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| BALANCING PRODUCTION SHORTFALLS IN BOTSWANA |
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| 28 February 2013 |
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| CHAIM EVEN-ZOHAR |
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| Diamond producers each have different rough marketing mechanisms. Looking at world production by value, some 35-40 percent is sold through auctions and tenders. In these marketing systems producers simply sell whatever output they get - and don't face "shortfall" issues in their relationships with clients. Some producers sell in spot market deals or have "off-take" agreements with manufacturers or jewelers who have similar marketing mechanisms. However, the major producers - and foremost among them De Beers and Alrosa - still mostly sell their rough via long-term contracts, including sightholder systems, with prices often linked to auction markets. |
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