The Diamond Producers Affiliation, or DPA, was fashioned in 2015 through an alliance between seven diamond producers: Alrosa; De Beers; Dominion Diamond Mines; Gem Diamonds; Lucara Diamond Corp.; Murowa Diamonds (owned and operated by RZM); Petra Diamonds, and Rio Tinto.
From the launch, the DPA’s objective is to “maintain and enhance consumer demand for, and confidence in, diamonds,” which is a mission that affiliation management stated additionally features a dedication to “best-in-class ethical and sustainable operations and transparent business practices.”
[Click on on this hyperlink to obtain a free WWD Studios Govt Briefing Report, “The Diamond Dossier.”]
Right here, Jean-Marc Lieberherr, chief government officer of the Diamond Producers Affiliation, explains what that mission entails in addition to the challenges confronted by the DPA in implementing it.
WWD: How would you describe the present state of the diamond manufacturing trade?
Jean-Marc Lieberherr: Following a robust 2017 and agency 2018, worldwide diamond jewellery market progress has been slowing down in 2019 largely because of financial uncertainty and short-term market components, particularly in China and India. Analysis exhibits that diamond desirability amongst customers is excessive in all key markets, and we count on China and India to be future progress engines as desirability interprets into purchases past primary cities.
This, mixed with decrease manufacturing ranges of tough diamonds, will end in sturdy costs all through the worth chain. Within the quick time period, financial uncertainty and comparatively low confidence are weighing in the marketplace, which is adapting by lowering output ranges. It is a wholesome enterprise dynamic.
WWD: What have been a number of the challenges that the DPA confronted since forming in 2016, and the way has the affiliation addressed it?
J-M.L.: The primary problem was to safe advertising budgets and construct from scratch a world advertising group that may influence the best way customers take into consideration diamonds, particularly youthful customers. Since mid-2017, now we have secured a large finances for our actions and have opened places of work in Mumbai and Shanghai, along with our New York workplace, which opened in 2016.
Our first objective was to develop a world communications platform that may resonate with customers worldwide. “Real Is Rare, Real Is a Diamond” is constructed upon our insights that buyers search authenticity of their life, their relationships and the merchandise they purchase and put on — and what’s a greater image of authenticity than a three billion-year-old diamond?
We’re nonetheless originally of the journey, however we’re discovering that this platform resonates very strongly with customers. We are going to quickly launch a brand new world marketing campaign that tells this story in a really modern and impactful method.
One other problem we face is the antiquated perceptions concerning the diamond trade and the influence of diamond mining. To appropriate this widespread misinformation we commissioned an unbiased analysis firm, Trucost, a part of S&P International, to quantify the collective socioeconomic and environmental influence of diamond mines operated by DPA members, collectively representing 75 p.c of world manufacturing.
[Related story: Mined vs. Lab-Grown: Diamond Debate Heats Up]
We issued a report titled “Total Clarity” that corrects lots of the myths and misconceptions about diamond mining, highlights our constructive influence on native communities and clarifies the truth of our environmental footprint, additionally relating that of laboratory-grown diamonds.
The report additionally identifies alternatives for steady enchancment which we’re appearing upon.
WWD: With the phrases “recession” and “global economic slowdown” being bantered about, is there concern within the DPA a few downturn? Or is the trade extra resilient to recessions?
J-M.L.: The DPA’s work is long run in nature. Diamond miners make a long-term dedication to the diamond trade because it takes years of funding to develop a brand new diamond mine, and the DPA’s work is a part of that long-term dedication. A potential financial slowdown doesn’t influence our strategy and if something encourages us to extend our funding to be in a robust place when the financial system picks up once more.
The diamond trade will not be proof against financial circumstances, and persevering with to construct client confidence within the inherent, lasting worth of a pure diamond is central to our work. Not like laboratory-grown diamonds — which could be produced in limitless portions, haven’t any base for worth and are subsequently certain to see their costs decline very considerably as further capability is introduced on line and know-how matures — pure diamonds are finite and inherently valuable, which permits them to uphold worth.
It makes diamonds comparatively extra resilient to a downturn than different merchandise.