ROMANCE OF THE AFRICAN DIAMOND INDUSTRY.

New Zealand Herald, Volume XLVII, Issue 14566, 31 December 1910, Page 5 (Supplement)

ROMANCE OF THE AFRICAN DIAMOND INDUSTRY.

HOW RHODES AND BARNATO FOUGHT FOR SUPREMACY.

History vouchsafes few more romantic stories than that contained in the diamond industry of South Africa and that country's meteoric rise to fame and fortune from the insignificant little State it was less than half a century ago. The new era, which has just dawned, with, the great inauguration, and the simultaneous publication of the life of Cecil Rhodes, vividly recall that romancehow the great statesman turned his wonderful finds to Imperial ends, and how his opponent, Barney Barnato, sought only to benefit personally and commercially all that he could. Diamonds and Africa have been associated with one another since the time of King Solomon and his mystic runes, but it was not till 1867 that the first diamond appeared, that is, to the knowledge of the world to-day. In 1867 a poor farmer's child, whilst playing on the banks of the Orange River, found a particularly pretty stone which lie carried home in his pocket and dropped with a handful of other pebbles on the farmhouse, floor. A neighbour named Van Niekerk saw it and offered to buy it. "It is only a pebble," the boy's mother said; "you can keep it if you want it." The discovery of this single pebble by a child at play led to the diamond industry as it now exists. Ten months later a second diamond was found, at a spot more than thirty miles away, and in 1868 a few more diamonds were picked up by some sharp-sighted natives. In 1869 a superb white diamond, weighing 83.5 carats, was picked up by a shepherd lad near the Orange River. Van Niekerk bought it from the boy for what was a monstrous price in the eyes of the lad, namely, for 500 sheep, 10 oxen, and a horse. The lucky purchaser sold it easily a few days later in Hope Town for £11,200, and it was subsequently purchased by the Earl of Dudley for £25,000. The discovery of this beautiful gem, since famous as " iiio Star of South Africa," created an immense sensation, and caused a tremendous rush to the banks of the Vaal. The choice of a location was chiefly determined by caprice. Some diggers preferred to investigate light patches of ground, others chose the darker soil, whilst others simply dug at large without any principle to justify liwir choice. The largest diamond found in these riverside diggins weighed carats. In 1871 came great discoveries in the soil of three farms where Kimberley stands to-day. The property

BELONGED TO TWO POOR BOER FARMERS (D. H. and J. N. de Beer), who little thought at the time that they had been living over wealth incalculable, or that their name would be immortalised in the annals of diamond mining. The story is told that the Bultfontein mine was 'discovered by the finding of a diamond in the mortar used by a fanner when plastering his house. The subsequent and successful search for diamonds was in fact made in. the pit whence the, sand for the mortar had been taken. The riso of the De Beers camps was even more rapid than its predecessor at Bultfontein. But most marvellous of all was the growth of Kimberley. Here it is: —

Kimberley in 1870, non-existent, merely a site— desolate and poverty-stricken expanse of prairie. Kimberley in May, 1871, —a canvas town sprung up in a night like the fabled Palace of Aladdin. Kimberley in December, 1871, a flourishing town of 56,000 inhabitants, with clubs and hotels.

Kimberley in 1910 the City of .Diamonds —a city of which any nation might be justly proud, with its line streets, luxurious clubs, and theatres, all built up out of diamonds.

Mining on the present scale soon began with a terrible list of accidents, however, which led inevitably to the amalgamation of competing claim-owners and, to the consolidation of interests, from which the great De Beers Company was born, in which connection must be told stories of two men, whose names are as household words, Mr. Barney Barnatoand Mr. Cecil John Rhodes. In July, 1873, Barnett Isaacs, a young Hebrew of good though humble standing, sailed from England to Capetown to join his brother Henry, who had previously gone out to the diamond fields. Henry had fancied and taken the surname of Barnato when he first tried his luck in the diamond field as a music-hall performer. When he turned to the more profitable business of diamond dealer his stage name still stuck to him, and his younger brother familiarly BECAME KNOWN AS BARNEY BARNATO. Barney took vast risks, and made corresponding gains. His mind worked so

quickly and his mental calculations were so exact and minute that it was often supposed that, he jumped at conclusions. He saw with the clearest vision that the sole chance of continuing the diamond mining industry on a profitable basis lay in the amalgamation and consolidation of the rival claim holders. About this time in his history, in 1880, he came into keen rivalry with the only competitor that was ever able to make headway successfully against —Cecil Rhodesthe younger sou of a. Hertfordshire clergyman, who came as a weakly boy, in 1871, to South Africa, also to join his brother Herbert on a small plantation in Natal. His Health having improved, he returned next year to England, and entered his name at Oriel College, Oxford. Incipient lung disease necessitated his return once again to the mild, clear air of the highlands of Natal, where he found his brother Herbert just setting out, like so many of his fellows, for the irresistible diamond fields. The success of the elder brother drew Cecil also, somewhat reluctantly, in 1873, ovear to Kimberley. So it happened that, unknown to each other and unaware of their future clash and rivalry, Rhodes and Barnato started abreast on the same field and on the same track in the race for fortune and for mastery. With variant motives thev sought the end of great riches; one for the sheer satisfaction of money-making, the other chiefly an a means to attain Imperial ends, to light up the Dark Continent, and claim it for the British flag. Both realised the necessity of effecting combinations covering the whole diamond field, in order to secure uniform and efficient development, as well as to control the output of precious tones. In the same year, 1880, as Barnato floated his mining company in connection with the Kimberley Mine, Rhodes, with some loyal associates, founded the De Beers Mining Company.

A TITANIC STRUGGLE. between the two now commenced. Money was not very plentiful in those days, as is shown by one of the first cheques of the De Beers Mining Company, drawn by Rhodes in his own favour for .€5 " as an advance against his salary as secretary." Rhodes's master project was the .attainment and control of the four grot diamond mines of _ South Africa, and lii& work of first uniting all the interests in the De Beers mine was the beginning of this great dream. The struggle now centred upon the control of the Kimberley Mine, which involved direct conflict with Barney Barnato. Backed by Lord Rothschild an d Mr. _ Alfred Beit, Rhodes began buying, with apparently limitless means, all the Kimberley interests that could be secured ; they were prepared to expend at least two millions sterling to secure the control. Meanwhile, Bornato was bidding against them with unfailing pluck. The price of the shares mounted by leaps and bounds, each -bidding the other, but at last Barnato had met his match, and ultimately consented to be bought out. A cheque for £5,338.600 —surelv the greatest ever known in mercantile records— by De Beers Consolidated Mines. Limited, gave to the latter the all-important control of the Kimberley Mine. It is: only just- to Barnato to note that he was as loyal in his later -operation with Rhodes as he had persistent in his antagonism. ■ His tragic death some years later when he jumped from a South African liner will be well remembered. For years, past the De Beers Co. has sold in advance its annual production of diamonds to a Hatton Garden syndionte, through whom distribution to the rest of the world takes ' place. The policy of the De Beers Company has always been to avoid thrusting diamonds upon an unwilling market. Diamonds are luxuries, and the demand for them depends very much upon the general prosperity of trade, in America in particular. There appears, tavs the Times, to be on the average something like five million sterling per annum available for .the purchase of the higher class rough diamonds, and it is therefore

SIMPLY COURTING DISASTER to attempt to put out a greater quantity of the stones than can be absorbed by * the gem-buying public. De Beers do not believe that the production of a greater quantity of diamonds and the putting of them on the market would result on the whole in any larger amount of money being obtained from the consumer. Attacks have often been made regarding the prospects of the De Beers Mines. It has been stated that the mines are moribund and that the profits qjay disappear altogether ia the near future. Deliberate restriction of output is interpreted as a petering out of the supply of stones. Such reports emanate usually from those whose livelihood depends upon the ups and downs of the sharemarket. At the present. moment there are on the floors some 9£ million loads of blue ground, while there are in sight in the Do Beers, Kimberlev, Wesselton, Bultfontein, and Dutoitspan Mines a grand total of over 57 million loads. At the present rate of crushing and washing—about 4| million loads per annum—the blue grounds on the floors and in sight will last for over twelve years, and with a yield similar to that which it is now giving will produce about 4364,000,000 worth of diamonds.