Surat diamond industry may import roughs from Canada

Surat’s diamond processors are looking at direct imports of rough diamonds from Canada to ensure reasonable prices and better availability, Rohit Mehta, president, Surat Diamond Association, said today.

“Canada is one the world’s largest rough diamond producing countries and we are keen to have some tie-up with mining companies there which will allow us direct imports of roughs,” Mehta said.

A delegation of the association will visit Canada to try and enter into direct import pacts, he said.

Mehta said the delegation plans to meet companies that have small mining operations as the large ones are already in pacts with the Diamond Trading Corporation.

Currently, Surat diamond processors depend on DTC for import of rough stones, he said.

DTC, the rough diamond distribution arm of De Beers Group, has a global monopoly in distribution of rough diamonds and controls prices of roughs.

Housing over 4,500 diamond processing units, Surat is considered the global hub for diamond cutting and polishing.

India’s diamond processing industry generates annual revenue of around Rs 60,000-70,000 crore, 80 per cent of which comes from Surat-based units.

“Currently, we are facing problems in sourcing of smaller rough stones. Prices of rough diamonds smaller than a carat have risen considerably in the last few months. However, the prices of polished diamonds have not risen in tandem,” Mehta said.

The rise in prices of rough diamonds was leading to narrowing margins of processors with prices of only smaller rough diamonds fluctuating.

“Larger diamonds are still considered as items of luxury and demand and prices do not fluctuate much,” the official said.

According to Gem and Jewellery Export Council, India’s rough diamond imports in 2009-10 (April-March) stood at $9.03 billion, up from $7.91 billion a year ago.