INTERVIEW – Diamond inventories shrinking, boosting outlook for suppliers – World Diamond Council President

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The Kimberley Process, which aims to prevent conflict diamonds from entering the market, has proved to be very effective, Edward Asscher, President of the World Diamond Council (WDC), told Jewellery Outlook Editor David Brough. Mr Asscher was interviewed before attending the VOICE event in Vicenza, running from September 12-14, 2020, the first jewellery trade show since the start of the emergency. At VOICE, he will join a seminar organized by CIBJO-World Jewellery Confederation.

How effective is the implementation of the Kimberley Process currently?

EDWARD ASSCHER: The implementation of the Kimberley Process is at present very effective. There is only one country under partial sanctions, which is the Central African Republic (CAR). The system in place there allows for monitored exports from specific areas that are verified as being conflict free.

Of course, we are closely watching developments in some other countries, but at present the KP has no intention to intervene elsewhere.

Right now about 99.99% of all rough diamonds are guaranteed as being conflict free.

How is the market for natural diamonds evolving during COVID-19?

EDWARD ASSCHER: As we know from the figures published by the mining companies, the rough diamond market is currently under pressure. The slowdown in diamond jewelry sales at retail has a negative multiplier effect on the polished diamond wholesale market and even more so on the sale of rough diamonds.

The positive element in all of this is that inventories of rough and polished diamonds, which were considerable before the crisis, are shrinking and this ultimately will bring about an improvement in the financial situation of many companies.

How do you expect the lab-grown diamond segment to develop in future?

EDWARD ASSCHER: The World Diamond Council’s mission is to represent the diamond and jewelry sector in the Kimberley Process, helping ascertain that the supply of KP-certified rough diamonds is not contaminated with conflict diamonds.

Issues related to synthetic diamonds are outside the scope of our organization.

That said, I would personally observe that the market penetration of synthetic diamonds is slow and that prices for these goods are under pressure, because of the increased rate of production and the improvement of technologies.

You will be in Vicenza for VOICE, participating in a seminar organized by CIBJO. What is the contribution of CIBJO in the World Diamond Council?

EDWARD ASSCHER: CIBJO is a founding member of the WDC. Its president has always been a strong defender of our work and of responsible sourcing, as it relates to diamonds and other gemstones. As such, he is a valuable colleague and advisor to me.

What is the importance of the VOICE event for the global jewellery trade, considering that it will be the first physical jewellery trade gathering since before lockdown?

EDWARD ASSCHER: The first physical trade gathering since the start of the crisis is certainly of considerable psychological importance, providing a visible indication that, even as the pandemic continues, we are learning to manage the situation and continue doing business. But this does not discount the fact many companies are suffering under current market conditions.

That VOICE is an international event is also significant, for a remarkable and almost unprecedented feature of the current crisis is that it has influenced all markets at the same time.

However, as always, there is light at the end of the tunnel – smaller inventories, pent-up demand and a future during which COVID-19 will slowly disappear, leading to a market recovery.

It will be the task of industry leaders to show the way. We need to be optimistic, but at the same time realistic.

INTERVIEW – Diamond inventories shrinking, boosting outlook for suppliers – World Diamond Council President