Diamond sales procedures should be revamped to do away with outdated practices, Reuters reported with a reference to HB Antwerp co-founder and managing partner Oded Mansori.
According to him, to survive the current price slump, diamond producers should change their perception of diamond tenders and auctions which are opaque and inefficient.
"For years, miners relied on tenders and auctions, systems that look efficient on paper but in practice resemble a casino," Mansori said in a statement.
"Rough stones are pushed into opaque markets where value is anyone's guess. When global demand softens, as it has in cycles over the last decade, producers are left exposed. Workers pay the price, while shareholders watch assets decline."
Mansori, added that producers' revenues should be tied to the eventual polished value of its stones "rather than gambling on rough sales in opaque auctions".
HB Antwerp buys special rough diamonds (+10.8ct) from Lucara Diamond. Companies signed a diamond sales agreement in 2020, which was renewed for a further 10 years in 2022. HB Antwerp accounted for 72% of Lucara's $74-million diamond revenue in the six months to June 30, up from 65% the year before.
In late 2023, Mansori left HB Antwerp to return to the company just a month later. Around the same time, Lucara ended its supply contract with the manufacturer, but reinstated the agreement a few months after Mansori’s return. The split with Lucara also caused the government of Botswana to pause a proposed deal with HB Antwerp to acquire a 24% stake in the manufacturer’s business.
Theodor Lisovoy, Managing Editor, Rough&Polished
