Someone who read my blog on guiding principles said OK, that’s all very well but what are your guiding principles and those of your company? A fair comment and one that deserves a response.
First of all I think to add value to any business relationship you have to start off from a position of mutual respect which means you will automatically want to do the right thing for the client because whatever advice you offer, you know and they know it is offered in a spirit of constructive and confident engagement. We have always found that where the relationship is based on mutual respect and confidence communication is easy, effective and invariably productive in the long term. I have never wanted to represent or defend clients I didn’t genuinely like and believe in.
I have invariably found the closeness of the relationship evolves into a real friendship and nothing has given me greater satisfaction over the years than the enduring relationships I have had with my clients and colleagues both in India and other centres. Now that I am older and wiser I value these relationships more than ever and it is particularly gratifying to work now closely with the sons and nephews of the pioneers of the industry who, of course, have had the benefit of the best education that money could provide, whereas their fathers (several of whom started in this industry at a very young age) learnt everything in the much tougher ‘university of life’.
If you lose your respect for a client or company (and regrettably this can happen) then it is far better to concentrate on those companies for whom you retain respect and remain worthy of your full support.
A good broker is always acutely aware of each client’s individual sensitivities as well as their legitimate collective concerns about their own interests being properly represented.
A DTC broker, several years ago, unusually issued a formal and very public statement which received wide coverage at a time when the implications of Supplier of Choice was foremost on everyone’s minds stating that they had been appointed by the biggest US jewellery retailing group to assist them develop their manufacturing with a view to them becoming Sightholders. This, of course, hasn’t happened and a recent statement by the company involved confirmed that they were withdrawing from their manufacturing activity. However, let’s imagine the broker had been successful and I was one of their existing Sightholder clients I would have had very serious misgivings about them taking a position that sat so very uneasily with my own interests and in relation to those core diamond skills which rightly define Sightholder status.
The apparent lack of respect for their existing client base was the most striking thing about the statement, as well as the obvious opportunism of their intentions. We have now moved on into a much more realistic place and while we all accept that there are often definite advantages in vertical integration, when properly conceived and soundly based on core skills, this sort of band wagon approach is rarely the right reason to do something.
We have also been a company which never takes the view that only big is beautiful and we will always fight for a justifiable cause regardless of the size of our client’s business or the slickness of their presentations over the reality of their business.
Also I do sincerely believe that business should, whenever possible, be fun – one should enjoy the challenges and the people you work with. This encourages not only confidence but creativity and stiff over-formalised interchanges are not only uncomfortable but additionally are normally unproductive and unsatisfying. Normal human beings (and yes, I count myself as one) appreciate warmth and humour in their business interactions, which is why Mahiar Borhanjoo’s style of communication is appreciated and no one I know feels his humorous asides and banter diminish in any way his message or his astute business acumen and sound vision.
In short, our guiding principles remain to continue to always endeavour to do the right thing for the right reasons at the right time and thereby get it as right as possible for all our clients first of all and in doing that hopefully for ourselves too.
Friday, 18 December 2009
Tuesday, 15 December 2009
Monday, 12 October 2009
THE ‘DECOUPLING’ OF GOLD AND DIAMOND PRICES
In the 1980s world economic crisis the phenomena which came to be known as ‘stagflation’ led to a flight from conventional investment vehicles into alternatives gold, diamonds, fine art, antiques etc.
Gold has always been a refuge and safe haven, given the centrality of the gold market in the organisation of the economic and financial world and its obvious tradability.
Diamonds, while having always been considered a store of wealth, prestige and status had never been similarly perceived as an investment vehicle due to their lack of fungibility.
However, when a young entrepreneur named Martin Rapaport began codifying diamond colour and clarity grades into price grids based around the certification of diamonds the term ‘D Flawless’, originally a trade description, entered into consumer awareness and the 1ct D Flawless price became the benchmark for diamond price movement.
While diamonds and gold had always been the staple (and stable) items of jewellery manufacture, their perception as alternative investment vehicles took hold in the late 1970s when both rose to giddy and unsustainable heights only to collapse in the 1980s inflicting great damage on the diamond industry in particular.
Gold reached a high on January 21st 1980 of $850 an ounce, a record not overtaken until January 3rd 2008 and gold prices have just extended their record run above $1,060 a troy ounce up about 20% since the start of the year.
The diamond investment bubble of the 70s centred obsessively on the relentless commoditisation of the ‘D Flawless Carater’ through certification and sealed packaging, becoming respectable when mainstream financial houses added their endorsement by actively promoting and getting involved in the trading. The problem was that the trade in 1ct stones was distorting the whole market, rather as if the art market was suddenly only interested in Van Goughs to the exclusion of all other artists. This is probably what created a more dramatic bust in diamond prices than in gold prices because the price of the 1ct was pushed to such an extent that collapse was inevitable, even though the diamond business was enjoying it so much it was in blissful denial about the obvious risks.
By the end of 1980 the benchmark ‘D Flawless Carater’ had reached $62,000, 6 times the 1976 price and 39 times the 1970 price before falling back to a low of around $10,000 [Russ Shor] . It is hardly surprising that the perception of diamonds as in investment vehicle has only gradually recovered from this debacle. On the other hand, gold has undergone a similar trajectory since the 80s but is clearly very much back in favour.
One thing gold and diamonds have in common is that while they both are both perceived as store of wealth they are prized above all for their adornment value. However as we often see in India, gold’s biggest market, the consumer’s willingness to buy gold jewellery is very price sensitive and if prices rise too much gold jewellery sales suffer in spite of the fact that gold jewellery purchase is absolutely embedded in Indian culture.
Gold has always been a refuge and safe haven, given the centrality of the gold market in the organisation of the economic and financial world and its obvious tradability.
Diamonds, while having always been considered a store of wealth, prestige and status had never been similarly perceived as an investment vehicle due to their lack of fungibility.
However, when a young entrepreneur named Martin Rapaport began codifying diamond colour and clarity grades into price grids based around the certification of diamonds the term ‘D Flawless’, originally a trade description, entered into consumer awareness and the 1ct D Flawless price became the benchmark for diamond price movement.
While diamonds and gold had always been the staple (and stable) items of jewellery manufacture, their perception as alternative investment vehicles took hold in the late 1970s when both rose to giddy and unsustainable heights only to collapse in the 1980s inflicting great damage on the diamond industry in particular.
Gold reached a high on January 21st 1980 of $850 an ounce, a record not overtaken until January 3rd 2008 and gold prices have just extended their record run above $1,060 a troy ounce up about 20% since the start of the year.
The diamond investment bubble of the 70s centred obsessively on the relentless commoditisation of the ‘D Flawless Carater’ through certification and sealed packaging, becoming respectable when mainstream financial houses added their endorsement by actively promoting and getting involved in the trading. The problem was that the trade in 1ct stones was distorting the whole market, rather as if the art market was suddenly only interested in Van Goughs to the exclusion of all other artists. This is probably what created a more dramatic bust in diamond prices than in gold prices because the price of the 1ct was pushed to such an extent that collapse was inevitable, even though the diamond business was enjoying it so much it was in blissful denial about the obvious risks.
By the end of 1980 the benchmark ‘D Flawless Carater’ had reached $62,000, 6 times the 1976 price and 39 times the 1970 price before falling back to a low of around $10,000 [Russ Shor] . It is hardly surprising that the perception of diamonds as in investment vehicle has only gradually recovered from this debacle. On the other hand, gold has undergone a similar trajectory since the 80s but is clearly very much back in favour.
One thing gold and diamonds have in common is that while they both are both perceived as store of wealth they are prized above all for their adornment value. However as we often see in India, gold’s biggest market, the consumer’s willingness to buy gold jewellery is very price sensitive and if prices rise too much gold jewellery sales suffer in spite of the fact that gold jewellery purchase is absolutely embedded in Indian culture.
So you may say, this is all very well and interesting, but what is the conclusion? Well, if only I knew! However, I do definitely believe that we will see in these times of economic volatility that diamonds will be increasingly appreciated for their investment value as well as their scarcity. Of course they do have to be investment grade diamonds to qualify but the narrow definition of investment grade diamonds as being ‘D Flawless Caraters’ will hopefully never reoccur in the same way but while some people may be happy to have their gold ingots in the safe what sad person could possibly want to keep a beautiful and priceless diamond in a safe rather than where it belongs, around the neck or on the hand, or belly button (why not) of your beloved.
.
Finally, I do believe that the time for diamonds as an investment has come but I'm much less sure about the term 'investment diamonds'. Follow that if you can!?
Friday, 9 October 2009
ON CHAIM’S ‘DANGEROUS INDIAN BUBBLE’ AND THE DTC’s BUSINESS CONTINUITY POLICY
Chaim’s editorial in his latest (must read!) Diamond Intelligence Briefs portrays the recent Indian led mini boom in rough prices as a “dangerous bubble” rightly stating that it is driven by a combination of factory and production led demand and rough speculation rather than a hoped for revival of US polished demand.
Nothing really new here, a scenario which is quite familiar to us all (we’ve been there before). As usual the Indians (often it seems the problem but rarely seen to be the solution) get no credit at all for leading both the industry and the mines/producers out of the dire post Lehman Brothers crisis in our industry.
Chaim played a prominent role as moderator in the DTC’s Town Hall meetings held in Antwerp, Tel Aviv and Mumbai. How come in Mumbai (beneficiation the ‘elephant in the living room’ issue) the implications for the Indian industry of the African producers beneficiation policy was studiously ignored and did not feature as a prime topic of discussion in an open forum. Is it because of Chaim’s own views on beneficiation? Or a desire not to embarrass the hosts of the event?
Chaim also states in his piece that the “message from London” is that the “DTC will refrain from selling additional goods” which he explains as “ex-plan allocations”.
If this is to be the case (and I sincerely hope it won’t be) it would have serious implications for the business development of those Sightholders who believe the DTC Business Continuity programme is the only good thing to have emerged from the crisis period, a positive and appropriate response to distribution issues which has revived a lot of Sightholder confidence in the relevance and potential of Supplier of Choice and the validity of their own relationships with the DTC.
Nothing really new here, a scenario which is quite familiar to us all (we’ve been there before). As usual the Indians (often it seems the problem but rarely seen to be the solution) get no credit at all for leading both the industry and the mines/producers out of the dire post Lehman Brothers crisis in our industry.
Chaim played a prominent role as moderator in the DTC’s Town Hall meetings held in Antwerp, Tel Aviv and Mumbai. How come in Mumbai (beneficiation the ‘elephant in the living room’ issue) the implications for the Indian industry of the African producers beneficiation policy was studiously ignored and did not feature as a prime topic of discussion in an open forum. Is it because of Chaim’s own views on beneficiation? Or a desire not to embarrass the hosts of the event?
Chaim also states in his piece that the “message from London” is that the “DTC will refrain from selling additional goods” which he explains as “ex-plan allocations”.
If this is to be the case (and I sincerely hope it won’t be) it would have serious implications for the business development of those Sightholders who believe the DTC Business Continuity programme is the only good thing to have emerged from the crisis period, a positive and appropriate response to distribution issues which has revived a lot of Sightholder confidence in the relevance and potential of Supplier of Choice and the validity of their own relationships with the DTC.
Monday, 28 September 2009
AFRICA AND ALTERNATIVE PERSPECTIVES
Although disappointingly few people post replies or views to the blog (as I think is often the case) our statistics have established that we have a good and growing number of visitors, particularly in the US, UK, Belgium, Israel and India.
However the blog receives very few visitors from Africa or African producer countries. I recognise they probably feel they have more important things to do and achieve than read blogs, however I don’t believe it ever did anyone any real harm to read and consider views that do not necessarily conform exactly to their own, especially when they are well intentioned. Am I wrong that their apparent lack of curiosity about alternative views is slightly disconcerting?
However the blog receives very few visitors from Africa or African producer countries. I recognise they probably feel they have more important things to do and achieve than read blogs, however I don’t believe it ever did anyone any real harm to read and consider views that do not necessarily conform exactly to their own, especially when they are well intentioned. Am I wrong that their apparent lack of curiosity about alternative views is slightly disconcerting?
Thursday, 24 September 2009
THE LAND OF SACRED COWS
I found it amusingly ironic that in the FT article (reproduced below) on South African Beneficiation a South African lawyer described the policy as becoming ‘almost a holy cow’.
In the land of holy cows it is truly strange that the extraordinary benefits (beneficiation) to the Indian economy (particularly the states of Maharashtra and Gujarat) and more generally to the wider diamond industry, producers very much included, is so consistently and inexplicably undersold and under-recognised.
The Hong Kong show once again has demonstrated the huge importance of both the Chinese and the Indian trade and consumer markets. How come when everyone seems to recognise and appreciate the importance of these markets that the Indian manufacturing industry is taken so much for granted when you consider it is the prime driver for the significant and exciting development of these markets and their success in the future.
MINING INDUSTRY REMAINS DIAMOND IN THE ROUGH
By Tom Burgis
Published: July 16 2009 16:14 Last updated: July 16 2009 16:14
The laboratory’s fittings and microscopes glisten almost as brilliantly as the diamonds themselves. Under the watchful instruction of expert foreign cutters, locals perfect stone after precious stone. With every tweak of their tools, the cutters ensure that a greater share of the gems’ value accrues to the African country from whose soil they were plucked.
It could be a sparkling example of South Africa’s management of its bounteous minerals. The problem – at least for the new government in Pretoria – is that the state-of-the-art cutting factories lie over the border in Botswana.
“Beneficiation”, as the process of refining metals and minerals that would otherwise go abroad in cheap, raw form, is a hot topic across the continent. Botswana, long a model resource-dependent nation, has led the way with its new diamond park.
South Africa is blessed with as much mineral wealth as any other state on earth. It already has some downstream mineral manufacturing, most notably in platinum. Now it wants to go much further but its attempts to enact a notoriously difficult shift in a volatile industry – and to do so in the teeth of a commodity crash – have unnerved the private sector.
More than a century after its first diamond and gold rushes, most of the country’s minerals still depart for smelters and sorting houses based overseas.
On paper at least, the government wants to change this. At its most recent five-yearly party congress, held in November 2007 in Polokwane, the ruling African National Congress passed a resolution in favour of such a shift.
And in a speech to launch a draft beneficiation strategy in March, Buyelwa Sonjica, then mining minister, said: “The trading structure of our mineral commodities is essentially premised on a model that sought to sustain a colonialist political configuration and serve its agenda.”
As the draft strategy notes, in 2007, South African minerals generated gross revenues of R225bn($27bn). Even though they only amounted to 10 per cent of the total of rough minerals mined, those resources that processed minerals were far more lucrative, bringing in R40bn.
The initial goal is to wring greater revenue from 10 commodities ranging from gold, and platinum to coal and iron ore by nurturing local jewellery, pigment, steel and vehicle sectors and by improving self-reliance in energy.
The state will offer incentives and might take unspecified measures to encourage demand for processed South African wares from big importers of raw materials, especially China.
If progress is not satisfactory, however, “regulatory levers will be applied”, says Mosa Mabuza, the top official at the mining ministry. “The industry has a responsibility to ensure that, once an environment is created for manufacturers, we ensure them security of supply.”
However, the policy has private sector critics worried. Beneficiation “has almost become a holy cow”, says Peter Leon, a partner who heads the natural resources and regulatory practice at law firm Webber Wentzel and current chair of the International Bar Association’s mining committee. “You have to be careful how far you push it.”
Detractors argue that as a potential processing centre, South Africa enjoys no real comparative advantage. It may have abundant minerals but, when it comes to skills, a reliable power-supply and sweeteners for investors, it looks distinctly unattractive compared with existing manufacturing centres.
In diamonds, for example, while the country already processes some top-of-the-range stones, Stephen Lussier, a De Beers executive, says: “It can’t survive if they have to cut the lower-cost stones. The labour costs are much lower in India.” Nonetheless, the government has created a state diamond trader in order to make all the country’s diamonds available for local processing.
Roger Baxter, chief economist at the Chamber of Mines, says: “The subject is very emotive as there is the perception among some policymakers that the mining companies continue to export all the raw materials to London and that all the jobs in downstream processing are forfeited to the old colonial powers.
“But this perception is simply not based on reality. Where the commercial opportunities exist, there is ‘value-adding’ taking place.”
Mr Baxter argues that the reason South Africa refines all of its platinum and accounts for 15 per cent of catalytic converter manufacturing worldwide is not because 60 per cent of global supply of the resistant metal comes from under its northern plains but because of the incentives that created the downstream industry.
That manufacturing across the board as a share of gross domestic product is steadily declining indicates, he says, that the government has yet to come up with an industrial policy that makes beneficiation of other minerals commercially worthwhile.
In any event, as the government of Jacob Zuma – now in its third month in office – takes shape, the policy is likely to be implemented. Recalling the development of South Korea last century or the UK the one before, the mining ministry’s Mr Mabuza says: “There is a natural progression from having resources to manufacturing. But sometimes you have to make things happen.”
He adds: “Our resources are diminishing. While we have those resources, we have to make a quantum leap.”
In the land of holy cows it is truly strange that the extraordinary benefits (beneficiation) to the Indian economy (particularly the states of Maharashtra and Gujarat) and more generally to the wider diamond industry, producers very much included, is so consistently and inexplicably undersold and under-recognised.
The Hong Kong show once again has demonstrated the huge importance of both the Chinese and the Indian trade and consumer markets. How come when everyone seems to recognise and appreciate the importance of these markets that the Indian manufacturing industry is taken so much for granted when you consider it is the prime driver for the significant and exciting development of these markets and their success in the future.
MINING INDUSTRY REMAINS DIAMOND IN THE ROUGH
By Tom Burgis
Published: July 16 2009 16:14 Last updated: July 16 2009 16:14
The laboratory’s fittings and microscopes glisten almost as brilliantly as the diamonds themselves. Under the watchful instruction of expert foreign cutters, locals perfect stone after precious stone. With every tweak of their tools, the cutters ensure that a greater share of the gems’ value accrues to the African country from whose soil they were plucked.
It could be a sparkling example of South Africa’s management of its bounteous minerals. The problem – at least for the new government in Pretoria – is that the state-of-the-art cutting factories lie over the border in Botswana.
“Beneficiation”, as the process of refining metals and minerals that would otherwise go abroad in cheap, raw form, is a hot topic across the continent. Botswana, long a model resource-dependent nation, has led the way with its new diamond park.
South Africa is blessed with as much mineral wealth as any other state on earth. It already has some downstream mineral manufacturing, most notably in platinum. Now it wants to go much further but its attempts to enact a notoriously difficult shift in a volatile industry – and to do so in the teeth of a commodity crash – have unnerved the private sector.
More than a century after its first diamond and gold rushes, most of the country’s minerals still depart for smelters and sorting houses based overseas.
On paper at least, the government wants to change this. At its most recent five-yearly party congress, held in November 2007 in Polokwane, the ruling African National Congress passed a resolution in favour of such a shift.
And in a speech to launch a draft beneficiation strategy in March, Buyelwa Sonjica, then mining minister, said: “The trading structure of our mineral commodities is essentially premised on a model that sought to sustain a colonialist political configuration and serve its agenda.”
As the draft strategy notes, in 2007, South African minerals generated gross revenues of R225bn($27bn). Even though they only amounted to 10 per cent of the total of rough minerals mined, those resources that processed minerals were far more lucrative, bringing in R40bn.
The initial goal is to wring greater revenue from 10 commodities ranging from gold, and platinum to coal and iron ore by nurturing local jewellery, pigment, steel and vehicle sectors and by improving self-reliance in energy.
The state will offer incentives and might take unspecified measures to encourage demand for processed South African wares from big importers of raw materials, especially China.
If progress is not satisfactory, however, “regulatory levers will be applied”, says Mosa Mabuza, the top official at the mining ministry. “The industry has a responsibility to ensure that, once an environment is created for manufacturers, we ensure them security of supply.”
However, the policy has private sector critics worried. Beneficiation “has almost become a holy cow”, says Peter Leon, a partner who heads the natural resources and regulatory practice at law firm Webber Wentzel and current chair of the International Bar Association’s mining committee. “You have to be careful how far you push it.”
Detractors argue that as a potential processing centre, South Africa enjoys no real comparative advantage. It may have abundant minerals but, when it comes to skills, a reliable power-supply and sweeteners for investors, it looks distinctly unattractive compared with existing manufacturing centres.
In diamonds, for example, while the country already processes some top-of-the-range stones, Stephen Lussier, a De Beers executive, says: “It can’t survive if they have to cut the lower-cost stones. The labour costs are much lower in India.” Nonetheless, the government has created a state diamond trader in order to make all the country’s diamonds available for local processing.
Roger Baxter, chief economist at the Chamber of Mines, says: “The subject is very emotive as there is the perception among some policymakers that the mining companies continue to export all the raw materials to London and that all the jobs in downstream processing are forfeited to the old colonial powers.
“But this perception is simply not based on reality. Where the commercial opportunities exist, there is ‘value-adding’ taking place.”
Mr Baxter argues that the reason South Africa refines all of its platinum and accounts for 15 per cent of catalytic converter manufacturing worldwide is not because 60 per cent of global supply of the resistant metal comes from under its northern plains but because of the incentives that created the downstream industry.
That manufacturing across the board as a share of gross domestic product is steadily declining indicates, he says, that the government has yet to come up with an industrial policy that makes beneficiation of other minerals commercially worthwhile.
In any event, as the government of Jacob Zuma – now in its third month in office – takes shape, the policy is likely to be implemented. Recalling the development of South Korea last century or the UK the one before, the mining ministry’s Mr Mabuza says: “There is a natural progression from having resources to manufacturing. But sometimes you have to make things happen.”
He adds: “Our resources are diminishing. While we have those resources, we have to make a quantum leap.”
Copyright The Financial Times Limited 2009.
Friday, 28 August 2009
ON ‘SUSTAINABLE RELATIONSHIPS’, ‘GUIDING PRINCIPLES’ AND AUCTIONS!?
The word sustainable has become almost obligatory usage in relation to policies or behaviour that are seen to be socially, politically or environmentally accountable and responsible as opposed to that which is seen to be exploitative, cynical, predatory.
However, we should not forget that ‘sustainable business’ is only achievable and credible when supported by sustainable relationships (enduring relationships). This requires not only shared aims and objectives but shared values based on mutual respect and confidence in the longer term, rather than relationships overly restricted and restrained by contract periods or short term business prospects.
While we all need to adjust and adapt to the challenges life and business presents, which have been particularly testing for us all for almost a year now, those who talk loudest about guiding principles are the ones who often seem to be least inclined to observe them.
While the social cohesion and entrepreneurial culture of our industry has been the driver of its success the reverse side of this positive is an unappealing sub-culture of gossip, innuendo, misinformation and intrigue which has never served the industry particularly well. Difficult times generally bring the industry closer together but as things improve some of the least appealing habits seem to come to the surface again, and this is hardly ‘living up to diamonds’.
Similarly, the discussion around auctions or competitive bidding for rough and whether it adds value in the long term attracts a lot of posturing and frankly rather absurd (thinking out of the box?) comments from people who should (and in fact do) know better. While it is undoubtedly appropriate for spectacular polished stones to be auctioned in the rarefied atmosphere of Sotheby’s, Bonham’s and the like, auctioning boxes of Grey Rejections or 5-10s simply is not an option if sustainability is accepted as an essential prerequisite of a stable and confident business.
Why should anybody in their right mind commit to manufacturing or marketing such difficult goods if they were not assured of a proper long-term commitment from their supplier? One accepts that to make up a box of Argyle Pinks and pretend that that is a wholesale or volume business would be ludicrous but to claim that all diamonds and producers would benefit from auction driven transactions completely flies in the face of our experience in the industry and the real meaning of sustainability in terms of manufacturing, marketing and commitment. It would indeed be extraordinary and inexcusable, not to mention ironic, for us not to have learned the lessons of our own history.
However, we should not forget that ‘sustainable business’ is only achievable and credible when supported by sustainable relationships (enduring relationships). This requires not only shared aims and objectives but shared values based on mutual respect and confidence in the longer term, rather than relationships overly restricted and restrained by contract periods or short term business prospects.
While we all need to adjust and adapt to the challenges life and business presents, which have been particularly testing for us all for almost a year now, those who talk loudest about guiding principles are the ones who often seem to be least inclined to observe them.
While the social cohesion and entrepreneurial culture of our industry has been the driver of its success the reverse side of this positive is an unappealing sub-culture of gossip, innuendo, misinformation and intrigue which has never served the industry particularly well. Difficult times generally bring the industry closer together but as things improve some of the least appealing habits seem to come to the surface again, and this is hardly ‘living up to diamonds’.
Similarly, the discussion around auctions or competitive bidding for rough and whether it adds value in the long term attracts a lot of posturing and frankly rather absurd (thinking out of the box?) comments from people who should (and in fact do) know better. While it is undoubtedly appropriate for spectacular polished stones to be auctioned in the rarefied atmosphere of Sotheby’s, Bonham’s and the like, auctioning boxes of Grey Rejections or 5-10s simply is not an option if sustainability is accepted as an essential prerequisite of a stable and confident business.
Why should anybody in their right mind commit to manufacturing or marketing such difficult goods if they were not assured of a proper long-term commitment from their supplier? One accepts that to make up a box of Argyle Pinks and pretend that that is a wholesale or volume business would be ludicrous but to claim that all diamonds and producers would benefit from auction driven transactions completely flies in the face of our experience in the industry and the real meaning of sustainability in terms of manufacturing, marketing and commitment. It would indeed be extraordinary and inexcusable, not to mention ironic, for us not to have learned the lessons of our own history.
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