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The state-owned Okavango Diamond Co. (ODC) has made a “prudent decision to withhold” nearly one million carats of rough diamonds after an ad-hoc auction failed to meet its reserve price, signaling the government’s refusal to concede to falling global prices.
The late September “closed” tender, which saw no gems sold, was designed to raise much-needed revenue for the Botswana government. The country, heavily reliant on the sector for approximately 80% of its export sales and a third of its national revenue, is feeling the severe pinch of the industry’s worst downturn in decades.
Despite the urgent need for funds, ODC Managing Director Mmetla Masire confirmed the decision was deliberate.
“We will not join the race to the bottom on prices, our focus is on protecting the integrity and enduring value of Botswana’s diamonds,” Masire said in a statement.
The global diamond market is currently facing a triple threat: a significant drop in Chinese demand, fierce competition from lab-grown stones, and uncertainty stemming from US tariffs.
While ODC insisted the auction was pre-planned and not an “emergency sale,” the decision to hold back the goods underscores the severity of the market conditions. ODC noted that 95% of registered bidders submitted competitive offers, but the final bids did not meet the state trader’s price floor, forcing the unprecedented cancellation.
“Withholding goods in the short term ensures better outcomes for the market,” ODC stated, indicating a long-term strategy to stabilize prices rather than liquidate assets in a distressed market. The move highlights the tightrope Botswana must walk in protecting its main economic driver while managing immediate fiscal pressures.
