Its auction division will experiment with three-month contracts
De Beers announced that its online auction division will experiment with fixed-price forward contracts.
These contracts will give auction customers the ability to bid for guaranteed access to future supply at a set price. The initial agreements run for three months.
The first will cover grainers, smalls, and near-gems.
The contracts seemingly counter dealers’ main gripe about auctions—that they offer no guarantee of future supply.
“Our customers have told us they see value in securing short-term supply contracts but would prefer to do so on a fixed-price basis, avoiding potential challenges when securing contracts on a floating price basis that references the underlying spot price at contract maturity,” said Neil Ventura, executive vice president of auction sales, in a statement.