RAPAPORT... De Beers is expanding its forward-contracts program, enabling its short-term auction customers to fix a price for rough diamonds up to five months ahead of the stones' delivery.
Following the launch of the pilot program in January, De Beers said it had seen rising demand for its fixed-price mechanism, especially from businesses in Belgium, India and Israel. A total of 222 fixed-price forward contracts were sold during the pilot project, accounting for 10% of the revenue the auction business generated this year, the company reported.
“The results from this pilot have been very encouraging and have validated our understanding of customer needs and that the solution we have been testing meets those needs effectively,” said Neil Ventura, vice president of De Beers Auction Sales (pictured).
From January 2018, De Beers will offer its auction clients contracts with one-, two-, three-, four- and five-month forward deliveries.
“Coupled with the investments we have made to offer one of the industry’s most consistent product offerings, we are now ready to transition the fixed-forwards program to the next stage in its development by offering a broader range of highly consistent products over longer contract maturities,” Ventura added. |
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