The Diamond Certification Laboratory of Australia (DCLA)
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Rough diamond prices have increased by 10-15 per cent in the last one and half months amid a supply crunch due to US sanctions on Russia’s Alrosa, said Bakul Gajera, who works with Surat-based Laxmi Diamond, a leading polisher.
The diamond industry in Surat, Gujarat, is preparing for flat domestic and international demand as raw material prices rise and “recessionary trends” build in the west.
More: business-standard
The number of active US jewelry companies continued to decline in the second quarter, according to the latest data from the Jewelers Board of Trade (JBT).
Some 161 businesses shuttered during the three months ending June 30, compared with 143 in the same period a year earlier, the JBT said last week. In total there were 23,796 companies active in the US industry, a drop of 1.8% compared with the second quarter of 2021, and 56 fewer than the previous quarter.
Of the businesses that discontinued operations, 32 shut due to mergers or takeovers, while 129 closed for other reasons. None went bankrupt, the JBT noted. Meanwhile, the number of new business grew to 136, compared to 105 the year before.
Retailers still constituted the bulk of the sector, at 18,059, down 1.6% year on year. The wholesale trade slipped 2% to 3,424, while the manufacturing sector contracted 2.9% to 2,313 firms.
The JBT, which provides credit information for the trade, downgraded the credit ratings of 831 companies across the US and Canada during the quarter, versus 757 a year ago. Meanwhile, it raised the scores of 752 businesses, versus 1,195 from April to June of 2021.
Source: Diamonds.net
US authorities are investigating a massive theft of jewelry from a Brink’s armored vehicle in California last week.
The truck was transporting goods to the International Gem & Jewelry Show in Pasadena, California, exhibition director Brandy Swanson told Rapaport News on Tuesday. The victims were 16 to 18 vendors. The contents included “high-end jewelry, watches and diamonds,” Swanson said.
The executive estimated the losses at $100 million to $150 million. Brink’s put the value at less than $10 million, according to media reports — a discrepancy explained by the practice of vendors underinsuring goods, Swanson noted.
“They all have invoices and paperwork to show the higher value,” Swanson said.
The theft occurred early on July 11, according to a spokesperson for the Federal Bureau of Investigation (FBI) in Los Angeles, which is investigating the case together with the Los Angeles County Sheriff’s Department.
On that day, deputies from the Sheriff’s Department station in Santa Clarita, California, were called to the “Flying J” rest stop and gas station in the mountain community of Lebec in response to the burglary of a cargo container.
They “learned that several pieces of jewelry and gemstones valued at several million dollars were stolen from a locked ‘Brink’s’ tractor trailer by unknown suspects,” the department said Monday in a report.
“According to the information the customers provided to us before they shipped their items, the total value of the missing items is less than $10 million,” Brink’s said in a statement quoted in the US media. “We are working with law enforcement, and we will fully reimburse our customers for the value of their assets that were stolen, in accordance with the terms of our contract.” The company did not respond to a request for comment from Rapaport News.
Source: Diamonds.net
The Baselworld fair has received much criticism in recent years, but one of the final shows before its public implosion appears to have facilitated a diamond deal that counts among the biggest in history.
Antwerp-based manufacturers Taché and Samir Gems came to the March 2018 exhibition with the exquisite Lesotho Legend, a 910-carat, type IIa diamond they had bought together from Gem Diamonds for $40 million earlier that month. At the time, jewelers such as Graff and Harry Winston dominated the big-stone market. Displaying the massive rough at the prestigious Swiss event could help drum up broader interest in the category, Taché and Samir believed.
“We felt that the market was a bit saturated between one or two players,” says Jean-Jacques Taché, managing director for sales at Taché, from his office in Tel Aviv, Israel. “So we thought, let’s bring it to Basel, let’s…showcase the [rough], and let’s see the reactions.”
Plenty of visitors wanted selfies with the stone, which came from the famous Letšeng mine in Lesotho. Some suggested buying a sliver of the piece — polished of, say, 5 to 20 carats, Taché recalls. However, “none of them were really committed at that point to enter into a venture.”
The exception was Van Cleef & Arpels, a Richemont-owned luxury brand that, Taché explains, had been somewhat pulling back from big stones in recent years.
“From the minute they saw it, [Van Cleef] started to talk about the idea that they had,” the executive adds. The timing was perfect: The luxury brand had just finished a ruby collection and was seeking a new project on which to spend a few years. “Sometimes you need a lot of things to happen at the same time in order to make it a success.”
The buying executive representing Van Cleef needed approval from Nicolas Bos, the brand’s CEO, and the Richemont team. Not long after the event, Taché, Samir and Van Cleef signed an agreement calling for the jeweler to buy the final polished. The condition was that the finished goods met the French house’s high quality criteria.
Long wait
Only this month did Van Cleef reveal the finished jewelry, more than four years after the initial pitch. The result was a unique collection of 25 Mystery Set jewels featuring 67 D-flawless diamonds. The largest is an oval, 79.35-carat stone that takes pride of place in a necklace called Atours Mystérieux, meaning “mysterious attire.” The smallest is 0.29 carats. The parties have not disclosed the polished sale price.
Taché and Samir both took heavy risks by splurging on the rough back in 2018. (Gem Diamonds publicly named Samir as the buyer: As is often the case, a miner only invoices one entity, but the purchase was really a 50:50 partnership.)
The two companies have a long-standing collaboration, having also bought the 341.9-carat Queen of Kalahari together from Lucara Diamond Corp. a few years earlier. They sold that polished to Chopard. Samir has its expertise in purchasing large rough stones; Taché specializes more in relationships with the top jewelry brands.
“We’re the most successful Jewish-Indian partnership on the market, by far,” says Taché.
They outsourced the cutting and polishing to Diamcad, an Antwerp firm that also manufactured the Lesedi La Rona for Graff. The goods went for grading at the Gemological Institute of America (GIA) in New York, where all the stones received Diamond Origin Reports stating that they were from the Lesotho Legend.
Van Cleef took delivery of the polished as each stone was ready between January 2019 and March 2020, Taché notes. However, Covid-19 delayed the launch, as Van Cleef had been hoping to hold roadshows.
Quality over size
The manufacturers agreed to include Van Cleef throughout the process, including in the planning and design. The Taché and Samir teams even traveled with Van Cleef’s Bos to Lesotho in May 2019 to experience the Letšeng mine and learn about the local community there.
The brand would accept only flawless goods, so quality became a higher priority than size. The planning process, which took about seven months in 2018, saw the parties review around 180 possible combinations of outcomes. None of them included any “monster” stones, they note.
“Instead of 67 stones, you could also have a model with probably 12 pieces only, but [it would have been] much less interesting in terms of creation,” Taché continues.
There were other complicating factors. Van Cleef tends to avoid round and heart-shaped diamonds. It also wanted matching pairs: “Practically every stone in this collection between 10 and 30 carats is a couple,” he points out.
“If we went for something which was 100-carats-plus, we would have had to go into the VS range,” comments Antwerp-based Anjal Bhansali, managing director at Samir. The team even broke up a stone of roughly 75 carats into two matching stones weighing around 30 carats each, Bhansali reveals.
Boost for big stones
The manufacturers hope the collection will succeed in reinvigorating the large-diamond sector, expanding it beyond the traditional two giants.
“The goal is to create more awareness for big stones in the market and to bring in new players,” Taché concludes. “We started it with Chopard. We [are continuing] this now with Van Cleef.”
It’s unclear whether the Basel show will ever return. However, everyone involved in the Lesotho Legend project will agree that the 2018 edition was well worth it.
Source: Diamonds.net
A damaging ransom attack has forced luxury British jeweler Graff Diamonds to pay $7.5 million worth of Bitcoin to a group of Russian hackers, a London lawsuit revealed.
In case of failure to pay, a group of hackers threatened to leak the private data of jeweler’s high-profile clients. Graff is known for its famous clientele, including Oprah Winfrey, the Sultan of Brunei, and royalty from the Middle East.
Graff is suing its insurer, Travelers, for refusing to cover the ransom, which is how more information about the hack came out. Graff is maintaining that the payout should have been covered by insurance.
The hack happened in September 2021, with ransomware group Conti taking responsibility and leaking data. The attack was somewhat unusual, with Conti issuing an apology to Graff’s clients from Saudi Arabia, UAE, and Qatar while also threatening to leak more data.
“We found that our sample data was not properly reviewed before being uploaded to the blog,” the hackers wrote back in October. “Conti guarantees that any information pertaining to members of Saudi Arabia, UAE, and Qatar families will be deleted without any exposure and review. Our Team apologizes to His Royal Highness Prince Mohammed bin Salman and any other members of the Royal Families whose names were mentioned in the publication for any inconvenience.”
Among the leaked data was private information on celebrities like David Beckham, Oprah Winfrey, and Donald Trump, The Daily Mail reported last year.
In November, Graff ended up paying half of Conti’s initial demand, which was $15 million worth of Bitcoin. The cryptocurrency was transferred to a Bitcoin wallet at a time when the digital currency was around its all-time high of $69,000.
“The criminals threatened targeted publication of our customers private purchases,” a Graff spokesperson said. “We were determined to take all possible steps to protect their interests and so negotiated a payment which successfully neutralized that threat.”
According to the spokesperson, Graff is “extremely frustrated and disappointed by Travelers’ attempt to avoid settlement of this insured risk. They have left us with no option but to bring these recovery proceedings at the High Court.”
Graff was founded in 1960 by billionaire Laurence Graff, who is now worth $5.8 billion, according to the Bloomberg Billionaire Index.
Las Vegas… Diamond market sentiment received a boost from the Las Vegas shows, which demonstrated robust US demand. However, polished prices declined amid a weak global economic outlook and a rise in inventory levels.
The RapNet Diamond Index (RAPI™) for 1-carat diamonds slid 1.8% in June but increased 7.4% between the beginning of the year and July 1.
| RapNet Diamond Index (RAPI™) | |||
|---|---|---|---|
| June | 1H 2022 | Year on year July 1, 2021, to July 1 2022 | |
| RAPI 0.30 ct. | -1.0% | 0.2% | -1.6% |
| RAPI 0.50 ct. | -1.6% | 4.1% | 5.0% |
| RAPI 1 ct. | -1.8% | 7.4% | 16.8% |
| RAPI 3 ct. | -0.8% | 9.7% | 22.2% |
Trading in Las Vegas reflected jewelers’ strong liquidity after a profitable 2021. Activity slowed once the fairs ended and dealers headed for vacations at the beginning of July.
There were also renewed fears of a recession; the US economy shrank 1.6% in the first quarter, and the latest data showed inflation at 8.5% in May. Consumer confidence dropped 4.5 points in June to its lowest level since February 2021, according to The Conference Board.
Chinese demand was low as well following Covid-19 lockdowns in April and May. The lack of buyers meant local jewelers had sufficient inventory for the short term.
Polished inventory in the midstream grew in June. The number of diamonds listed on RapNet rose 4.3% during the month to 1.87 million as of July 1. The high volume came despite the Russian sanctions that limited Alrosa’s rough sales and took an estimated 30% of global production off the market. Russian rough shortages are expected to impact polished supply in the coming months; manufacturers have so far been working with goods from before Russia’s invasion of Ukraine.
Other miners are capitalizing on the new rough-market dynamic. De Beers’ June sales rose 36% year on year to $650 million after a price hike of 8% to 10% on smaller rough — a category Alrosa usually dominates.
We predict that traceable, ethical diamonds will sell at a premium to Russian diamonds as Alrosa goods reenter the market. While US jewelers are upbeat after the shows, there are political and economic headwinds that will likely disrupt the industry in the second half.
Additional information is available at www.diamonds.net.
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“The government has approved amendments to the Tax Code, said Deputy Finance Minister Alexei Moiseev
According to media reports quoted by Rough & Polished, Russia’s Deputy Finance Minister Alexei Moiseev said during the Cheboksary Economic Forum that the government of the Russian Federation “approved the introduction of a zero VAT rate on rough and polished diamonds.”
“The government has approved amendments to the Tax Code, which provide for the introduction of a zero VAT rate on rough and polished diamonds,” he said on the sidelines of the Cheboksary Economic Forum.
This decision, he reportedly added, “will facilitate growth in demand for investment diamonds within Russia.”Credit: Alrosa
Source: israelidiamond
ussia condemned what it called a push to “politicise” its diamonds over the conflict in Ukraine and said attempts to question its compliance with the international diamond certification scheme were “totally unfounded” and “far-fetched”.
The Kimberley Process, a coalition of governments, the diamond industry and civil society responsible for certifying diamonds as conflict-free, is split over a push by Ukraine and others to expand its definition of conflict diamonds to include those funding aggression by states.
The KP Civil Society Coalition (CSC) and some member states sought to discuss whether Russia’s diamonds were helping to fund the war in Ukraine during a KP meeting in Botswana last week.
“The Russian Federation absolutely condemns the orchestrated attempts of CSC, backed by absolute minority of some Western participants, to politicize the work of the Kimberley Process by deliberately distorting or even openly replacing its basic principles,” Russia’s finance ministry said in an emailed statement. It did not specify which principles it felt were being distorted or replaced.
The CSC did not immediately respond to an emailed request for comment.
The KP defines conflict diamonds as those that fund rebel movements seeking to overthrow legitimate governments, a narrow definition that many have sought to widen since the KP was founded in 2003.
Russia, which was KP chair last year, has “championed” work on revising the definition of conflict diamonds for the past five years, the finance ministry said, and it is committed to continuing talks on the definition.
“We therefore call on our opponents to refrain from further speculative accusations, abstain from political demagoguery and concentrate on the substantive work of the KP,” the finance ministry said.
The KP makes all decisions by consensus and the rift over Russia and Ukraine could jeopardise its effectiveness.
Source: miningweekly
When De Beers first introduced its Lightbox lab-grown jewelry brand in 2018, the diamond world sat up and took notice. The mining giant had long been outspoken about its belief that synthetic stones were neither special nor unique. And despite having entered the field itself, the company still holds by that sentiment. Since first making waves throughout the trade, it has done its utmost to create a clear distinction between the two types of stones, touting natural diamonds as a higher-value, engagement-worthy offering, and positioning Lightbox’s products in what brand CEO Steve Coe delineates as “the accessibly priced fashion-jewelry space.”
But a look at the market four years on suggests that this message may have been lost in translation.
The opening gambit
After the initial shock of the Lightbox announcement wore off, the general theory in the natural-diamond industry was that the brand was De Beers’ strategy for negating the perceived threat of lab-grown. Understood but unspoken in its marketing was that Lightbox aimed to create an alternative stream for synthetics — one that wasn’t bridal and wasn’t in that price range.
“I think there was a great opportunity for lab-grown diamonds that De Beers didn’t want to pass up,” says Dick Garard, president of the International Grown Diamond Association (IGDA). “They thought they had a marketing strategy there…. They came out with a pricing structure, and the intent was to drive the pricing down to that point. I think their overall intent was to help augment their mined-diamond business.”
Jewelry consultant Pam Danziger also took Lightbox’s debut as a warning shot to synthetics — a way of reframing them as a lesser alternative to natural stones, not as a luxury product.
“De Beers tried to tell the consumer what lab-grown diamonds were for,” she says. “They said it’s for fashion, not for anything serious. It was like they were trying to exert market control and keep lab-grown in a separate lane.”
Of course, a company as big and well-known as De Beers can’t rock the boat without creating some far-reaching ripples, and it did — just not necessarily the ones it may have been expecting.
Stamp of approval?
If De Beers’ subliminal strategy was to create an invisible barrier around the space where lab-grown was supposed to reside, the plan did not unfold as it was meant to. Rather than decreasing interest in synthetic diamonds as a viable alternative to natural, the company’s move into the space solidified lab-grown’s legitimacy among trade members and consumers alike.
“[De Beers] kind of heightened the awareness and desire for lab-grown diamonds,” explains Adrienne Fay, vice president of Warren Buffett-owned jeweler Borsheims. “Maybe it was an unintended consequence, rather than a misstep, that by trying to point out that this is a product inferior to mined diamonds, it sort of highlighted the fact that it’s actually a product very similar to mined diamonds, and that there is a demand for it.”
The De Beers name on lab-grown jewelry became the ultimate stamp of approval for customers, agrees Eileen Hopman, owner of Hopman Jewelers in Elkhart, Indiana. Whenever she saw doubt from shoppers about the validity of synthetics, she says, she would whisper the magic words: “Even De Beers is selling lab-grown.” From there, the purchase was usually a fait accompli.
Traders, too, have taken the De Beers move as an endorsement, reports Mark Clodius, owner of Clodius & Co. Jewelers in Rockford, Illinois.
“It certainly prompted overall approval throughout the industry, and quite dramatically,” he says. “It achieved so much publicity that it was hard for jewelers to ignore it.”
“What De Beers has…been successful at is having price consistency among diamond growers.”
Adrienne Fay
Vice President, Borsheims
The bridal boom
Fay, Hopman and Clodius are among the jewelers that were already carrying lab-grown diamonds before the launch of Lightbox. From the brand’s debut in 2018 until a year later, the retailers saw a big jump in growth, with sales doubling or better every year after that.
Consumer surveys appear to support this trend. The number of bridal shoppers who feel a natural diamond is important has gone down, according to a 2021 survey from wedding website The Knot. Nearly one quarter of all engagement ring purchases last year featured a man-made center stone, it found — an increase of 11% over two years. Another study, this one by jewelry insurance business Brite & Co., confirms that lab-grown is gaining on natural when it comes to bridal appeal: The market share of synthetic-diamond engagement rings grew to more than 28% in 2021 from 19% the year before, while average spending rose 9%, not far behind the 12% increase that mined stones enjoyed.
Despite the data, however, De Beers insists it will not hop on the lab-grown engagement train and says it still sees synthetics functioning most promisingly in fashion. The lower price point of that segment “opens up a very exciting opportunity for a much higher level of repeat purchases,” says Coe. “There are some retailers out there that are pushing the [engagement] avenue very strongly…but we see the big opportunity for lab-grown elsewhere.”
Still, by setting a bar and sticking to it, Lightbox might be missing out. The bulk of lab-grown sales at Borsheims are for bridal, and synthetics make up approximately 60% of engagement ring purchases at Clodius. Hopman, who first began carrying them as an alternative to natural stones, says they’ve become her bread and butter, making up 90% of all engagement center stones she sells. The lab-created gems have become so popular with her buyers that she has stopped carrying natural diamonds unless they’re preset in a piece she really likes.
“Like De Beers, we were initially promoting them more for fashion jewelry versus engagement rings,” she explains. “But more people came in and wanted bigger diamonds, and as the prices for mined diamonds began to increase, they were stuck settling for either a smaller diamond or a lesser-quality stone. And we began showing them the lab-grown. Once we let them know the Federal Trade Commission (FTC) had sanctioned them as real diamonds, they took off.”
“There are some retailers out there that are pushing the [engagement] avenue very strongly…but we see the big opportunity elsewhere.”
Steve Coe
CEO, Lightbox
The price is right
One thing De Beers has managed to do, Fay believes, is contain the price of lab-grown, though not at the $800-per-carat level that Lightbox charges. Not even at the $1,500-per-carat price tag of its Finest line, which includes synthetic stones with a higher color range of D to F.
“De Beers, because they’re such a behemoth, they’re going to have an impact,” asserts Fay. “I think what De Beers has managed to disrupt, and been successful at, is having price consistency among lab-grown diamond growers.”
The figures seem to prove her right. Within six months of Lightbox’s arrival on the scene, the average discount for a 1-carat lab-grown diamond grew to 42% of the equivalent natural stone — up from 29% in January 2018, just before the De Beers brand launched, according to data that Reuters cited from industry analyst Paul Zimnisky. Meanwhile, wholesale prices for synthetics fell 13.3% from 2019 to 2020, according to online marketplace Virtual Diamond Boutique.
Clodius and Hopman are currently selling lab-grown engagement rings at approximately 50% to 70% of their natural counterparts’ prices, depending on the cut and carat weight of the stone, and the price they pay their lab-grown suppliers has dropped since 2018. However, they’re a bit more hesitant to attribute the latter development to Lightbox. So is Zimnisky.
“I believe it’s the overall fundamentals of the market that are pressuring lab-grown diamond prices — particularly the supply side of the equation — not Lightbox per se,” Zimnisky says. “Perhaps the Lightbox launch a few years back has accelerated this trend, but when you really look at the supply fundamentals of the space, how many new producers have entered the space in the recent past, I think it’s more production growth and production improvements that have accelerated supply [and] most heavily weighed on prices.”
“It was like [De Beers was] trying to exert market control and keep lab-grown in a separate lane.”
Pam Danziger
Jewelry consultant
Down the line
What does the future hold for lab-grown, and will De Beers play a role in how it gets there? The answer depends on whom you ask.
“Will lab-grown diamonds fall into fashion? Yes,” says the IGDA’s Garard. “But will they also still fall into bridal and high-end? Absolutely. And supply is too tight to meet demand currently, so to have a carat sell for $800? I think that’s a bit low.”
Zimnisky disagrees: “Ultimately, I think the Lightbox price point is the right level for the lab-grown diamond product in general. Sometimes I think it’s too low, and sometimes I feel that it’s too high, so that’s probably a sign that it’s just about right — for now, at least. However…in five years’ time, this price point will probably seem too high. I think we’ll see $500 per carat or less in 10 years’ time. Longer-term, I think the price point is what will ultimately relegate the product to more ‘fashion’-oriented — more so than marketing efforts.”
Source: Diamonds.net