Facts and Froth Jill Lowe Are diamonds still forever?
The question asked is not in the endurance of any particular diamond but rather in the regard of value, scarcity, rarity and luxury of diamonds. When the timeless slogan “A diamond is forever” was coined in 1947 by Frances Gerety, a young copywriter at the advertising agency covering deBeers, this stroke of marketing genius switched the focus from the price of a diamond to the emotional concept of eternal love. Furthermore it reinforced the idea that the diamond should not be resold or bought for investment, underscoring the “forever.” The resulting “scarcity” and therefore the availability has been much like OPEC in dealing with oil availability. The complete control of supply of diamonds through the deBeers system DTC (Diamond Trading Company) enabled deBeers to stockpile inventory in a weak market to maintain stable but rising diamond prices. This could only be done by deBeers controlling the rough diamond supply, then mostly from Botswana. But in the last years of the 20th century, new world class mines were found in other countries, which began by-passing deBeers and selling directly to the market, resulting in a “supply and demand” pricing causing the price of diamonds to decrease. Furthermore, deBeers, (owned by Anglo American Company with Botswana) owns Debswana which produces the bulk of diamonds today. Recent changes in leadership in Botswana, have resulted in Botswana being interested in increasing its stake in Debswana. Today Anglo American is moving closer to spinning off or selling its diamond unit deBeers. The impact of lab diamonds cannot be forgotten either and this will be discussed below.