The masters of the diamond world are losing control

For decades, shopping for uncut diamonds was a tightly scripted affair: First, persuade De Beers to add you to its list of handpicked customers. Then, 10 times a year, attend a week-long sale to buy exactly the amount De Beers offers you at whatever price it chooses.

The system, which works more or less the same at Russian rival Alrosa, gave the two miners a tight grip on their market. With the coronavirus wreaking havoc through the industry, that control is now disintegrating.

De Beers struggled to generate much interest from its customers to even look at this month’s diamond sale, despite bending over backward to attract purchases, according to people familiar with the matter. At Alrosa, at least five buyers have broken from their long-term contracts because they can’t make money under the current terms, said the people, who asked not to be identified discussing private information.