DTC and WFDB Discuss Industry Issues


September 30, 2004

DTC and WFDB Discuss Industry Issues

Officials from the Diamond Trading Co. and the World Federation of Diamond Bourses met Sept. 9 to formulate an action plan ahead of the World Diamond Congress to be held in New York City Oct. 17-20. The groups identified the most pressing need of the industry to be bolstering consumer confidence in natural diamonds.

Among the challenges they identified were:

Synthetic diamonds: The industry must defend the integrity of natural mined diamonds in the face of mounting quantities of synthetic diamonds entering the jewelry trade. "It is essential that an all-industry strategy be developed to defend the position of the natural diamond," said Shmuel Schnitzer, president of the WFDB. "The special position of our product from the perspective of the consumer is vested in its uniqueness and rarity. We cannot allow a situation to develop that will undermine the natural diamond's image." DTC Managing Director Gareth Penny said DTC takes the challenge seriously and pointed to synthetic identification technology developed by DTC and sold through the Gemological Institute of America in Carlsbad, CA.

Grading certificates: The groups agree laboratory certificates should clearly identify any diamond treatments and/or if diamonds are synthetic, so that consumer confidence regarding natural goods can be ensured.

Money laundering: Any decisions made at the World Diamond Congress regarding efforts to eliminate money-laundering activities in the diamond business would receive full cooperation by DTC and WFDB.

Diamond supply: Penny assured WFDB members DTC was living up to its commitment to sell $500 million in rough to the secondary markets (non-sightholders) at a variety of trading centers via Diamdel, a De Beers Group marketing arm which sells smaller, more irregular goods to smaller-scale diamond manufacturers. This aspect of DTC's distribution of diamonds has received criticism in recent months because dealers had felt that not enough diamonds were being sold that way. Penny also said that Supplier of Choice strategies are working, particularly since the moves have help drive up demand for diamonds worldwide. He noted that diamond jewelry is on track to grow 8% in volume dollar sales worldwide. WFDB members had complained of late that Supplier of Choice was disenfranchising many diamond dealers in an effort to be efficient in its distribution channels. "Supplier of Choice works with many different business models," said Varda Shine, DTC sales director. "The DTC recognizes that dealers play an important distribution role in the industry today and many of our clients and some of our major marketing programs involve dealers."

by Robert Weldon, G.G.

Sign me up for
THIS WEEK @
professionaljeweler.com