Commodities: Russia's Diamond Hoard Has the Potential to Crush the Diamond Market (or not)

The thing that amazes me is that they were able to keep it secret for almost 40 years.
From the Christian Science Monitor:
Russia reveals shiny state secret: It's awash in diamonds 

'Trillions of carats' lie below a 35-million-year-old, 62-mile-diameter asteroid crater in eastern Siberia known as Popigai Astroblem. The Russians have known about the site since the 1970s.

 Russia has just declassified news that will shake world gem markets to their core: the discovery of a vast new diamond field containing "trillions of carats," enough to supply global markets for another 3,000 years.

The Soviets discovered the bonanza back in the 1970s beneath a 35-million-year-old, 62-mile diameter asteroid crater in eastern Siberia known as Popigai Astroblem.

They decided to keep it secret, and not to exploit it, apparently because the USSR's huge diamond operations at Mirny, in Yakutia, were already producing immense profits in what was then a tightly controlled world market....MORE

Although the CSM was the first place I saw the story, a couple of other sites have industry reactions.
From American Public Media:
Diamond dealers shrug off "new" Russian mine

This week, Russian state media announced the existence of a 62-mile-wide diamond deposit in Eastern Siberia. Russian scientists say the diamonds are at the bottom of 35 million-year-old meteor crater.

But the big players in the diamond business aren't all that impressed.

Yossi Malka works for the Tel Aviv Diamond Company in Portland, Oregon. Most of the inventory he works with is kept in a white plastic bucket, and a single diamond he holds could be worth over $45,000.

But Malka says he doesn't expect the news out of Siberia to deflate the price of the stones in his safe. "It's nothing new," he says. "The Russians have been mining diamonds for a long time."
In fact, this newly-discovered deposit isn't new at all: The Russians have known about it since the 1970's.  And although it was considered a state secret, it wasn't a very well kept one.
"The fact that it hadn't been made particularly public was because it wasn't that important," says Des Kilalea, a London-based analyst with the Royal Bank of Canada....MORE

And from the Israeli Diamond Industry website:
IsDMA Responds to News of Russia Diamond Deposit

In the wake of the publication of the news about a massive new diamond deposit in Russia, we asked the Avraham Traub, President of the Israel Diamond Manufacturers Association, for a response:

"Yesterday evening, when the Jewish new year holiday ended, I received many phone calls in the wake of a news item that was publicized in the media about a new diamond deposit in Russia.

"According to this news item, the deposit contains an unlimited amount of diamonds for thousands of years hence. There is no doubt that Russia, the biggest country in the world, has been blessed with an abundance of mines and many great natural resources, and as you know it also has an abundance of diamonds.

"According to sources in Moscow who are in the know, who I have conversed with a number of times, the report was wrongly inserted into the news cycle, as it is without merit. The deposit does in fact exist in Russia for many years now, but nothing has changed. I hope that in the days to come we will receive more clarifications about the news item. There is no reason to think that in the near future it will have any significant impact on the diamond trade. I'm telling you to continue working and continue smiling and supporting your households."

Be that as it may, I've got to believe that Nicky Oppenheimer is not having second thoughts about last years sale of the Oppenheimer family's 40% stake in De Beers.

They received $5.1 Billion in cash.

And still retain a chunk of buyer Anglo-Merican's stock.

Previously:
End of the Oppenheimer Era at DeBeers: Nicky Oppenheimer on What the Family Will Do With the $5.1 Billion