A one-size-all model for selling rough or polished diamonds will never work, according to Robert Wake Walker, a consultant at WWW International Diamond Consultants.
He told delegates at the Dubai Diamond Conference during a panel debate on “Diamonds in distress: navigating geopolitical tensions, economic realities, and supply chain pressures” that there is a need for a hybrid model.
“How can you have major diamond companies selling in large volumes and prices that do not marry up with actual joint conditions when it's hearing goodbye or inactive? Those questions are very difficult to answer,” he said.
“There are some positive elements of a hybrid model, which I'm sure I am just advocating. But a one-size-all approach to selling rough diamonds or polished diamonds will never work, and we'll never see that, but I think enabling them to have the ability to just build a financial forecast for a diamond company is very difficult when you don’t have the underlying sales figures that are aligned with the spot price on a specific day.”
Walker said those companies that do sell through auctioning tender can benefit from the “crazy” financing rates of investment for that reason.
“So as an industry, we've talked about the structural side there, but there are elements that we can do to essentially be more transparent both with regards to the market [and] investment,” he said.
“As most politicians would say, but it's the same within our industry; we're able to be more transparent around how sales processes work, how prices are achieved... I think more financial institutions will come to the table. If you look at it actually, it's important that financial institutions aren't getting comfortable with the industry.”
Mathew Nyaungwa, Editor-In-Chief, Rough & Polished, from Dubai, United Arab Emirates
