The stability of the diamond industry is largely in the hands of 122 manufacturers and dealers that buy rough on a contractual basis.
Many of the sector’s current problems have resulted from too much rough entering the market in the past two to three years. Most of that supply is provided through the long-term sales programs that De Beers, Alrosa, Dominion Diamond Mines and Rio Tinto operate. Under those systems, customers commit to buying certain quantities of goods at prices determined by the seller, in return for consistent supply over an extended period.
De Beers offers about 90% of its rough through the Global Sightholder Sales program, with the rest available at its auctions. Most of the company’s customers are “international” sightholders, while those with Botswana, South Africa or Namibia sights must manufacture the goods within those countries. Clients that hold “accredited buyer” status have access to excess supply sightholders rejected, known as ex-plan goods.
Alrosa sells approximately 70% of its supply through its Alrosa Alliance program. Three additional members are currently candidates for potential Alrosa supply, and are classified as “Other.” Dominion Diamond Mines and Rio Tinto also operate contract sales, with the latter calling its arrangement the Select Diamantaire program.
These buyers are, therefore, the core of the trade, and how they buy rough and sell the resulting polished highly influences the overall state of the diamond market.
The following list of 122 rough buyers is an extract from the July issue of the Rapaport Research Report, which includes an in-depth look at the factors impacting diamond prices and midstream profitability, and presents extensive proprietary data from RapNet. Subscribers can download it here.
Click here to view the table of rough buyers as a PDF.