Russian diamond producer Alrosa has tweaked its rough selling system so that its new contracts resemble the ones offered by De Beers.
Among the changes: For the first it’s time publishing its entire 47-client list online; it is making all clients sign contracts that all run for the same time period; and it’s letting long-term customers use the name Alrosa Alliance in advertising.
The mining giant’s previous contracts with clients varied in length, says company spokesperson Evgeniya Kozenko. But now each client has a three-year contract, which began in January.
The company’s new long-term client list, which has 10 new names, includes nine companies from Russia, 16 from Belgium, 12 from India, five from China, four from India, and one from Belarus. Among the clients JCK readers will recognize: Laurelton Diamonds, a subsidiary of retailer Tiffany & Co.
Alrosa sells 70 percent of its production via long-term contracts, with another 15 percent sold on the spot market. The remaining 15 percent is made up of any mined goods larger than 10.8 cts., which are sold via international auctions, as well as an assortment of smaller goods, sold via tenders.
The company’s long-term clients received standardized boxes sorted according to set criteria, but can apply for additional goods over their contract. Alrosa holds sales every month, rather than 10 times a year, like De Beers.
“We afford our clients a right to reject a part of diamonds without any penalties,” says Kozenko, adding that that percentage is increased during weaker markets and decreased during stronger ones.
As with other miners, clients must agree to an ethical code, Alrosa’s Guidelines on Responsible Business Practices.
The 10 recently added companies are: A.C. Diamonds; Asian Star Co.; K.P. Sanghvi; Karp Impex; L&N Diamonds; Sahar Atid Diamonds; Sheetal Manufacturing Co.; Venus Jewel; Lazurit-D; and LLD Diamonds.