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AFRICA

The flawless 8.88ct Pear diamond
produced from Lucapa’s Mothae mine
in Lesotho
along peers in Africa, with Sierra Leone, lieves the two industries can co-exist, a
Guinea, Central African Republic, Zim- sentiment shared by Wetherall.
babwe and even Mozambique trying Wetherall said there was a place for
harder to grow their diamond industries. synthetic diamonds, particularly as there
Africa is already responsible for pro- was demand from younger consumers.
ducing 60% of the world’s diamonds and “It pits younger people’s eyes onto
Wetherall is certain the continent will re- diamonds at an earlier stage and that
main an investment hotspot for diamonds means that they might want to maintain
for many years to come. their interest in diamonds and go to natu-
“There’s a huge amount of interest. If rals in due course, so I actually think it is
you have a look at some of the other op- a positive from our perspective,” Wether-
erations that aren’t as well-known as the all said.
public ones; the way they are looking at Emergence of the synthetic diamond
restructuring the interest in those opera- market impacted the natural sector to
tions is quite strong,” Wetherall said. a small degree in 2018/19 and while
“Anglo American [plc] is coming to An- Wetherall believes there is room for both
gola now and has signed five contracts sectors to exist, it is the way that some
for exploration in the sector and there synthetic producers penetrate the market
are other majors in discussions with the which is of concern.
diamond sector as well. Angola has been “Where we have an issue is where
underexplored for so many years and is people try and market it with very false
seen as one of the countries that is most marketing terms and promoting them as
likely to produce the next Tier 1 discov- being environmentally better. It is not; it
ery.” takes a huge amount of power to grow
With its famous Argyle diamond mine those diamonds,” Wetherall said.
in Western Australia scheduled to close “They need to be open, honest and
ment of the Kingdom of Lesotho) and re- later this year, it is believed Rio Tinto Ltd transparent and we as natural producers
port record group production. may be keen on opportunities in Angola don’t have a problem with that whatsoev-
Total carats recovered from Mothae as well. er. But when you enter the grey area and
and Lulo for FY19 was 49,120ct, in- Vibrancy in the diamond sector ap- diminish one sector to promote another
cluding 1,164 plus-4.8ct and 357 plus- pears not to be limited to Africa, with that is where we have a problem with it.”
10.8ct diamonds recovered. Sales to- former Riversdale boss Michael O’Keefe Whether the popularity of synthetic
talled $US55 million (100% basis) and driving ASX-listed EHR Resources Ltd’s diamonds is sustained will only be know
$US1,127 achieved per carat. pitch to acquire Nanuk Diamonds Inc for with time, however, as technology ad-
Wetherall said he was “chuffed” with its diamond fields in Quebec. vances quickly, sustaining the sugar hit
the way 2019 ended, which will be re- will be a challenge for the indus-
flected in the company’s quarterly try.
results due to be released at the “In an industry like synthet-
time of print. ics or lab grown [jewellery] the
“We were very pleased with our advancement of technology one
new operation that we commis- year to the next means it is go-
sioned early in the year and how ing to be a hell of a lot easier for
it performed in its first year, it cer- new people to come in,” Wether-
tainly exceeded our plan quite sig- all said.
nificantly,” Wetherall said. “Synthetic diamond prices in
“From a market perspective, we the last 3-4 years have seen
are also happy with the way the negative movement. A diamond
market ended. Diamantaires were priced at $4,000/ct four years ago
back at the tenders bidding strong- is now selling for $800/ct. As an
ly, their prices were up, certainly investor in that business to try and
from what we saw in the sector maintain your revenue stream
in terms of a subdued and volatile Stephen Wetherall when prices are going backwards
2019.” means you must sell more. When
Upward movement in pricing is expect- Signs of life in the diamond sector also you have to sell more you are going to
ed to continue in the first part of 2020, provides perspective on the perceived be competing with other synthetic pro-
with the momentum coming on the back threat of the synthetic sector overwhelm- ducers. That means you are just going
of a merry festive season. ing the industry. to put so much into the market that you
“The jewellery sales in America and De Beers has taken a measured ap- are going to shatter the price of the lab-
China were very strong and with a strong proach to the realms of lab grown jewel- grown diamonds. The fashion jewellery
festive season you are going to find very lery, however, the likes of Alrosa are not demand is fairly new in our space, so in a
strong restocking happening in the first so keen. couple of years let’s see where it goes.”
part of the year as well,” Wetherall said. Despite dismissing any participation in
The same tailwind is also pushing the synthetic diamond space, Alrosa be- – Mark Andrews

aUSTRaLIa’S PaYDIRT FeBRUaRY 2020 Page 67