I can't find the article in the online edition, even though it's the
main headline in today's business section of the Edmonton Journal, but
here's something simple, but something I have to admit I'd never thought
of. How do you help control the flow of "blood diamonds"? What's to stop
brokers from buying diamonds from all the new mines that are opening up
in the Northwest Territories and Nunavut (even Alberta has a few
promising sites), sending them off to Antwerp for polishing and then
mixing in Liberian or Sierra Leonean diamonds and selling them to
wholesalers as Canadian?

Well, Tiffany's, the big New York-based jewellery chain has taken the
mountain to Mohammed: it's actually opening up a cutting and polishing
centre right in beautiful downtown Yellowknife, capital (such as it is)
of the Northwest Territories. The plant will cost C$3 million to build
and they have contracted with the Diavik mine for an annual supply of
US$50 million worth of gem quality diamonds beginning in 2003 (including
the laser-etching of a polar bear one of the bottom facets). That has
the advantage of getting around the oligopoly of DeBeers, which is
losing more and more control over the diamond market because of these
rather surprising finds in the Canadian Arctic (I mean, whodathunkit?).
Tiffany's figures 25% of its diamonds will eventually come from Canada,
and it can use this to market themselves as a "blood-free" supplier, as
it were. It cuts costs for Tiffany's, too, despite the remoteness of the
operation, because what they've done, of course, is integrate upstream,
as they say in the oil industry. That is, they've cut out New York, Tel
Aviv and Antwerp's middlemen and established their own cutting facility,
substantially reducing the cost of the final diamonds.

Good news for young fiancées (or the fiancés who pay for them) starting
in about 5 years: look for a drop in retail prices by 10-15%. [that last
part isn't in the article; it's my own personal estimate]

Marc A. Schindler
Spruce Grove, Alberta, Canada -- Gateway to the Boreal Parkland

"The greater danger for most of us lies not in setting our aim too high
and falling short; but in setting our aim too low, and achieving our
--Michelangelo Buonarroti

Note: This communication represents the informal personal views of the
author solely; its contents do not necessarily reflect those of the
author’s employer, nor those of any organization with which the author
may be associated.

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