Diamond Industry Faces Crisis: Calls for Reform in Sales Processes
By Reuters
Published: September 18, 2025
The diamond industry is currently grappling with a significant downturn, prompting calls for a comprehensive overhaul of its sales processes. Oded Mansori, co-founder and managing partner of HB Antwerp, a prominent gem trading company based in Belgium, has voiced concerns regarding the inefficiencies and lack of transparency in the current tender and auction systems. He argues that these outdated methods are detrimental to producers, particularly in light of the ongoing price slump affecting the market.
Current Market Challenges
The diamond market is experiencing a prolonged period of decline, exacerbated by global economic uncertainties and the increasing popularity of lab-grown diamonds. This shift in consumer preference has led to reduced demand for natural stones, impacting producer countries like Botswana, which have seen a significant drop in revenue. The situation has forced several mining companies, including Burgundy and Lesotho’s Letseng mine, to implement layoffs, further highlighting the industry’s struggles.
Mansori’s critique of the current sales methods is particularly pointed. He describes the existing tender and auction systems as resembling a “casino,” where the value of rough stones is often uncertain. “For years, miners relied on tenders and auctions, systems that look efficient on paper but in practice resemble a casino,” he stated. This lack of clarity leaves producers vulnerable, especially during periods of reduced global demand, which have become more frequent over the past decade.
The Inefficiencies of Current Sales Methods
Traditionally, rough diamonds are sold through competitive bidding, where buyers submit confidential bids for individual stones or parcels. While this system may appear efficient, it often results in a lack of transparency and predictability. Mansori argues that this opacity can lead to significant financial losses for producers, as they are left to navigate a market where the value of their products is uncertain.
The impact of these inefficiencies is felt most acutely by workers in the industry. As revenues decline, job security diminishes, and many find themselves facing layoffs. “Workers pay the price, while shareholders watch assets decline,” Mansori lamented, emphasizing the human cost of the industry’s current trajectory.
A New Approach to Diamond Sales
In response to these challenges, Mansori advocates for a shift in how diamonds are sold. He proposes a model where producers’ revenues are linked to the eventual polished value of their stones, rather than relying on the unpredictable outcomes of rough sales in opaque auctions. This approach could provide a more stable revenue stream for producers, allowing them to better weather market fluctuations.
Under HB Antwerp’s partnership with Lucara Diamond Corp, the company purchases high-quality stones (10.8 carats and above) from Lucara’s Karowe Mine in Botswana. The prices are based on the estimated polished value of each diamond, rather than the uncertain auction prices. This innovative model has proven successful; HB Antwerp accounted for 72% of Lucara’s $74 million diamond revenue in the first half of 2025, a notable increase from 65% the previous year. Mansori claims that producers could potentially earn up to 40% more revenue by adopting this profit-sharing model.
Historical Context and Future Implications
The diamond industry has a long and storied history, often characterized by cycles of boom and bust. The current crisis is considered one of the most severe in the industry’s history, with many experts drawing parallels to previous downturns. However, the unique challenges posed by the rise of lab-grown diamonds and changing consumer preferences make this situation particularly complex.
Historically, the diamond market has been dominated by a few key players, leading to a lack of competition and innovation. The current crisis may serve as a catalyst for change, pushing the industry to adopt more transparent and efficient sales methods. As consumer awareness grows and preferences shift, the industry may need to adapt to survive.
Conclusion
The diamond industry stands at a crossroads, facing unprecedented challenges that threaten its very foundation. As Oded Mansori highlights, the current sales processes are outdated and inefficient, leaving producers vulnerable in a rapidly changing market. By embracing new models that prioritize transparency and link revenues to the polished value of stones, the industry could not only survive but thrive in the future. The call for reform is not just about improving profits; it is about ensuring the sustainability of an industry that has captivated consumers for generations.
