Diamond Mining Resurges In Latin America

[Judi Lynn]

Diamond Mining Resurges In Latin America
Oxford Analytica 09.24.08, 6:00 AM ET

Economic growth, political stability and unprecedented access to bank credit are driving a consumer boom in Latin America, particularly in Brazil, which is benefiting from high international commodity prices. Aware of demand, mining companies are tapping Brazil and Paraguay for their diamond deposits, reactivating an industry that was overshadowed by the dominance of South Africa in the early 20th century.

Brazil, Paraguay step up. As a Portuguese colony, Brazil drove the international diamond trade, experiencing a diamond rush between 1725 and 1860 until the Portuguese crown declared a royal monopoly on all diamond mining in the country and levied heavy taxes on mining concessions.

With the depletion of shallow alluvial deposits and the rise of South African mining, Brazil became a backwater with only modest production for much of the 20th century. That scenario is now changing as diamond exploration and mining pick up in the interior states of Mato Grosso and Minas Gerais and the coastal state of Bahia.

Paraguay is also seeing an interest in diamond exploration. Diamonds were found in the northeastern region in the 1960s, and miners have begun to map the geology of gemstone-bearing igneous rocks that run from the Brazilian Amazon into Paraguay. Venezuela and Guyana also have some diamond production, while some exploration is under way in Uruguay.

More:
http://www.forbes.com/business/2008/09/23/brazil-diamonds-paraguay-biz-cx_0924oxford.html