news – Page 9 – The Diamond Certification Laboratory of Australia (DCLA)

It’s been a terrible week for diamond miners

While the world’s biggest diamond miner surprised the market by cutting prices this week, a slew of filings from its smaller rivals show the move was inevitable.

While De Beers is a price maker in the supply of rough diamonds, dictating what its customers pay, most other miners are price takers. Gem Diamonds and Lucara Diamond — both known for digging up the most-expensive stones — and Mountain Province Diamonds all reported lower prices this week.

Much of the industry’s current problems have focused on tumbling prices for cheaper, smaller goods, the sort of diamonds that end up in a Walmart ring, but the recent results show even the crown jewels are also feeling the pinch.

Diamond buyers, the industry’s invisible link between African mines and jewelry stores in New York, London and Hong Kong, are being squeezed like rarely before. With too much supply and banks tightening their financing, many traders have been unable to make a profit. That’s now blowing back on the miners.

The De Beers price cut was catching up with the “reality of market conditions,” said Edward Sterck, an analyst at BMO Capital Markets in London. “We think we must be approaching the nadir of the diamond market, which may just mean that a recovery is in the cards,” he added.

Gem Diamonds, which mines the world’s most expensive stones, sold its diamonds for $1,417 a carat in the third quarter. While still an eye-watering figure in an industry that averages less than $200 a carat, it’s down from about $2,100 in 2018.

Lucara reported an average selling price of $390 a carat in the third quarter. That’s a 13% drop from last year and a steep fall from 2015, when gems sold for $593 a carat.

At the bottom end of the market, things have been difficult for a long time. Mountain Province has been struggling with low prices since the beginning. In a 2014 feasibility study, it expected prices of $120 a carat, but sold stones for $53 per carat in the third quarter. The company runs the Gahcho Kue diamond mine in Canada in a joint venture with De Beers.

Source: moneyweb

Blue and Pink Diamonds Show Price Stability in Q3 2019

Prices of fancy color diamonds remained stable in the third quarter of 2019, according to the Fancy Color Diamond Index (FCDI) published by the Fancy Color Research Foundation.

The prices of pinks remained stable this quarter. The slight decrease of 0.1 percent overall was due to a 3 percent decrease in the 5 carat fancy pink category. However, all fancy vivid pinks rose by 0.4 percent, with 1 and 3 carat fancy vivid pinks increasing by 1.6 percent and 1.7 percent.

Blue diamond prices increased just 0.1 percent. The sharpest increase came the 1.5 carat fancy vivid blue category (2.1 percent). Over the past 12 months, the price of this category has appreciated by 10.6 percent. The sharpest drop during this quarter (-2.2 percent) was in the 1.5 carat fancy intense blue category.

The prices of yellow diamonds decreased 1.5 percent during Q3. The largest price decrease of 3.5 percent was in the 3 carat fancy vivid yellow category. Only 2 carat fancy intense yellow diamonds did not experience a fall in prices.

Continuing a trend seen during the past year, the fancy vivid category outperformed (0.1 percent) the fancy intense (-0.5 percent) and fancy (-1.0 percent) categories.

Source: IDEX

HRD Antwerp Receives Two Takeover Bids

The International Gemological Institute (IGI) and industry veteran Peter Meeus have put in rival bids to acquire HRD Antwerp.

Meeus, HRD’s former managing director, last week submitted a proposal to buy at least 51% of the lab in partnership with two unnamed individuals, he told Rapaport News Wednesday. IGI also placed a bid for the lab in the past two or three months, sources said.

“Although HRD has phenomenally lost its market share, the brand awareness is still there, especially in the Middle East, and also in India and Asia,” said Meeus, who headed HRD from 1999 to 2005. “With the whole issue of synthetics, it is my strong belief that once the consumer starts to know about it, all natural diamonds will be sold with a certificate, so this business will grow. The ambition is to bring it back to where we were, and we think we have a formula for that, which will multiply or amplify the number of HRD certificates globally, with a focus on the East.”

Chinese conglomerate Fosun International acquired an 80% stake in IGI last year. IGI CEO Roland Lorie declined to comment, but confirmed that the company had signed a nondisclosure agreement.

The Antwerp World Diamond Centre, which owns HRD, elected not to comment.

Source: Diamonds.net

Family sues Christie’s over $39m diamond sale

34.65-carat-cushion-cut-fancy-intense-pink-princie-diamond

he son of a high-flying Italian senator is taking Christie’s to court in New York City this week (WEDS NOV 6) over the sale of one of the world’s most expensive diamonds, which he claims was stolen from his family.

Amedeo Angiolillo, who now lives in New York, argues that the auction house proceeded with the sale of the $40 million gem (£31m) despite his raising concerns about its provenance. The Princie Diamond, as it is known, as bought by a member of the Qatari royal family.

Christie’s, however, insists that the family members have no proof the diamond belongs to them and, furthermore, their client – who bought it from another family member – had every right to sell the stone.

The story began 300 years ago, when the 34-carat pink diamond was first recorded, in India. It came from the famed Golconda mines near Hyderabad, 400 miles east of Mumbai. The diamond was from a fine “family” – other celebrated Golconda stones include the Agra Diamond, the Hope Diamond at the Smithsonian, the Koh-i-Noor, which forms part of the Crown Jewels.

The diamond was first known as being part of the collection of the Nizam, or king, of Hyderabad.

It was passed down through the generations until the last Nizam, Mir Osman Ali Khan, decided to sell it in the late 1940s through Sotheby’s. It was bought by a Paris jeweller, and then sold on.

In 1960 a flamboyant Italian senator, Renato Angiolillo, purchased the diamond at Van Cleef & Arpels – the same year he married his second wife, Maria Girani Angiolillo,

It had been named “Princie” in honour of the 14-year-old Prince of Baroda, a former state of India, who came to a party that year at the Van Cleef & Arpels store in Paris, along with his mother.

Candida Morvillo an Italian investigative journalist who has been following the story of the diamond for years, said that Angiolillo’s son Amedeo told her that his father bought the diamond in Paris.

“My father bought the diamond in the ‘60s,” he reportedly said.

“He had lost a lot of money at the casino in Monte Carlo, about 700 or 800 million lire.

“My father wanted to prove that they are still rich and solid, so he bought that diamond.”

Angiolillo, founder of Italy’s Il Tempo newspaper, died in 1973, aged 72.

His glamorous widow, known as “the queen of the Rome salons” for her lively soirees of political debate, died in 2009.

When Amedeo Angiolillo went through his stepmother’s extensive art and jewellery collection, he was shocked to find the diamond missing.

Unbeknown to him, his stepbrother – Girani’s son from a previous relationship – Marco Milella had taken the stone.

The question is whether the diamond was rightfully Mr Angiolillo’s or Mr Milella’s.

Under Italian law at the time, as court documents explain, all of the late senator’s possessions should have gone to his children, not his spouse, unless they were explicitly left to her.

His will said his wife should keep their home near the Spanish Steps in Rome and its lavish furnishings. But nothing else was mentioned.

So the lawsuit argues that the rest of the estate, including the diamond, belongs to his descendants – Mr Angiolillo and four grandchildren are the plaintiffs in this case.

But the auction house and its co-defendants said that the diamond, set in a ring, was a gift to Mr Milella’s mother and so was owned by her when her husband died. And even if the transfer of ownership between them was not official, the defendants argue, the way she kept control of the ring in the decades that followed his death made it legally hers.

By 2013, the diamond was long gone. Mr Milella had sold it years earlier for nearly $20 million to a prominent gems dealer in Switzerland named David Gol.

Mr Gol, who has said he believes Mr Milella had clear title to the diamond, then worked with Christie’s to sell it as part of a jewellery auction in 2013.

“Prior to the 2013 auction of the diamond, the two main representatives of the family expressly withdrew any objection to the sale,” Christie’s said.

“Then two years after the successful sale they sued to claim inheritance rights to the proceeds without providing any significant new information to support a title claim.”

The auction house described the matter dismissively, as an “inheritance dispute among family members.”

Source: telegraph

De Beers Lowers Global Diamond-Jewelry Estimate

De Beers has restated its estimation of global diamond-jewelry sales following a new study valuing the diamond content in jewelry purchases since the 2008 recession. The group also revised its production data to reflect lower output than previously believed, stemming from an overestimation of the artisanal mining sector.

Global diamond jewelry demand rose 2.4% to $76 billion in 2018, driven by growth in the US and China, De Beers said in its annual Diamond Insight Report published last week. However, that figure was below the $82 billion it had originally reported for 2017, as the company gained new insight relating to the elements that are included when valuing jewelry, De Beers explained.

The company revised its estimation for 2009 to 2018 following studies it conducted with retailers relating to the content of diamond-jewelry purchases and the structure of the trade, as well as its “Diamond Acquisition Study” with consumers. The revised figures reflect mainly the value of sales in the US, and are more consistent with the total jewelry retail value stated by the US Commerce Department, De Beers noted. The government agency last year revised down its estimation of US jewelry retail sales.

De Beers maintained its assessment of global polished-diamond demand, which saw a 2% rise to $25.3 billion for 2018, a figure that is included in the jewelry sales total. That suggests there was an overestimation of other elements contributing to the overall jewelry value, such as the value of the metal used, a company representative explained.

De Beers used third-party researchers to obtain information from retailers about their diamond sales, including the description of the diamond, the metal used and the full breakdown of the piece. From that information, the company calculated the price per carat of the diamonds and was therefore able to understand the value of the diamond content and the proportion of the total for which it accounts.

“The study revealed that the share of the polished wholesale value in the overall jewelry retail value had increased in the US after the financial crisis of 2008,” the company noted in the report. “The adjustments made resulted in a new lower diamond-jewelry market estimate for the US and globally.”

Sales in the US grew 5% to $36 billion in 2018, accounting for 49% of the total, according to the research. In China, consumer demand for diamonds rose 3% in local currency and 5% by dollar value to $10 billion, with growth slowing considerably in the second half of the year when the US-China trade war escalated, De Beers noted. Demand also grew in Japan, buoyed by the appreciation of the yen against the dollar, while the market declined in India and the Gulf.

De Beers observed that consumers were increasingly tending toward smaller center diamonds in their engagement-ring purchases, but with more side stones and accents. Other trends influencing demand included a shift toward branded products, with 36% of diamond engagement rings by volume being branded, compared to 22% five years ago. Greater confidence in online buying is also spurring growth, helping chain stores and prestige brands gain market share at the expense of specialist independents, the report stated.

De Beers expects growth to continue in 2019, supported by macroeconomic fundamentals. However, dissipating fiscal stimulus and rising recession fears could prove to be a drag on growth in the US in 2020, the company cautioned.

Production levels down

Meanwhile, global diamond production in 2018 fell 2.7% to 154 million carats, with its value up an estimated 2.4% to $17.4 billion in 2018, according to De Beers. In last year’s Insight Report, the company said 2017 output stood at 164 million carats valued at $17.5 billion. De Beers lowered its estimation of global rough production after it commissioned a third-party study of the artisanal mining sector.

“The nature of the informal sector is such that there is less information available to accurately estimate production to a high level of confidence,” a spokesperson explained in an email. “The report concluded that our previous estimates of informal production were likely too high, particularly in the Democratic Republic of the Congo.”

The report outlined growth in global diamond production, rough sales, polished wholesale demand and diamond-jewelry sales, as presented in the following table:

Data from 2019 De Beers Insight report, with Rapaport estimates for percentage growth where it wasn’t provided.

Source: diamonds.net

Drake buys himself $500K heart-shaped diamond ring for his birthday

The “Hotline Bling” rapper can’t stop buying more and more diamond rings to add to his collection. The latest? A 22 carat heart shaped ring set in platinum to celebrate his 33rd birthday.

Created by Gemma Fine Jewelry, Drizzy’s insane design features one enormous bezel-set diamond and also includes three hearts in the bridge underneath the massive rock. The love centric theme could be a testament to just how much the Toronto native adores himself, but jeweler Ori Vechler also called him “the King of Hearts.”

According to Ajay Anand, CEO of Rare Carat, Drake’s new sparkler could have cost around $500,000. “Heart shaped diamonds are one of the most unpopular diamond shapes, because they are so tricky to cut right,” Anand said. “This is a great example of one cut very well, which is quite rare.”

It seems like the unconventional shape is enjoying a bit of a comeback; Offset also recently gifted wife Cardi B with a similar design for her 27th birthday.

Drake debuted the bling at his star studded mobster themed birthday party last week, where he was also sporting his custom Toronto Raptors championship ring, which boasts more than 30 carats of diamonds.

Suffice it to say that Drizzy’s heading into his 33rd year with a lot more sparkle.

Source: pagesix

De Beers Cuts Diamond Prices by About 5% as Industry Crisis Deepens

De Beers is taking more drastic steps to stem the crisis in the diamond industry by cutting prices across the board for the first time in years.

The company, the world’s biggest diamond producer, lowered prices by about 5% at its November sale, according to people familiar with the matter, who asked not to be identified as the information is private.

The move is aimed at helping improve profits for the middlemen of the diamond industry, a group of traders and polishers that buy rough gems from De Beers. Many of these customers, which includes family run traders in Belgium, Israel and India, as well as the subsidiaries of Tiffany & Co. and Graff Diamonds, are running on wafer-thin profit margins because of low prices and an oversupply of polished gems.

“De Beers is a price setter and has not made any price cuts thus far, despite the open market price for rough diamonds falling by about 9% year to date,” said Edward Sterck, an analyst at BMO Capital Markets. “The most important market participant finally taking action after holding out for so long feels like a fairly typical indication that things may be about to improve.”

The price cut is unlikely to trickle down to the retail market and consumers shouldn’t expect to see diamond prices getting cheaper anytime soon.

Part of the problem in the diamond industry is that prices have stagnated as other luxury offerings, like shoes, handbags and resort vacations, crowd the field. It’s also harder for diamond trading companies to find financing because banks are abandoning the sector after being hit by frauds and bad loans.

Still, De Beers has insisted that the current weakness doesn’t mean demand has softened. Last week, the company released data that showed demand for diamond jewelry rose 2.4% last year. In the U.S. market, where almost half of all diamonds are sold, the increase was 4.5%.

The Elite Club That Rules the Diamond World Is Showing Cracks

De Beers sells its gems through 10 sales each year in Botswana’s capital of Gaborone, and the buyers known as “sightholders” have to accept the price and the quantities they’re offered. It’s a system that originated in the 1890s and is designed to benefit both miner and customer, who receives the diamonds at a discounted rate. But the discount has been shrinking. Some sightholders now struggle to make money from a business that was once highly lucrative.

De Beers has offered its buyers more flexibility about their purchases, but it hasn’t been enough. The company made less than $300 million in each of the past three sales, which is the lowest in data going back to 2016.

The November sales data, due next week, could indicate whether the price cuts are helping drive demand.

Anglo American Plc, which owns De Beers, closed up 1.8% at 2,080 pence in London on Monday.

Source: bloomberg

Artisanal small-scale diamond mining initiative launched

Petra Diamonds has launched an artisanal small-scale mining initiative in South Africa. This follows a process of extensive consultation and cooperation with relevant stakeholders.

These include the Department of Mineral Resources and Energy (DMR&E), as mining sector regulator, the Letsemeng Local Municipality, as elected representatives of the community, and the community itself.

Richard Duffy, CE of Petra Diamonds, comments:

“We regard this initiative as another milestone in the Petra legacy and we welcome the Koffiefontein Community Mining Primary Cooperative (KCM) artisanal miners as partners in our industry to complement our own operations and extract optimal benefit from the diamond reserves in Koffiefontein.

“We wish KCM all of the best with this venture and thank our Government and community partners for their continued support of both the project and the KCM.”

Hong Kong Protests Depress Luk Fook Sales

Luk Fook’s same-store sales fell 37% in the second fiscal quarter amid protests in Hong Kong and the continued impact of the US-China trade war.

Total same-store sales — at Luk Fook outlets open for more than a year — in Hong Kong and Macau dropped 39% in the three months ending September 30. Same-store gold sales plunged 46%, while gem-set-jewelry purchases slid 26%. The figures are for shops the jeweler operates itself, excluding franchises.

The decline was the “result of high gold prices, high base effect, together with the substantial decline in the number of visitors to Hong Kong due to recent ongoing social activities,” the company noted. “Both the sales volume and average selling price of gem-set jewelry products saw a double digit drop.” Luk Fook is negotiating its rental agreement with all of its landlords in Hong Kong to avoid having to cut jobs, it said.

Overall same-store sales in mainland China slipped 25%, with revenue from gold products falling 28% and gem-set jewelry dropping 18%. While stores in mainland China showed some improvement in the first two weeks of October, sales in Hong Kong and Macau declined even further after the close of the quarter, as the tourism rate to the area continued to descend, the retailer noted. The most recent figures, reported for August, showed a 42% drop in mainland visitors to Hong Kong, according to data from the Hong Kong Tourism Board.

At the end of the quarter, Luk Fook had 210 self-operated stores, of which 136 were in mainland China, 51 in Hong Kong, 12 in Macau and 11 in other locations. The retailer also has 1,745 licensed shops.

Source: Diamonds.net

More Brides Buying Their Own Engagement Rings

US women increasingly buy engagement rings for themselves, and spend more on them than their partners do, De Beers said Monday in its annual Diamond Insight Report.

The proportion of engagement rings financed solely by brides rose to 14% in 2017 from 11% in 2015 and 7% in 2013, according to the report. The trend reflects growth in female purchasing power, one of several social changes impacting the segment De Beers refers to as “commitment jewelry.”

During the four years ending 2017, grooms’ average outlay on engagement rings dropped 13%, while brides’ spending rose 19%, De Beers noted. In 2017, brides who reported buying the ring themselves shelled out an average of $4,400, while grooms spent $3,300, the company said.

“This emphasizes that growing purchasing power among women is a factor to be reckoned with in the commitment space, and not only when it comes to self-purchasing of diamond jewelry,” the company noted.

The 2019 Insight Report focuses on how consumers view love and diamonds amid changing attitudes to relationships. While marriages rates have declined in the US and engaged couples are waiting longer to tie the knot, “love remains a constant,” and consumers are buying diamonds in a wider variety of ways to symbolize it, De Beers explained.

Commitment jewelry — diamond engagement rings, and diamond wedding bands or rings for women — has retained its important place in the market, with just over 70% of US brides acquiring a diamond engagement ring.

However, the global value of men’s gifts of diamond jewelry to women before or after a wedding now exceeds the value of the engagement- and wedding-ring market. Women in the US who cohabit with their partners now account for 10% of the female diamond-jewelry market. Meanwhile, more than 70% of people in same-sex relationships view diamonds as important for celebrating life’s special events, the report continued.

Those four trends — commitment jewelry, “love gifting,” cohabitation and same-sex couples — are the focus of this year’s edition of the De Beers research. Consumers are still attracted to diamonds as an emblem of love, but are approaching the product in new ways that mirror those contemporary modes of living, the company argued.

“While diamonds are still seen as the ultimate symbols of love, the diamond industry must focus on continuing to offer jewelry, brands and retail experiences that meet the modern consumer’s desire for individual products and experiences that reflect their own unique love story,” said De Beers CEO Bruce Cleaver.

Source: Diamonds.net