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The recent tender held by the Diamond Chamber revealed that the diamond selling system has not yet found its place in Russia. However, Russian diamond miners can learn to take advantage of the Americans' passion for fine diamonds.

The Russian diamond market has seen a remarkable event - not a single transaction was carried out at this year's first trade session at the Diamond Chamber. The Chamber executives explain this exclusively by time limitation - stating that sellers and buyers simply were not able to meet for the lack of time. In reality, however, it means that the system of diamond selling does not integrate into the Russian diamond market.

The Diamond Chamber was established in as early as in 1996 but did not start working until the middle of last year. The very name of the institution indicates that diamonds are not considered a commodity. A diamond is regarded as having currency value and therefore cannot be circulated at an exchange.

In 1999 the Diamond Chamber held five trading sessions, at which carried out were 24 transactions: 6 with rough diamonds and 18 with brilliants (total of $7.2 m). Russian participants ( Gokhran of RF, Alrosa, Sakhakomdragmet, lapidary plants of Moscow, Smolensk and others) prefer the selling side. The gems are generally bought by foreign participants, mostly by the US, Belgium and Israel companies. Thus, the management's dream of making the Chamber a Russian leading center of diamond trade and integrating into the world system is not likely to come true soon.

There are 22 diamond exchanges in the world, with four largest being in Antverpen ($23 billion of turnover). Presently, 85% of world diamond circulation is taking palce in this city. Rough diamonds get here mostly from Great Britain, Congo and Israel and brilliants - from India, the US, Hong Kong and Russia. Indian diamonds then go to the American market and Russian - to Japan and South-East Asia.

Apparently, it was the Americans who caused one more change - starting February 21st De Beers introduced another price rise on low-quality stones. The change is rooted in the demand increase. However, De Beers does not specify if purchasing prices will be raised too. The change is very favorable for Russia for almost a quater of all mined diamonds is fine diamonds. Their cutting is considered uneconomic for Russia and the flow is transferred overseas with India being the main cutter.

Source: Izvestia