De Beers expected to deny Lev Leviev a sight

Lev Leviev, Israel’s largest diamond merchant, will not receive a sight from the De Beers diamond syndicate, according to a De Beers’s plan for 2005-2010, obtained by an Israeli online business publication.

According to the plan, sights will be distributed to 86 Israeli and other diamond merchants for two and a half years, instead of the previous two years, the publication Globes reports.

De Beers subsidiary Diamond Trading Company (DTC) is expected to publish the rules on January 1, 2005. Under these rules, diamond merchants with mines in excess of $30 million to $40 million will not receive sights, according to the publication. Leviev’s diamond mines amount to hundreds of millions of dollars, mostly in Africa, but also in Russia and Canada.

De Beers reportedly says that cooperation with the owners of large diamond mines would increase the partners’ control of raw diamond mining to a monopolistic level.

Israeli diamond industry sources told Globes that the new policy may also deprive Benjamin (Beny) Steinmetz of a sight. Steinmetz, a close associate of De Beers, who has regularly received sights from the syndicate, will be able to obtain sights only through a diamond company controlled by another Steinmetz family member, who does not deal in diamond mines.

Leviev has exported an estimate $600 million in diamonds from Israel this year. His diamond mines in Africa and Russia are estimated at almost $1 billion, and his total diamond business is estimated at over $2 billion.

Leviev, one of De Beers’s biggest competitors, has previously expressed opposition to the syndicate’s monopoly, including its business in Russia. He nevertheless asked De Beers for a sight.

Under De Beers’s new plan, at least five Israeli diamond traders will receive sights for the first time, in addition to the fifteen Israeli diamond companies that already receive sights, Globes reports. De Beers recently notified five more diamond traders that they had good chances of obtaining sights, but that they were still being checked out.