The Diamond Empire: De Beers, the Oppenheimers, and the Making of Modern South Africa
The story of diamonds in South Africa is not merely a tale of gemstones; it is a narrative of staggering wealth, ruthless consolidation, and a family dynasty that shaped a nation’s economy for over a century. From a chance find on a riverbank to a global monopoly, the history of De Beers and the Oppenheimer family is etched into the very bedrock of South Africa.
The Spark: Eureka and the Star of Africa
In 1867, the course of South African history changed when 15-year-old Erasmus Jacobs found a “pretty pebble” on the banks of the Orange River. This was the 21-carat Eureka Diamond. Two years later, a second discovery—the 83.5-carat Star of South Africa—shattered the myth that the first find was a fluke.+2
The ensuing “New Rush” drew thousands of prospectors to a lonely hill called Colesberg Kopje. This site would eventually become the Kimberley Mine, famously known as the “Big Hole”—the largest hand-dug excavation in human history.+1
The Rhodes Era: The Birth of a Monopoly
Among the fortune-seekers was a young Englishman named Cecil John Rhodes. While others dug for stones, Rhodes saw the bigger picture. He began by renting water pumps to miners and used the profits to buy up small claims.+1
By 1888, after a legendary financial battle with his rival Barney Barnato, Rhodes merged their interests to form De Beers Consolidated Mines. His goal was simple: total control. By the time of his death in 1902, De Beers controlled roughly 90% of the world’s diamond production, regulating supply to ensure that diamonds remained rare and expensive.+1
The Rise of the Oppenheimers: Sir Ernest
As the Rhodes era faded, a new titan emerged. Ernest Oppenheimer, a German-born immigrant, arrived in South Africa in 1902 as a diamond buyer. In 1917, with backing from J.P. Morgan, he founded the Anglo American Corporation.+1
Ernest was a visionary who realized that the future of diamonds lay in global stability. He began aggressively buying shares in De Beers, and by 1929, he was elected Chairman. He famously stated:
“Common sense tells us that the only way to increase the value of diamonds is to make them scarce, that is, to reduce production.”
He consolidated the Central Selling Organization (CSO), a “single-channel” marketing system that forced nearly all the world’s diamond producers to sell through De Beers, effectively setting global prices for decades.
Harry Oppenheimer: The Consolidator and the “Forever” Slogan
In 1957, Ernest’s son, Harry Oppenheimer, took the reins. If Ernest was the founder of the empire, Harry was its master architect. Under his leadership, De Beers became a global household name.+1
In the late 1930s, Harry had recognized that the diamond market was flagging. He commissioned the N.W. Ayer advertising agency, leading to the 1947 creation of the most famous slogan in advertising history: “A Diamond is Forever.” This campaign transformed the diamond from a luxury for the elite into an essential symbol of romance for the middle class.+1
Harry’s legacy was complex. He was a prominent critic of the Apartheid government and a member of the opposition Progressive Party. However, his mines relied on the migrant labor system that underpinned the era’s social inequalities. By the 1980s, the Oppenheimer empire (Anglo and De Beers) accounted for an estimated 60% of the value of the Johannesburg Stock Exchange.+2
The End of a Dynasty
The third generation, led by Nicky Oppenheimer, navigated the company through the end of Apartheid and the rise of “conflict diamond” concerns. The family focused on legitimizing the trade through the Kimberley Process and shifting De Beers from a secretive cartel to a modern luxury brand.
In a move that shocked the business world in 2011, the Oppenheimer family sold their remaining 40% stake in De Beers to Anglo American for $5.1 billion. This ended 85 years of family control, marking the end of one of the world’s last great industrial dynasties.
Legacy of the Stones
Today, De Beers remains a titan of the industry, but the “Oppenheimer Era” is remembered as the time when South Africa was the undisputed center of the gemological world. The family’s footprint remains in the galleries, libraries, and conservation projects they funded across the country.
