Diamond industry welcomes DTC decision to extend SoC contracts

Diamond Trading Company (DTC), the marketing arm of De Beers, the South Africa-based company, which dominates the global supply of rough diamonds, has brought some cheer to the Indian diamond processing industry.

The company has decided to extend all existing supplier of choice (SoC) contracts by another year, a move that takes effect from 31 March 2011. De Beers supplies around 40 per cent rough diamonds into the global market with almost of these passing through India at some stage during their processing.

According to Vasant Mehta, chairman of the Gems & Jewellery Export Promotion Council (GJEPC), the apex diamond trade body in India said, it was a welcome decision as sightholders would get assured supply of roughs during the extension period.

The industry attributes the decision to the downturn in the sector due to the global economic slowdown. The extension, therefore not only applied to sightholders (the term for buyers of rough diamonds registered with the company, around 35 in India), but to all those with SoC contracts.

''By extending the current SoC by one year, we are providing both sightholders and non-sightholders with the time they need to focus on recovery,'' said Varda Shine, CEO of DTC at the 'Meet and Greet with Varda Shine' event in Mumbai on Monday.

''We welcome the interest shown by companies that wished to apply to become sightholders in 2011. We hope that they understand the necessity of our decision not to run an assessment in 2010. We look forward to engaging with them during the application process for the 2012-15 contract period, which will take place next year,'' Shine added.