De Beers Copes With Crisis
By Rob Bates -- JCK Online, 3/1/2009 2:00:00 AM
After what some called its lowest sights in 20 years, De Beers told clients it will slash mine production in half this year, a decision that has prompted massive layoffs in its African mines.
In a more controversial move, De Beers told its clients it would begin selling to non-sightholders but then reversed itself a few days later.
After many diamonds were left on the table at its December allocation, Diamond Trading Company managing director Varda Shine said she was exploring options for the surplus stones, including selling to non-sightholders and even investment funds.
That raised questions: Would the new buyers have to comply with DTC's Best Practices Principles? Wouldn't this devalue sightholder status?
Perhaps it's not surprising that a few days later the plan was abruptly shelved. The new plan is to have a Sight Week II at its February sight, where De Beers will sell “refused boxes and out-of-balance stock” to other sightholders. After that, selling outside the sightholder list is still a possibility, says spokeswoman Lynette Gould.
