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De Beers puts finishing touches to sales plan
Allan Seccombe
Posted: Mon, 17 Dec 2007
[miningmx.com] -- GLOBAL diamond giant De Beers will sell rough diamonds from its DTC offices in Botswana and Namibia for the first time, the final plank in its new sales plans.
The Diamond Trading Company (DTC), a subsidiary of De Beers, which sells about half the world’s rough diamond output by value, has increased the number of offices from just the one in London, which served as the sole outlet for De Beers’ diamonds up to this year.
Governments in the African countries in which De Beers operates has put pressure on the 45% Anglo American-owned company to sell more diamonds domestically as part of plans to boost local cutting and polishing projects, increase jobs and revenue.
DTC now has offices in Botswana, the world’s single largest supplier of rough diamonds, and Namibia after setting up joint ventures with the governments of those countries. It has an office in
South Africa.
DTC has 75 sightholders or clients for the April 2008 to end-March 2011 contract period, of which six are new members.
“This marks a transformation in the way the DTC’s rough diamonds are sold to clients globally, with new, independent joint-venture operations – DTC Botswana and Namibia Diamond Trading Company – selling rough diamonds to clients in Botswana and Namibia for the
first time,” De Beers said in a statement.
De Beers has in recent years changed the way it sells its diamonds. It picks out clients that are able to market their products along with a number of other criteria.
“We are successfully implementing a new commercial strategy. This involves restructuring our operations to help meet the wider economic goals of producer governments as well as providing our clients with the world’s best source of supply, supported by industry-leading intellectual property,” said Varda Shine, DTC’s managing director.
De Beers has sold a number of its unprofitable operations, most notably in South Africa, where it has sold mines, mothballed operations and tailings to smaller operators with lower overheads. The most recent sale was the Cullinan mine to Petra Diamonds, a major beneficiary of the restructuring underway at De Beers.
“Competition for rough diamonds is now fiercer than ever, and we are confident that the diverse
range of companies to which the DTC is able to offer supply are those best placed to add real value to the rough diamonds we sell,” Shine said.
The sightholders represent companies including dealers, retailers and jewellery makers of varying sizes.
“Each company will play an important role in meeting the changing needs of an evolving diamond market,” said Gareth Penny, managing director of the De Beers Group. “Building upon the significant achievements since 2000, the DTC and its Sightholders will work in even closer partnership to help secure the long-term competitive advantage of diamonds over other luxury goods categories.”
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