A recent article written by diamond analyst Paul Zimnisky on Solitaire, an B2B gem and jewelry magazine published by India’s Gem and Jewellery Export Promotion Council (GJEPC), examines how a “new-found level of transparency” is expected to change the diamond industry’s supply chain within the next five years.
Zimnisky begins by examining the GIA’s new Source Verification Service which, as noted in a recent press release published by the Gemological Institute of America, is granted only to manufacturers that go through a vetting process by an independent auditing firm to confirm that they can “successfully track a diamond from receipt of the rough diamond through the entire manufacturing process.”
This move, he says, can be reasonably linked, in terms of timing, with the sanctions imposed on Russian diamonds by the US earlier in the year. While direct sanctions prohibit only the direct importation of new Russian rough or polished diamonds into the US, many major industry players, among them LVMH, Richemont and Signet Jewelers have announced that they will not source any diamonds of Russian origin for the time being.
The industry’s supply chain is therefore under pressure to “segregate Russian and non-Russian goods to effectively cater to their respective clients.”
In addition, in May, De Beers’ Tracr “blockchain platform”, which “provides “provenance assurance for 100% of De Beers diamonds from source to Sightholder to store,” was finally deployed at scale. Currently, it registers as much as a quarter of De Beers production by value, according to Zimnisky. According to the company, while Tracr is currently a business-to-business platform, it will eventually be integrated with De Beers’ the end-consumer-directed service – its “Code of Origin” initiative.
This “new-found level of transparency,” says Zimnisky, is a new emphasis which will change the diamond industry’s supply chain. According to the author, “starting with primary stones, i.e. “centre-stones,” and eventually followed by secondary stones, many consumers will know the source of their diamonds, just as they do the carat, colour, clarity and cut.”
Read the full article here.
