quality or value that would be realised by Zimbabwe from current diamond stock holdings of about 1,5 million carats,” said Dr Mpofu. As part of enhancing the cleaning, the state miner has also acquired a Diamond Processing and Deep Boiling facility which it is in the process of upgrading and resourcing with modern technology and appropriate intellectual property with the ultimate goal to remove non diamond impurities that conceal the true quality of diamonds.
An analysis of the market by the state miner revealed that the inability to effectively clean rough diamonds had seen diamonds which otherwise could have been classified as “Gem” or “Near Gem” being classified and sold as “Industrial” diamonds thus prejudicing the State. Meanwhile the decision to withdraw from the market by the re-branding entity has been extended after the miner noted softening of prices as well as sluggish demand in the fourth quarter.
“In line with effective sales and marketing frameworks ZCDC also took a deliberate decision not to sell its diamond stock in December as rough diamond prices remained on a downward trend in the last quarter of 2017 owing to seasonality effects and other supply and demand dynamics. ZCDC is however preparing to re-enter the market under a revised marketing and sales framework that involves the Reserve Bank of Zimbabwe and the Minerals Marketing Corporation of Zimbabwe,” said Dr Mpofu.