25 Oct 2023

The second edition of the Facets Conference, hosted jointly by the Botswana Government and the Antwerp World Diamond Centre (AWDC), recently took place in Gaborone under the theme; Motswedi Wa Khumo (Diamonds for Change). 

The conference was dedicated to exploring the future of the diamond industry, with a specific emphasis on the challenges faced by diamond-producing nations. 

In a captivating panel discussion that delved into the intricate workings of the African diamond industry, Mr Mmetla Masire, managing director of the Okavango Diamond Company (ODC), brought his wealth of expertise, spanning over three decades, to the fore. 

The panel discussion was skillfully moderated by Edahn Golan, a renowned diamond industry analyst with more than two decades of experience in various facets of the field. Mr Golan specialises in a wide range of topics relating to this industry. 

His diamond analytics range from rough diamond pricing to jewellery consumer behaviour, including how the diamond market operates, the economics of manufacturing, and the impact of lab-grown diamonds on the industry.  The conversation commenced with a focus on how the industry determines the fair distribution of diamonds among stakeholders. Mr Masire highlighted the importance of considering the value of these precious gems. 

He said: “We have got a process where we look at the value of the diamonds, and that is a factor taken into consideration in determining how they split,” underscoring the significance of valuing diamonds as part of the distribution process. 

The panel discussion also delved into the special and exceptional categories of diamonds. 

These unique gems, with their distinct characteristics and substantial economic impact, are often treated differently within the market. 

“Generally, the specials and the exceptionals are a small portion of the bigger allocation. So we normally hold them all at the same tender time, but they will be priced and sold individually,” Mr Masire explained. The discussion then shifted to the possibility of forming partnerships within the diamond trade.  The concept of miners partnering with downstream and midstream players to enhance the selling process was also explored. 

Mr Masire confirmed that ODC was open to such collaborations. 

The global diamond market was not spared in the conversation, with a particular focus on the inventory stock up crisis that has emerged from the consumer market. 

Mr Masire acknowledged the significant impact on ODC. 

“There is a crisis that is brewing up from the consumer market. 

It has impacted ODC quite significantly,’ he said. 

This crisis, attributed to various factors, including the pandemics’ influence on consumer demand, poses complex challenges for the diamond industry. 

Balancing the inventory of diamonds and securing fair prices was also discussed. 

Mr Masire provided insights into the deliberations at ODC, explaining how they navigate the delicate balance between selling diamonds and ensuring that both buyers and sellers benefit. 

“There are two issues. You could theoretically sell, but are you selling at a good and fair price for both parties, for the buyer and for yourself as the seller? And this is the challenge,” he said. 

The discussion turned to the potential implications on G7 and 39’s traceability requirements on the diamond industry. 

The conversation revealed that ODC had not yet adopted a traceability solution, but was actively exploring partnerships with suppliers to comply with these requirements. 

“The G7 requirements are going to be a challenge for all of us that are involved in the supply of diamonds,” Mr Masire said. 

The discussion highlighted the potential cost implications of identifying and tracing diamonds to prove their source. 

Mr Masire acknowledged that these costs might ultimately be borne by consumers. 

He stressed the importance of shared responsibility within the industry to address these challenges and ensure transparency. ENDs