A case study in modern diamond economics
ODED MANSORI | Tuesday September 23, 2025 12:14
It is a symptom of an industry that has spent decades avoiding hard truths. The diamond trade has clung to outdated models, papered over volatility with wishful thinking and treated inefficiency as a permanent feature rather than a fixable flaw. Now the cracks are showing.
For years, miners relied on tenders and auctions, systems that look efficient on paper but in practice resemble a casino. Rough stones are pushed into opaque markets where value is anyone’s guess. When global demand softens, as it has in cycles over the last decade, producers are left exposed. Workers pay the price, as in the case of Letseng, while shareholders watch assets decline. Yet the industry continues to act as though this volatility is simply the cost of doing business. It is not, it is a design failure.
And it’s not as though the warning signs weren’t visible. The rise of lab-grown diamonds reshaping consumer psychology, the steady erosion of trust in an industry long shrouded in secrecy to mention but a few. Instead of addressing these challenges with structural reform, much of the sector doubled down on short-termism i.e. squeezing labour, chasing marginal cost cuts and hoping the next demand rebound would bail them out. That’s not strategy, that’s denial.
This is where the Lucara–HB Antwerp partnership enters, not as a saviour but as a case study in innovation. It represents a conscious break with the old habits that left companies like Gem Diamonds exposed. At the heart of it is revenue alignment. Rather than gambling on rough sales in opaque auctions, Lucara ties its revenues to the eventual polished value of its stones. Predictability replaces roulette. Upside is shared rather than hoarded.
But let’s be clear: the real innovation is not financial engineering alone. HB Antwerp treats diamonds as finished luxury products, not commodities to be dumped into a black box. With advanced scanning, traceability systems and direct-to-market channels, HB creates a clear line from mine to final sale. That is transparency in action. In a sector that has thrived on opacity, this is less a tweak than a rebuke.
There is also a political economy dimension here. By embedding operations in Botswana, through local polishing, skills transfer and technology, HB is forcing the question that the industry has long dodged: why should producing nations be forever locked into the role of raw material exporters?
Botswana’s government as an example, has long argued for greater downstream value capture. Now, the technology and business models exist to make that a reality. The inertia of the old guard is the only thing standing in the way.
The industry likes to tell itself it faces an existential crisis. That narrative is wrong. What the industry faces is a transition. The choice is not between survival and extinction, but between clinging to self-inflicted inefficiencies or embracing models that align incentives, increase transparency and create real value at the source.
Gem Diamonds shows us what happens when the old system runs out of road. The Lucara–HB Antwerp partnership shows what happens when you stop pretending the casino is a strategy and start treating diamonds like the luxury assets they are. That’s not salvation. That’s adaptation. And in an industry this resistant to change, adaptation is radical enough.
*Mansori is co-founder and Managing Partner, HB Antwerp