25 Oct How do you find diamond traders in Dubai?
If you want to find reputable diamond traders in Dubai, you should be in luck because the city plays a key role in the world diamond trade.
Dubai boasts some of the world’s most modern facilities, it is the regional distribution centre for the Middle East and it is the only legal entry and exit point for rough diamonds in the UAE.
Your starting point for finding a reputable dealer should be the Dubai Metals and Commodities Centre, which is home to the Dubai Diamond Exchange (DDE).
DDE is key for diamond traders in Dubai
The DDE is located in Almas Tower, which itself is home to over 1,000 regional and international precious gems companies, as well as the Dubai Gems Club and the Dubai Pearl Exchange.
Joining the DDE is an excellent way to gain access to the city’s diamond trade network, as the organisation maintains a strict set of by-laws and a code of conduct for its members.
The world of diamond trading is close-knit and can be difficult to break into, so DDE membership is a way of demonstrating your bona fides when it comes to finding a reputable diamond trader.
The DDE is the only bourse in the Middle East affiliated with the World Federation of Diamond Bourses (WFDB).
Dubai is a big player in diamond trading, and getting bigger
Dubai is one of the most important cities in the world for trading in rough diamonds, alongside Antwerp, New York and Tel Aviv. This makes it a great place to buy and sell rough diamonds in particular, while it is also moving into the synthetic diamonds market.
In early 2019 the DDE opened its redesigned and upgraded auction facility, which is part of its mission to become the world’s biggest diamond trading hub by 2023. The new trading floor has 41 viewing stations with specially designed lighting and high-resolution cameras.
While Dubai may not eclipse the Belgian city of Antwerp as the world centre for diamond trading in that time frame, the new facilities should increase the number of major auctions in the city.
The DDE also operates a world class vault for storing high value items such as diamonds. It is located within the DDE itself, and traders can deposit or withdraw items using a fully automated robotic system.
Dubai’s growing presence in the world diamond trade was underlined in early 2019, when the DMCC hosted the world’s first ever tender for synthetic rough diamonds.
Dubai is home to major diamond trading companies
Hundreds of companies buy and sell rough diamonds around the world, and the biggest tend to be listed as “sightholders” by the De Beers Group. De Beers is the largest diamond company in the world, selling an estimated 37% of the world’s rough diamonds in 2018.
Sightholders are companies authorised to make bulk purchases of diamonds from De Beers, and two companies headquartered in Dubai are on the list: Vijay Diamond and Diarush. A third on that list, Belgian company Pluczenik, has a sales office in Dubai.
However, that list covers bulk purchasers, and hundreds of other companies will trade in rough and polished diamonds in Dubai, usually through the DDE.
Check the accreditation of traders, laboratories and stones
When you are trading diamonds in Dubai or anywhere in the world you need to be aware of how certification works.
First, you should check that a trader is accredited with a reputable organisation. Unlike the gold trade, this can vary depending where a trader is based.
DDE membership is a good indicator of quality, while other reliable forms of certification are the Gemmological Association of Great Britain (Gem-A) and the Gemological Institute of America (GIA). Other organisations offer similar accreditation.
If you are trading in cut diamonds, each stone will normally have a certificate which rates its quality across four categories: carat, colour, clarity and cut.
These certificates are produced by laboratories, which should be accredited by a reputable organisation, such as the GIA, International Gemological Institute or HRD Antwerp. These organisations have different criteria and standards for certifying laboratories.
Make sure you understand the Kimberley Process
The diamond trade went through a particularly challenging period in the 1990s, when illegally exported stones were used to fund civil wars in parts of Africa. These are known as “blood diamonds”.
To prevent this illicit trade, the United Nations developed the Kimberley Process Certification System (KPCS). The system has 54 member nations, including the United Arab Emirates, but diamond producing countries Republic of Congo, Ivory Coast and Venezuela do not participate.
If you work with companies accredited with the DDE you are unlikely to encounter diamond traders in Dubai who are skirting around KPCS regulations.
Overall, Dubai is a highly reputable place to trade diamonds, and it has world class facilities to help you do so. The DDE is used by companies of all sizes, which smooths the process of finding a reputable diamond trader in Dubai.
Marcus Briggs, of Icon Gold and Citi Group, is a highly successful entrepreneur and senior executive in the gold markets in the UAE, Africa and South America. Here he shares his knowledge and expertise on gold trading and investing.