After the rough diamonds are removed they are sorted and measured before being cut and polished. Before advanced sorting and weighing technologies were made available many of the sorting was subjective. The four main categories when sorting the rough diamonds are weight, shape, clarity, and color (Badkar 5). With better technology, the sorters are able to expertly divide the rough diamonds based on shape and weight. Color and clarity are slightly more difficult to divide when using machinery, which is why this step of the process is still carried out primarily by hand. The sorting process is so vitally important because, depending on the rough diamond’s characteristics, it determines the carat and cut of the diamond. In fact, there are up to 12,000 possible combinations that allow producers to evaluate the diamonds (Spektorvo 31).
Once the diamonds have been sorted and evaluated the producers sell it through three sales channels: long-term, short term, and auction contracts. The most used sales channel is long-term contracts, “…which account for about 65% of rough sales,” (Spektorvo 19). Long-term contracts can offer stability to pricing when others cannot (Spektorvo 15). It is an honor in itself to be admitted into the select company of long-term buyers, who must constantly meet large sales volumes and value. Short-term contracts are used to sell stones that do not make the typical size range, and makes up about 1% of rough-diamond sales (Spektorvo 28). Auctions, accounting for 30% of rough-diamond sales, are commonly used by smaller producers and often include unique stone sales as a test market (Spektorvo 24).
As seen in figure 6.8, the four main producers of rough diamonds are De Beers, ALROSA, Rio Tinto, and Dominion Diamond (Spektorov 8). The first step of producers are to strike a contract with buyers. Once a contract is reached, the producer matched a share of “… its output to the customer’s requirements,” (Spektorvo 25). This is actually a very important step because producers have a limited amount of output and must share among several customers. As of 2009, “…ALROSA leads the industry in volume, producing 34.4 million carats in 2012,” (Spektorvo 32). De Beers remains the leader in value terms; 5.5 billion in 2012 (Spektorvo 23).
Unfortunately, some of the diamonds that these producers sort and sale were sold used to help fund civil wars in Africa, ruining the lives of millions. Conflict diamonds are those “…sold in order to fund armed conflict and civil war,” (Conflict Diamonds). Profits from the sales are used by warlords to buy weapons in Angola, Democratic Republic of Congo, and Sierra Leone (Conflict Diamonds). Efforts have been made to prevent this from happening. For example, the Kimberley Process was put into action in 2003 which required all participants to certify that shipments of rough diamonds are conflict-free and a sales of receipt show that the money was not used for war purposes.