November Brimming With Rough Diamond Tenders in Antwerp: Calendar & Analysis

Rough Market
07/11/2016 14:22

The month of November in Antwerp is replete with rough diamond tenders and auctions from a full range of mining companies, including eight tenders from auction houses Bonas, DDA Trading, KOIN InternationalFirst Element and iHennig, three auctions by mining companies Rio Tinto (Diavik & Argyle mines), Grib Diamonds and Gem Diamonds, and the Rough Diamond Days at Antwerp’s Rough Diamond Bourse. The month will see mining companies of all sizes and from all across the globe converge in Antwerp: from large miners to medium and small-sized premium producers such as Lucara’s Karowe Mine (Botswana), DDA Trading’s marine rough from Namibia and Lipari Mineraçaõ’s Brazilian product from Braúna mine. It will also welcome the highly anticipated sale of Stornoway’s first stones from the Renard Mine in Canada. See AWDC’s Calendar for the full agenda.

Nearly $14 billion of rough diamonds entered the diamond pipeline last year, mainly from primary producers selling to the global diamond market. Given that primary producers supply the vast majority of rough, we asked diamond valuation and diamond insurance expert Tali Goldstoff of TGS about the significance of the tender and auction system in Antwerp. “The tender houses are not always doing multi-million-dollar sales per client, but create value with smaller parcel assortments that are user-friendly for smaller manufacturers, which means they are not buying excess diamonds they cannot use. The result is that a larger number of diamantaires can buy rough diamonds,” says Goldstoff.

“Magic Touch”

“No other trading center delivers such added value as Antwerp provides,” Goldstoff explains. “The diamond tender companies have the ‘magic touch’. They understand the diamond market, they create the sales assortments for their rough buying clientele and they provide the shipping logistics for them, all transparent and compliant. Due to their expertise, the tender houses create new rough diamond ‘brands’ or ‘labels’. All of this serves to boost rough prices for the global diamond miners, giving them further incentive to tender in Antwerp. Actually, some diamond tender companies also provide polished diamond tenders. It’s all about value creation. Antwerp’s diamond industry continues to advance. This is in part attributable to the growing tender system.”

Added value and consolidation

Goldstoff explains the workings of the rough diamond supply chain. “Rough diamond dealers, such as Sightholders and other ‘first-hand rough diamond’ buyers, add value to the ‘secondary market’ by providing tailor-made assortments and credit facilities. Some of the major diamond companies started to provide these assortment services internally to their manufacturing clients. A few years ago, the diamond tender companies started to provide their services to the smaller and junior diamond mining companies in Antwerp. These miners are experts in extracting rough diamonds but less specialised in selling their productions.” As a result, he says that, “The number of diamond tender companies expanded rapidly in Antwerp. These tender specialists add value to the mining companies by sorting, marketing, and preparing rough diamond parcels for all size manufacturers in an efficient and regular sales cycles.”

“The historical expertise and sheer range of services provided in Antwerp should not be underestimated. The fact is that all the major miners are present here in Antwerp. The absolute ease of conducting our diamond business here is due to the fact that shipping agencies, the Diamond Office and its streamlined system for issuing KP Certificates, finance and diamond insurance companies are all close at hand in ‘one street’. This all leads to an even wider range of services available to buyers and sellers from wherever they come.”