Sunday, April 10, 2011

Sightholders excited over DTC CEO's visit to city

The visit of Varda Shine, chief executive officer, Diamond Trading Company (DTC) - a rough diamond marketing arm of the global giant De Beers - in Surat on April 12 is seen as an important development by diamantaires, especially the DTC sightholders (customers).

Shine, who is visiting the diamond city to inaugurate the world class diamond and jewellery institute 'City Centre' at Vesu, is likely to touch upon some of the key issues prevailing in the global diamond industry such as the rough diamond shortage and increasing prices, Kimberley Process's (KP) approval to Zimbabwe to export rough diamonds and the warning issued by the United States and the European Union, the upcoming renewal of DTC sightholder contracts for the period 2012-2015.

In the DTC's March sale, prices of rough diamonds across most categories of the De Beers rough production were increased. The price hike was significant in the smaller Indian goods by 30 per cent. The hike was the second to be implemented by DTC this year after the company raised prices by an average of 7 per cent at its February sale in London.

Given the increases, sightholders have noted that the rough market was currently in a bit of a confused state and that dealers are not sure how trading will develop moving forward. Premiums on DTC diamond boxes have reportedly softened slightly, but are still trading relatively high.

Furthermore, the recent announcement from DTC about reducing the minimum requirement to apply for being one of its recognized suppliers worldwide has spread joy among the diamantaires in city.

The new scheme has fixed a bit lower threshold limit of rough diamond trading for the past three years to $50 million from $60 million earlier.

"The decision will allow more diamantaires to apply for the supplier of choice (SOC)," Aagam Sanghavi of DTC sightholder company Sanghavi Exports said.

Industry sources said the issue of Surat Rough Diamond Sourcing Limited (SRDSL) formation by few of the leading DTC sightholders in Surat to directly source rough diamonds from Zimbabwe is likely to come up during Shine's visit.

"Despite the fact that KP has cleared Zimbabwe to export its rough diamonds, the US and EU have opposed by issuing warnings to the diamond cutting and polishing centres like India and Israel. The SRDSL was formed by DTC sightholders to source rough diamonds from Zimbabwe and now they may face the heat," a diamantaire requesting anonymity said.

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