Companies are not currently buying diamonds at an inflated price from De Beers

Mass reductions in the local diamond cutting industry of Botswana continue, as companies can not recover from the effects of high diamond prices and lack of liquidity.

According to information received by the publication BusinessWeek, Diacore, another local diamond cutting and polishing company, reduced 50 workers, bringing the total number of workers affected in the industry last year to about 1,000 people.

During the greatest prosperity in the industry there were about 3,700 workers. Companies that have recently reduced workers include Moti Ganz (100), Leo Schachter (100), Eurostar (100), Shrenuj (90) Safdico (30), Zebra (50), Dalumni, Tiffany (50), and Teemane (400) and the DMB closed the workshops. In the company polishing diamonds Diacore, who worked in Botswana for seven years, worked for about 130 people to reduce the number of workers to 80 people.

In an interview with BusinessWeek, Kfir Teichman, managing director of Diacore, admitted that his organization had cut staff, but denied reports of any plans to close its production.

"Yes, we are reducing employees. But we do not have any plans to close our production, and we are financially stable. That's all I can tell you, "he said. Employees of the company said that even those who managed to avoid this reduction of staff feel insecure about their future, as they were told to stay at home and wait for a call from the leadership.

"I received my package when I was reduced two weeks ago, unlike those who were told to just stay at home, because they are not even sure whether they will receive their monthly salary," said the dismissed employee on condition of anonymity. Sources from the industry say that of the 21 polishing and polishing enterprises in Botswana, more than half temporarily stopped activities and sent workers home.

"Companies are not currently buying diamonds at an inflated price from De Beers, so there is no work for workers. About 12 companies are not working now, although they continue to pay salaries to employees. These companies simply try to minimize their losses, because they can not buy diamonds at very high prices and cut and polish them at a loss. All sightholders who buy diamonds from De Beers, in fact, just export them without cutting and polishing, "said the chief executive of one local sightholder who asked to remain anonymous.

Because of the decline in diamond prices at high diamond prices, cutting and polishing companies around the world are currently facing a difficult situation in the local industry, which is exacerbated by relatively high labor costs.

On a site in Gaborone, De Beers reported its lowest sales since the financial crisis of 2008, as sightholders said that cutting and polishing diamonds at current prices for diamonds and diamonds is not profitable. The July site of De Beers closed with a preliminary cost of $ 200 million, and the amount of goods left on the table exceeded 65% of the initial cost of the site.

According to Rapaport News, the size of the July site this year is considered the smallest for the sixth De Beers site in the year since the global financial crisis of 2008.

Sources from the industry said that diamond prices rose 65% in the last three years, while polished prices either remained unchanged or fell by 15-20%.

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