De Beers announces enhancements in SoC application process and Diamdel distribution

The strategy is a pilot plan
De Beers announces enhancements in SoC application process and Diamdel distribution

De Beers Group (De Beers) released details explaining its pilot plans to enhance its rough diamond distribution model. The changes are suggested for the upcoming Supplier of Choice (SoC) application process, and in the Diamdel distribution model.

The company maintains that the SoC will continue to be the primary method for distributing its rough diamonds, and that it will propose enhancements to the Diamond Trading Company’s (DTC) Intention to Offer (ITO) process.

The DTC will streamline the SoC application process for the 2012-15 contract period, with one simplified Contract Proposal Questionnaire (CPQ) required per applicant to cover multiple categories of goods. During the new SoC contract period, the DTC will re-plan future ITO allocations to better reflect individual Sightholder demand in the preceding ITO period.

Diamdel will continue to transfer more of its allocation into the auction format, simultaneously seeking to provide wider market access. While Diamdel auctions will continue to be a relatively small part of De Beers’ overall sales of rough diamonds, existing Diamdel customers, DTC Sightholders and, the wider market (which will be included over time), can participate in the auctions. The ability for DTC Sightholders to participate in Diamdel auctions will commence in October 2010 and will be extended to further qualifying diamantaires (in addition to existing Diamdel customers1 and DTC Sightholders) from April 2011. This will not impact DTC Sightholders’ ITO allocations. Also, Diamdel clients who demonstrate consistently strong demand for certain categories of rough at the auctions will, subject to availability, have the opportunity to compete for an ITO for those goods during the course of the 2012 - 2015 SoC contract period by being invited to submit a mid contract CPQ.

The plans are subject to ongoing assessment by De Beers and stakeholder feedback.

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