IDMA president warns rough diamond producers

Within the message, Shkadov commented on how a joint marketing plan between rough diamond producers would increase the market share of polished diamonds and diamond jewellery in the luxury consumer product sector.

Laying out a series of bullet points analysing the rough market, Shkadov said: “Let’s take a look at who the customers buying rough diamonds are exactly, what their position and role is and how the industry that supplies polished to the end user actually does it, and most important, what they are saying.

“For instance, they may say that the only product manufactured from rough diamonds is polished diamonds; that the diamond polishing business is a money-losing business; that attempts in the last decades to cause sight holders to invest their resources into growing market share for diamonds have collapsed.”

Shkadov then used bullet points to ask questions of the suppliers: “Other questions that can be asked about the future are why the rough suppliers are depleting their clients’ resources by demanding rough prices are higher than those of the polished; devaluing their stocks; and reducing prices month after month instead of limiting the flow of rough to the oversupplied market?

“If the suppliers would care to answer these questions honestly, it would also help them understand where they might find themselves sooner than they expect – in the doldrums, together with the manufacturers.”

Believing there to be no real competition in the rough diamond market, Shkadov described companies as using clients as “money extraction machines”, which can’t function without “the necessary lubricant to keep the cogs moving”.

“Surely, the producers, too, must know that sales of diamond jewellery are declining, and are losing market share within the luxury goods consumer market?” he remarked.

“They, too, must know that a joint, dynamic effort is needed to increase demand for diamonds?

“They, too, cannot but grasp that such an effort should be funded by those who have the biggest stake in our pipeline, by those who sell their goods with the biggest profit margins?

“The question is therefore, why are they not stepping up to shoulder that effort? Wake up: your business – our business – is under threat.

“We, the manufacturers, will all help you in this endeavour.”

Image: Maxim Shkadov