Monday, September 21, 2020

DTC Botswana’s first diamond sale a success

The Management of the newly launched Diamond Trading Company Botswana (DTCB) said this week that the historic first-ever sale of aggregated diamond mix to take place in the country was a success. In an interview with The Sunday Standard, DTCB management team, represented by Head of Sales and Marketing, Toby Frears, and Corporate Communications and Public Affairs Manager, Kago Mmopi, said the first sale, which ended this past Monday, surpassed their expectations.

“Putting up a new sale is in itself an enormous exercise. It involves a lot of things, ranging from security, catering, insurance and other logistics. You should also know that there are a lot of stakeholders involved. Apart from sight-holders, we also had officers from government,” explained Frears.

What was more intriguing about this particular sale, he said, was that there were also new people involved in the actual, which commenced last week Tuesday and ended this past Monday.
“I had a team of Key Accounts Managers, Boitumelo Nyanga and Mbuya Ntabe ÔÇô who are citizens and were also responsible for the sale. As part of skills transfer, we had to train them for a year in London,” he explained.

Frears said the sale made a positive impression on sight-holders. He explained the confusion that nearly ensued as a result of the sales that were running simultaneously in London and Botswana. He said the sightholders had a week to shuttle between Botswana and London to view the precious stones and that, in the diamond industry, things are usually pre-arranged.

“Everything is planned for in advance. At the beginning of the year, we sit down with our clients and they tell us their expectations ÔÇô so there are barely any surprises in each sale. We already know what quantities are needed for a year that is why we say this year we would be supplying sight-holders with US$375 million worth of diamonds. We plan the shipping arrangements on time and during the sale, the clients would be coming to view their goods and determine whether they meet their expectations,” he said.

The sightholders, he said, bring to the sight their own valuers. He said the year plan arrangement allows for smooth production in factories.
“Everybody wants certainty. When they know in advance what they would be getting a year ahead, it allows for better manufacturing plan and marketing,” he explained. The first sale saw 14 companies attending the sight-seeing out of the 16 locally registered diamantaires. The 16 locally registered companies are, together with other 63 De Beers associated diamantaires, operating on a three year contract. The 79 customers with exclusive right to buy De Beers diamonds until March 2011 run a year cycle that begins in April and ends in March ÔÇô under which 10 sales are conducted. Effectively, it means after every five weeks, diamond moguls would converge in Gaborone to view the aggregated mix of rough stones. Frears said plans are at an advanced stage to move aggregating from London to Botswana, possibly by the end of next year, the mixing would be done in the country.

The first DTCB sale was a mixture of a consignment ferried to London ÔÇô a blend sourced from producer countries such as Russia, De Beers own mines in South Africa and joint venture partnerships in Botswana, Namibia and Tanzania.

Frears said the plan is to sell rough stones that are economically viable to the 16 locally registered sight-holders in order to sustain the beneficiation initiative.

“We would, in three years, sell a range of goods that are economical to manufacture to sightholders who show commitment to job creation and skills transfer,” he added.

In the past, De Beers was accused of pursuing the ‘can’t be done’ agenda in Sub Sahara Africa by selling small and low value stones to resident cutting and polishing firms. There were four in Botswana, before a wave of beneficiation, and all were struggling to survive ÔÇô a thing that De Beers used as a trump card. Now, with the blessing of the diamond giant, there is optimism that beneficiation would be a dream come true for producer countries. For Botswana in particular, the sightholders that have set up shop here are some of the best in the world, with proven track records that span years and have access to the latest technology. It now remains for other sectors, such as the banking and insurance industry to follow suit as primary downstream beneficiaries of the diamond beneficiation.

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Digital copy of Sunday Standard issue of September 20 - 26, 2020.