The diamond in ancient India - Diamantschleiferei Michael Bonke

Both now bought the claims of the diamond searchers, which were practically useless for them,and founded their own mining companies. It triggered off a vehement battle for the supremacy onthe mining fields. Ultimately, Barnato succeeded in obtaining supremacy over the Kimberley minein 1887. But Barnato was a common man, and thus, was fighting a losing battle with the banksand authorities in the English aristocracy. Therefore, he finally united with his competitor Rhodesand on 12th March 1988, the “De Beers Consolidated Mines” was formed, with Cecil Rhodes asthe chairman. Over 75% of the Kimberley mine and the entire De Beers mine belonged to thiscompany. From there on, De Beers developed its supremacy step by step, such that eventuallyalmost all mine claims in South Africa were under its control.Rhodes and Barnato also used external capital in their advancement, by establishing theircompany as a stock corporation.However, the entire operation in South Africa had a problem, right from the beginning: therewere far too many diamonds discovered. Till the first South African diamond discovery in 1886,the entire world market was supplied by Brazil. The deposits in India were depleted and Brazilwas the only large diamond supplier in the world. But the discovery in South Africa was huge ascompared to the Brazilian one. In 1871, when the first large diamond was found on the slopes ofthe Colesberg Copje, the production of the claims on the former De Beers farm and on Colesbergalready amounted to 269,000 carats. In 1872, the production was already six times more than thetotal production in Brazil. In 1873, 1,080,000 carat diamonds were already mined in South Africaand in 1877, a total of 1,765,000 carats. This was clearly too much to keep the price stable. Whilethe local price of diamonds in 1871 and 1873 was still 1.5 English pounds, the price sank to barelyunder one pound per carat till 1877. At that time, an English pound had a purchasing power thatwould equal about 200 euros today.The beginning of diamond mining in the De Beers farm region and the Kimberly mine was chaoticand unorganised. There was hardly any systematic connection to the outside world. Till 1877,there was no telegraphic connection to the city of Kimberley and the region became accessibleby train only in 1885. Buyers, mainly from London and Amsterdam came to the mining fieldsin droves tried to buy stones from the prospectors for as low prices as possible. Prospectors,who had made a good find and were not satisfied with the buyers’ offers, travelled to the coastwith their stones and tried to sell their diamonds in Cape Town, or even took the next steamer toLondon. It was not uncommon for the prospectors to obtain an even lower price there than whatthe buyers had offered and to bring their stones back to South Africa.In all this chaos, where buyers and prospectors underbid and overbid, where the prices fordiamonds constantly dropped, where the costs for pumps and devices and for the taxes that weresuddenly imposed on diamond prospecting suddenly increased, there was sudden panic amongthe claim holders. The fear was that the value of diamonds would drop so much that diamondprospecting would become unprofitable.