A case study in modern diamond economics

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 The diamond trade has clung to outdated models, papered over volatility with wishful thinking and treated inefficiency as a permanent feature rather than a fixable flaw.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.