The document summarizes the diamond supply chain from exploration and mining through cutting, polishing, and retail sale. Key aspects include: Diamond formation deep underground; mining through methods like open pit, hard rock, and marine; sorting by characteristics; specialized cutting and polishing centers; trading on bourses; setting into jewelry; and efforts to ensure ethical and conflict-free sourcing through organizations like the Kimberley Process and Responsible Jewelry Council.

1. DIAMOND SUPPLY CHAIN
MANAGEMENT
SUPPLY CHAIN
MANAGEMENT
OF THE
DIAMOND
PRESENTATION BY
MANISHA HALAI
MBA

2. DIAMOND INDUSTRY SUPPLY CHAIN
“ A diamond in the rough is very valuable. The
diamond supply chain consist of the diamond
exploration process,mining,sorting,cutting and
polishing,regulation,jewellery creation and the
selling of the final product.”

3. WHAT IS IT AND HOW IT WAS FORMED ?
• Pure Carbon
• Minerals within the rocks of the upper mantle of the
earth’s surface.
• 200 miles below earth’s surface
• Pressure greater than 50,000 times.
• Atmospheric pressure and
• Higher than 2500 degree Fahrenheit.

4. DIAMOND WITHDRAWAL METHODS
1. How the minerals are situated within the earth.
2. Steadiness of the material neighbouring the preferred material.
And
3. Non-essential damage done to the surrounding environment.

5. DIAMOND SUPPLY CHAIN

6. DIAMOND EXPLORATION AND EXCAVATION PROCESS
• First step;
 Geologists identify characteristics of the area where Diamond can be found.
 Careful study,planning,observation,testing are done before an area can be
excavated.
• Second step;
 Mining of these areas
GEOLOGISTS

7. FIVE TYPES ON MINING
Artisanal mining
a. Digging and shifting through mud or gravel river bank deposits.
b. little equipment and
c. No technology needed to mine.
d. Hard labour and long hours are necessary.
Hard rock mining technique
a. Miners built tunnel underground
b. Create underground rooms held up by rocks.
c. A shaft and declines are used to access the rooms
d. Specialized equipments requires more than Artisanal mining.
MARINE
MINING
Artisanal
mining
Tunnel

8. CONT.
MARINE MINING (Since 1990)
a. Employs both vertical and horizontal techniques
b. Extracts diamonds from offshore placer deposits.
c. Vertical marine mining uses a 6 to 7 meter diameter drill head to cut into the
seabed and
d. Suck up the diamond bearing material from the sea bed.
e. Horizontal mining employs the use of Seabed Crawlers ( remotely controlled
,CAT-tracked under water mining vehicle)
f. It moves across the sea floor pumping gravel up to an offshore vessel
(Diamond mines 2007)
g. More Specialized equipment than hard rock mining.
Marine mining

9. CONT.
OPEN PIT MINING
a. Extracting rock from the ground by taking away from an open
pit or hole.
b. Used when the deposit of materials are found near the
surface or along the kimberlite pipes
c. Used when the overburden or surface material covering
deposit ,is relatively thin and/or
d. Minerals are imbedded in structurally unstable earth that is not
suitable for tunnelling.
e. It’s Less dangerous than hard rock and marine mining.

10. CONT
Placer planning
a. Minerals are extracted from the surface of the earth.
b. No tunnels used.
c. Miners use water pressure ,special surface excavating
equipments
d. Or digging by hand to excavate the diamonds.

11. DIAMOND SORTING PROCESS
After the mining process, diamonds are sold to wholesalers,
• Sort the rough diamonds based on 16,000 individual categories of shape, colour, size and
carat .
Diamond shape are
• Round, marquise, emerald, princess, pearl, oval and heart
Diamond colours
• Appears colourless but may actually be slightly yellow or brown.
• Closer the stone is to colourless, the more valuable it is.
• Diamonds may be red,blue,green and bright yellow.
• Colour diamonds are called Fancy Diamonds.
• Scale ranks a Diamond’s colour on a scale from D (colourless) to Z (heavily tinted).
Rare colour Diamonds
• Black,blue,pale,pink,green,violet,and red etc.

12. DIAMOND CUTTING AND POLISHING
Diamond cutting requires
• Highly specialized artisans,tools,equipments and techniques.
• Few places in the world are specialized in diamond cutting and polishing.
Main Diamond cutting centres are ;
• Antwerp and Amsterdam, the Netherlands, Johannesburg, South Africa, New
York,and Israel.
• Due to low cost of labour , diamond cutting centres have been set up in
China, India and Thailand
• Cutting centres in Gujarat,
• India handles large number of small diamonds due to the cheap labour costs.
• Large diamonds in smaller quantities are send for cutting and polishing in
Europe and North America.

13. CONT.
• Cutting changes the rough diamonds into a processed Gem, ready for placement
in jewellery .
• Any mistakes at this point of supply chain will lead to repercussions in profitability
and supply.
• Planning stage of diamond cutting process is more important than the actual
cutting of the diamonds’
• A skilled cutter gets very few chances to make the right cut.
• Scanning device takes the picture of the rough diamond and shape is transmitted
into Q 3-D computer analysing program.
• Diamond shape is scanned into the computer and then the shape is analyzed.
• The market demand for certain shapes are considered while when cutting the
diamond.
• Larger diamonds are more expensive and giants higher profits,
• Cutters desires to produce very little waste during the cutting process.

14. CONT.
• The diamond rough go through a process called Cleaving when a rough
diamond is separated into smaller diamond pieces, to be finished separately.
Bruiting phase
• Two diamonds are set onto spinning axles turning in opposite directions to
grind against each other to shape each diamond into a round shape follows
cleaving.
• Facets are then cut into the diamond and
• the entire diamond is polished, cleaned in acids, and inspected for quality
• The diamonds must now be distributed to wholesalers and from there to
retailers.

15. DIAMOND EXCHANGE-BOURSES
Once the diamonds have been properly cut and polished;
• The diamonds are then sold on diamond exchanges called
bourses
• Currently 28 registered bourses in the world
• Diamonds are sold as loose diamonds or as diamonds already
set in jewellery.
World federation of Diamond Bourses (WFDB) 1947
• To unite and provide bourses trading in rough and polished
diamonds and precious stones with a common set of trading
practices.

16. CONT.
WFDB purpose
• To promote understanding and closer cooperation between
peoples all over the world who earn their livelihood in the
diamond and precious stones trade.
• To encourage the establishment of bourses with a view to
eventual affiliation.
• World diamond council, which is the body set by the world a
Federation.
• Works with 35 Governments ,the European Union and United
Nation to rid the industry of the scourge of conflict diamond.

17. CONT.
Before or after the diamonds are sold on the diamond exchanges the diamond
are set into fine pieces of jewellery.
Highly specialised job requires;
• Craftsmanship , equipment, and tools.
• Before a piece of jewellery can be created ,the design must be created.
• An artisan or craftsman renders designs on paper.
• Once all the details have been worked out and all the measurements have
been taken ,a wax mold is created to be used for the production of the
jewellery pieces that is later polished.
• Diamond designs and embellishments are then added to the metal pieces.

18. DIAMOND IN RETAIL STORE
• Retailers may purchase loose diamonds directly from the Bourses or
diamonds may be purchased after they have been set into jewellery.
• Jewellery is leading retail industry.
• Jewellery sales accounts $ 27 billion annually in sales in world
• 15% sales in US
Five categories of jewellery industry
• Bridal jewellery comprises of 30% of the market.
• Fashion jewellery is 25%
• Watches make up 18%
• Precious stone make up 15%
• Precious metals 15%

19. CONT
Jewellery has direct correspondences to the economic conditions;
• If economic conditions are good ,then people are willing to spend
more money on jewellery.
• No limit in purchasing jewellery in –store shopping
• Jewellers expanded their stores to the internet.
• Consumers may purchase and customize jewellery online
• Jewellery sales are affected by the seasons

20. CONT.
On market side of diamond distributors
• Switzerland ,Japan, and Thailand (largest export for US precious metals)
• UN is the largest purchaser of jewellery .
• 70% of the diamond market is controlled by the Beer Company that has
production and purchase agreements with most of the Diamond producing
countries (2006)
• Indian jewellers are world biggest source of polished diamonds.
• India exports 80% of diamonds quantity that accounts for 55% of dollar value
of the polished Diamond market.

21. CREATING MORE ETHICALLY RESPONSIBLE SUPPLY CHAIN
• To ensure that diamond being sold are not conflict diamond, individual
countries ,companies, and retailers have voluntarily set up additional
regulation and certification system
• Global efforts to ensure that diamonds on the market true fare trade
diamonds.
Kimberley Process(KP) 1 January 2003
• It outlines the rules that govern trade in rough diamonds.
• It sets minimum requirements that each participants must meet.
• Rough diamonds used by rebel movements to finance wars against legitimate
government and has fuelled decades of devastating conflicts in countries like
Angola,Cote d’Ivoire, the democratic Republic of the Congo, and Sierra
Leone.

22. CONT.
Kimberley Process Certification Scheme (KPCS)
• Imposes extensive requirements and must put in place national
legislation and institution; export, import and internal controls ;and
commit to transparency and exchange of statistical data.
• Participants can legally trade with other participants who have met
the minimum requirements of the scheme, and international
shipment shipments of rough diamonds must be accompanied by a
KP Certificate guaranteeing that they are “conflict free”

23. CONT....
• 2018-KPCS has 54 members ,
• Representing 81 countries including EU with 28 members.
KP held in Brisbane on 9-14-2017,
• Chair- European Union 2018
• Vice-chair-India 2018-19
Responsible Jewellery Council (RJC) 2005
• Group of 14 large Companies
• Trade groups in the Jewellery aims reinforcing confidence in the diamond
and
• Gold supply chain by having its members adhere to “responsible ethical
rights, social, environmental practice in a transparent accountable manner
(Choyt,2009)

24. CONT
• RJC has 140 members from various stages of supply chain(mining ,retail, gold hedging
,assaying )
• RJC’s certification scheme for the gold and diamond supply chain was finalized in
December 2009 .
• Citification shows that a company’s diamond and gold operations comply with the RJC’s
code of principles.
Examples
• The Canadian government has created the Canadian Diamond code of conduct ,which
which establishes a set of standards to be to be followed by the Canadian Diamond
retailers.
• Certified Canadian Diamonds are able to be traced back to both the mines and retailers.
• Diamonds that are not certified are easily able to be identified.