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Tanzanite price hits rock
bottom
By Our Correspondent and
Edward Selasini
  
Mererani miners small scale
face uncertain future
TanzaniteOne, the foremost
tanzanite mining company in
Mererani has retrenched 200
workers from its list of
employees, amidst reports that
the price of the gem has dropped
by 50 per cent in the world
market due to the ongoing global
economic turndown.
The Simanjiro district based
company recently embarked on the
retrenchment exercise, according
to its executive chairman Ami
Mpungwe. He explained that his
company had experienced big
losses due to the unstable
mineral prices worldwide.
He said they have tried several
options, but have been forced to
cut down the work force as
production cost has become
unrealistic in relation to
mineral prices in the market.
The move is expected to affect a
lot of other business ventures
in Manyara, Arusha and
Kilimanjaro regions, as
tanzanite sales have been
stimulating money circulation in
the zone.
One can easily note the effect
in Arusha municipality as good
number of mineral shops have
closed down due to lack of
business, a move that is
affecting other business
ventures here.
Addressing journalists last week
in Dar es Salaam, Foreign
Affairs and International
Cooperation minister Bernard
Membe said the drastic drop in
the price of tanzanite on the
world market threatened the
industry and the future of local
miners.
``The ongoing global calamity
has affected the country,
especially the mining sector,``
he was quoted as saying by the
Guardian.
• The United States, South
Africa and Thailand were the
main markets for tanzanite,
accounting for about 70 per cent
of total sales, followed by Asia
(15 per cent) and Europe (5 per
cent).
He said this was the second time
for the price of tanzanite to
nosedive, the first time being
in 2001 after the 9/11 terrorist
attacks on the World Trade
Centre and the Pentagon in the
US.
According to local gemstone
dealers, the price of uncut
tanzanite in the country had
dropped by 50 per cent.
They said in separate interviews
that the gemstone, found only in
Tanzania, now fetched USD180 per
uncut gramme, down from USD 350
in June.
``This is the lowest price ever
recorded in the history of
tanzanite business,`` explained
gemstone broker Adam Leiyani.
Ndikaa Kerishu, a tanzanite
dealer in Arusha, expressed fear
that most local small-scale
miners would be hard hit by the
situation unless the price
improved over the next two
months.
``Most likely, many mine owners
will opt out, a move that will
lead to massive layoffs of
workers,`` he warned.
If that happened, he said, the
economy of Arusha, Manyara and
Kilimanjaro regions would suffer
a major blow because many local
residents would be rendered
jobless.
 Sammy Mollel, chairman of the
Tanzania Mineral Dealers
Association (Tamida), who is
also the Managing Director of
Gem and Rock Ventures Co.
Limited told the Arusha Times on
Wednesday that the problem now
faced in the tanzanite mining
industry was much more serious
than the one experienced after
the 9/11 terrorist attack on
America.
• He said businessmen suffering
severely because of the current
global financial crisis are
mainly the middlemen commonly
known as brokers who cannot
afford to trade in top notch
Triple A colored tanzanite which
still fetches high despite the
economic meltdown.
• Hamisi Lyoba chairman of the
Arusha Regional Miners
Association (AREMA) said despite
the crisis mining pits in
Mererani have not been closed
down but mining activities have
slowed down because of the
shrinking market of the gem.
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