Backgrounder
The Canadian Government Diamond Valuator

In the Northwest Territories and Nunavut, the Government of Canada, through Indian and Northern Affairs Canada (INAC), is responsible for the administration of Crown lands, including minerals under the Territorial Lands Act and its regulations including the Canada Mining Regulations.

The Canada Mining Regulations specify that each operating mine pays a royalty to the Crown based on the value of the output of the mine, after certain allowable deductions.

For most minerals, such as lead, zinc, copper, gold or silver, which are homogeneous commodities, the value of output is a straightforward calculation based on the value of the minerals sold. Mineral prices are quoted on international commodity exchanges.

However, diamonds are not a homogenous commodity. Stones may have values ranging from pennies to millions of dollars. Diamonds are valued individually or in small lots of stones of similar size or colour. Prices for rough diamonds are established by closed, private markets based in Europe and elsewhere. Rough diamonds are not sold in large quantities or in public commodity markets, as is the case with most other minerals.

Because of the closed structure of the rough diamond market, it is difficult to establish the value of diamond production. As a result, most major diamond producing countries, such as Australia, South Africa, Botswana, Namibia and Angola retain the services of government diamond valuators (GDV) and require diamond production to be valued by the GDV prior to sale or export.

Back to News Release

Backgrounder - Diamond Mining in Canada's North

Backgrounder - Diamonds International Canada Limited

Back to News Release Index