Maxim Shkadov, the president of IDMA, has cautioned the industry in a statement released to the press. He starts by saying that cutting and polishing sector is working with “a zero or negative margin” and that diamond manufacturing does not create added value. He warns that the current market structure has created a big bubble that has finally burst. He warns of “huge” quantities of goods in the market that harm the industry, and of a 'disconnect' between rough and polished prices.

Shkadov continues in the same vein that contrary to analysts’ views, there is no 20-25 per cent of added value to be had in the cutting and polishing of rough diamonds. Shkadov speaks of a drought in industry financing, a noteworthy drop in the demand for rough, and a polished supply which is too expensive and, save a few categories, much exceeds the demand in the downstream market.

Further elaborating the point, Maxim calls miners, “led by De Beers to come around” and conduct a “two-way” dialogue with the diamond manufacturers and traders and work hand in hand with the downstream market. “If the producers do not understand this, we all will lose our businesses and the destruction of the diamond industry and trade will be on their heads!”