DIAMOND MARKETING
While there is considerable give-and-take in the entire colored-stone marketing process, such is not the case with the diamond whose fate is closely regulated from mining to cutting. About 85 per cent of the world’s production of diamonds is controlled by the De Beers Syndicate which began its remarkable career many decades ago in the Union of South Africa. Not only does the syndicate control production through a miners’ association, with each mine being assigned an annual production quota, it also requires the miners to sell to a centralized buying organization which assembles all of the rough and markets it in a standard, undeviating procedure.

The problem of disposing of the poor as well as the good grades of gem-quality diamonds is solved by carefully estimating the demand for cut gems in world markets and the prospective consumption of diamond crystals by individual customers, for each of whom a parcel is prepared containing crystals of all sizes and qualities. The customers are notified  when their parcel is ready and they travel to London to the selling organi¬zation headquarters to inspect their parcel in a ceremony known as a ’sighting.” Customers have the choice of accepting or rejecting the parcel, but mostly they accept. They may now cut all of the crystals or sell off parts of the parcel which they do not desire for themselves.

Thus the rough is carefully released to precisely satisfy the demand and to prevent a glut of diamonds on the market which would depress prices.
While this monopolistic practice may be abhorrent to those who believe in free trade, it does have the merit of smoothing out fluctuations in prices and thereby confers a remarkable stability to the gem diamond industry and an assurance of a certain minimum value to each diamond sold. Specific rules formulated by the Federal Trade Commission to pro¬tect buyers of cut diamonds