Diamond as a Commodity from 1800s Research Assignment

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Diamond as a Commodity from 1800s
The commodity market allows producers along with the users to be in a position to hedge their risks. It is common for the users or the producers exchange traded commodities so that they are able to lock the prices, with reference to items that they will then bring in the future (Nathaniel). One of the most important aspects to note relates to the exchange transactions that take place between the users and the producers, where a marketplace is created and it is such that, even speculators are able to trade the commodities without having to deliver the physical commodity in question. In this case, the speculators are able to deal in diamond although they do not have to deliver the actual diamond. Over the years, there have been the creation of various markets for the various commodities such as, gold silver, crude oil, corn, soybeans and livestock among others (Nathaniel). However, that of diamond has been slow developing.
Throughout history and in particular with reference to the diamond industry, much of the commodity was held or largely monopolized by one family. From the 1800s to the 2000, the diamond commodity was monopolized by the De Beers Family. This was a rich family and one that made maximum benefits from the diamond industry through this time period. Their idea was that they needed to make sure that they control the supply of the diamonds so that they also had control over the prices that the diamond in the market cost (Nathaniel). For the largest part of the period after the 1800s, diamonds have been controlled by a few selected companies, most of which were family owned, which dictates the industry dynamics, relative to the cost, demand and the supply elements. It is important to note that the industry has experienced some form of relief, however it is not as straight forward.
For the longest time, it is crucial to note that the diamond industry has not had adequate regulations that determine the basic market dynamics. This is unlike the case with commodities such as gold and/or silver. With diamond, there have always been some very significant differences between what one player in the market will use with reference to cuts, clarities and even the carat measurements. This thus makes it hard to establish some element of quality control, given that every other person will use their own standards. As such, every other stone is always likely to be ...