The diamond people: Changing faces in the trade of the world’s most precious gemstone
In the second of our three-part series on Antwerp as the world capital of diamond dealing, we find out why India has had such a major influence over the last few decades
Staying on top
It’s a joke, and yet, he would certainly do it if put to the test. He has placed a 7 carat diamond in my hand, so large and beautifully cut that it is rather priceless. But Leemans is a managing partner at diamond trader Silvius Druon, so he will surely find a buyer.
Silvius Druon is a trader and retailer located inside Diva, Antwerp’s diamond museum. Diva has a regular museum shop as well, but the Silvius space is where the more expensive jewellery is sold. I’m spirited up a flight of stairs to get a look at the 7 carat masterpiece after raising my eyebrows at a stone of 4.2 carats in the shop worth €85,000.
Leemans is one of thousands of diamond traders in Antwerp. And while he has a lovely spot inside the museum, most of the traders work out of the diamond district, located across from Central Station.
The diamond district is tiny and not at all flashy, contrary to the product that is moving through it on a daily basis. Antwerp’s industry is good for €42 billion in import and export business every year, or 86% of the world’s trade in rough diamonds. It is an extraordinary figure.
“Antwerp is the world leader, without a doubt,” says Margaux Donckier, head of PR at the Antwerp World Diamond Centre (AWDC). “There are stories in the media that Dubai is taking over, but it isn’t. Eighty-six percent of all rough diamonds – every diamond that is produced from a mine somewhere in the world – are coming to Antwerp and are traded here.”
Antwerp is good for 6,000 jobs related to the diamond industry, most of them traders – that is, the people who buy packets of diamonds from mines around the world, send them to be cut and polished, and then sell them on.
Thirty years ago, there was almost no competition outside of Antwerp. But with the rise of Dubai and India, there is a lot more
“But if you look at the indirect jobs,” says Donckier, “like shops and hotels and restaurants that are very dependent on the industry, then the total is more than 32,000 jobs.”
Smack dab in the middle of the diamond district, AWDC is the umbrella organisation for the entire industry in Antwerp, from trading to banking to promotion and communications. Marketing has become a big part of its function.
“Some 25 or 30 years ago, there was almost no competition outside of Antwerp. There was always Israel, but the two of us work very co-operatively. Over the last few decades, with the rise of Dubai, for example, and India, there is a lot more competition.”
And yet Antwerp has held on to its leading role – in large part because of India. While there are specific historical reasons why Antwerp became the leader in the world diamond trade, it’s the Indians who have influenced it the most over the last couple of decades.
The first rough diamonds burst out of the country’s volcanos in the 12th century, but Indian mines eventually dried up. The cheap and plentiful labour, however, means the country dominates the polishing industry.
When a rough diamond comes out of a mine, it looks very different to the one on your engagement ring. India has become specialised in cutting the stones and then polishing them – creating the shape and the facets that give them their trademark sparkle.
Along with trading, Antwerp used to lead the diamond cutting and polishing industry. “But now more than 90% of all diamonds are sent to India and Vietnam – low-wage countries – for cutting and polishing,” says Donckier.
Antwerp rode out the economic transition by increasing its number of traders. “It was first the Jewish community that made Antwerp a diamond capital, but it’s thanks to the Indians that we’re still the biggest.”
India started polishing diamonds in the 1960s, “but they noticed that if they wanted to get involved in the trade in diamonds, they couldn’t do it there. They didn’t have the knowledge or experience. They had to go to Antwerp to become diamond traders.”
So what did the Indian diamond families do? They sent sons, uncles and brothers across the world to break into trading in diamond capitals. “That’s why there are so many Indians in Antwerp.”
In total, there are 72 nationalities working in the diamond district. While the trade is dominated by the Jewish and Indian communities, “there are many Lebanese and Chinese people, as well as Africans and Belgians, of course,” says Donckier.
There are other trading hubs, “but Antwerp is still crucial because we are politically neutral,” she explains. “An Arab, for instance, can’t exactly go to Israel to trade. Here, it’s not a problem for an Indian to trade with an Israeli, an Arab or someone from China. That’s really the strength of Antwerp.”
How a diamond is traded
Diamond trading is a highly specialised job, and it’s tough to break in from the outside. Most of Antwerp’s traders are born into it.
The act of trading starts at the mine – largely in Africa, Russia or Canada – where diamonds are sorted into packets. Depending on the quality, they can be used specifically for industrial purposes or as precious gems. In Antwerp, they are only concerned with the latter.
The mine assesses what can be done with each stone and what quality the polished product is likely to be. It then sells the packets of rough stones to traders in Antwerp, who buy based on what their customers need.
They then have a few choices. They can sell them to major diamond retailers – such as Tiffany’s – who often have their own polishers. Or they can get them polished themselves by sending them off to India or Asia. Or they can get them polished in Antwerp.
One day we will run out of diamonds, absolutely
While Antwerp’s polishing industry is a sliver of what it once was, it is a crucial sliver. The largest and most perfect diamonds are often cut and polished here because the quality of the work is still considered the best in the world. The right polish can means tens of thousands of euros’ difference to the final product.
Some traders work for diamond companies, so the finished product might then leave the polisher to other parts of the world to be sold. But about half of all polished diamonds come back to Antwerp to be traded again. The traders carefully inspect the finished product and also get it officially graded.
This grade will ultimately decide how much the diamond is worth. There are many multi-national grading labs, but often countries have their own as well. “These labs decide on the four Cs – carat, colour, clarity and cut,” explains Donckier. “All the labs have their own standards. There is no general standard.”
One billion years in the making
If a trader is unhappy with a grade, then, they can go to another lab hoping for a better one. But that’s a risk, explains Donckier. “Grading costs money. So they only do it for diamonds of at least .3 carats because otherwise the cost of the grading is higher than what you’ll get for the diamond.”
And then, finally, the diamond is sold, either to another trader or to a retailer. Eventually, they wind up on products, such as jewellery and are sold to you and me.
And when you wear a diamond, you are wearing a billion years of geologic history; every diamond is more than one billion years old. “There was a big explosion in the centre of the earth, and that’s where the diamonds come from,” says Donckier.
So in fact, the diamonds coming out of mines today are the first – and the last. “One day we will run out of diamonds, absolutely.”
This is the second in a three-part series on Antwerp’s diamond industry. Part one explains how Antwerp became the hub of the world trade in diamonds, while part three takes a closer look at Diva, Antwerp’s stunning diamond museum
Photos from top: ©The Diamond Loupe, ©Bridgeman/BELGA