JCK News Director Rob Bates discusses the implications of Jewellery group Signet's announcement that it will start implementing a Responsible Sourcing Protocol for Diamonds, requiring its suppliers to provide diamonds from identified sources, from mine to finger, so to speak. The initiative, which received support from diamond industry organisations such as the World Federation of Diamond Bourses and the Diamond Development Initiative, will be a work in progress, Signet stated, continuously improving.
"Throughout the diamond pipeline, the time has come to "expose" rather than quietly "acquiesce". If a jeweler did something wrong, let the courts decide. If someone committed a fraud, let him go to jail. Consumers will have far more confidence in those jewelers that prove their trust and integrity by standing up - rather than "giving in." In many instances, the retailer is a victim of his or her diamond supplier. Let them become accountable as well."
Chaim Even-Zohar, industry expert - Diamond Intelligence Briefing
In an elaborate investigative piece that is clearly stirring up much debate, JCK News Director Rob Bates dives into yet another episode of the EGL overgrading saga, and wonders if overgrading lawsuits have become overkill. Nashville law firm Cummings Manookian recently launched an aggressive flyer and online campaign against a handful of small jewelry retailers – and in some cases their personnel - in the U.S., seemingly aimed at recruiting dissatisfied customers in their crusade against overgrading by the former EGL International diamond grading lab.
Rob Bates of JCK has published an open letter to Leonardo DiCaprio, of Blood Diamond fame, urging him to reconsider his support for new synthetic diamond producer Diamond Foundry, and to remember the social realities that once moved him. "Back in 2006, you seemed profoundly impacted by your meeting with one of the great figures of the 20th century, Nelson Mandela.
JCK's Rob Bates writes the fascinating story behind acquiring and polishing the world's most expensive diamond, the Blue Moon, as told by Ehud Laniado, chairman of Cora International, which bought the stone. To recap: in November, Sotheby’s sold the Blue Moon, the 12.03 ct. internally flawless vivid blue cushion cut, for $48.5 million, setting a world record for a diamond at auction. Before that, the stone, discovered by Petra Diamonds at the Cullinan mine in South Africa, was a 29.62 ct.
In his latest opinion piece, award winning JCK News Director Rob Bates expresses his concern over the latest example of so-called "activist investors" nudging their way into companies.
For the last few years, the [jewelry] industry has posted small but steady growth - usually in the single digits. This holiday looks to continue this pattern. Sales grew, but not by a huge amount ... At the Forevermark cocktail party on Jan. 11, De Beers CEO Philippe Mellier said his stats showed sales for both the holiday season and the year rose 7% at Forevermark jewelers ... Concerning the diamond business in general, the overall (but certainly not absolute) consensus is that it is starting to bottom out, and we should see a turnaround by this summer.
Rob Bates of JCK reports that their survey of jewelers from across the U.S. revealed that strong diamond sales formed the backbone of a solid holiday season. Designer lines, gemstones and silver also did well, and, "As usual, jewelers griped that the weather hurt sales - but this year the problem was good weather, as unseasonably warm temperatures dampened the holiday mood." A selection from the jewelers' comments: “The month of December was up by 16 percent. Just the month of December, though. The year is even.… People were less hesitant about purchasing.
In a brief essay worthy of a read by anyone interested in the diamond industry, Rob Bates has succinctly summarized how the natural diamond industry could turn the nomenclature of non-natural diamonds in its favor. "Last year," he writes, "I argued that the best term for lab-grown diamonds may be non-mined. That is scientifically accurate and also gets across the stones’ main selling point.
Rob Bates of JCK takes an insightful look into the troubles that have plagued the diamond industry in the second half of 2015, and analyses the internal bickering that has resulted. Only a short time ago, De Beers was the crown jewel in the tarnished Anglo American crown, but now, at the end of 2015, the bottom has fallen out of the diamond business. De Beers’ second-half sales will likely come in at $1.2 billion–$1.3 billion, a 30-year low.
Rob Bates of JCK reports that the consolidation trend in the U.S. jewelry industry continued in the third quarter 2015 with closures jumping 25% over last year, according to statistics compiled by the Jewelers Board of Trade. Some 276 U.S. jewelry businesses ceased operations, compared to 214 in Q3 2014 (this is out of 29,404 total business listings, according to Bates' info from JBT). That number includes retail jewelers, wholesalers, and manufacturers. The main category of companies ceasing operations was retail jewelers.
In his blog "The Diamond Selling System Is Broken. Can It Be Fixed?" Rob Bates looks at the stammering rough selling system and discusses six alternative scenario's for selling rough and rough pricing, their pro's and con's and the likelihood of being adopted. Bates weighs the alternatives; using prices based on production (mining) cost, producers providing credit to clients, the option to let clients negotiate, steady prices throughout a contract term, selling rough exclusively through tenders and last but not least, more transparency on selling systems.
JCK's Rob Bates weighs in on the growing consternation over rumors of De Beers' supposed dual pricing system, which Charles Wyndham discussed at length last week.
In his latest blog piece, JCK's Rob Bates talks about the decade-old controversy surrounding the Rapaport Raplist that pops every now and then. Despite the bickering and the fact much more data is generated and available today, the Raplist still is the number one source for diamond prices used by the industry. Bates argues discussion about price lists are not exclusive to the diamond industry, taking oil prices as an example.
Following the release of the De Beers 2015 Insights report, Rob Bates takes another look at the ubiquitous supply-demand chart, questioning the rosy outlook - in which demand will outpace supply and prices will consequently rise - painted by the mining company. Bates argues that contrary to the theory, demand hasn't quite followed the predicted upward curve, demonstrating that without some serious industry effort to boost demand, that bright future is by no means guaranteed.
Blue Nile, the largest online retailer of diamonds, intends to continue rolling out its brick-and-mortar 'webrooms', albeit in limited fashion. The company will open three to four more brick-and-mortar locations in 2016, CEO Harvey Kanter told the B. Riley & Co. and Great American Group Consumer Conference on Sept.16. So far, the company has limited the stores to (US) states in which it charges sales tax (New York and Washington), but Kanter hinted the store may eventually venture beyond that.
Rob Bates, JCK News Director, in his blog argues that the recent announcement by industry associations, saying industry professionals that carry reports that deviate by more than one color grade from the standard GIA scale will be subject to arbitration, could be a game changer. Overgrading has been a widespread trade practice, Bates says, and a dangerous one now that lawyers have announced they are intending to initiate a wider class action, targeting these malpractices.
Jewelry has traditionally been something gifted to women and even now that view holds strong, but many women have given up waiting and are buying jewelry for themselves – for the fun of it ('Just Becausers'), for investment purposes, as divorce presents, or as a beautiful way to squander their bonuses. Bonhams auction house reports that at its most recent jewelry sales in London, half the buyers were women. The trend is global; in the US, Bonhams expects one-third of its jewelry buyers this year to be female, while in Hong Kong, the figure is already 41%.
In his latest blog, Rob Bates takes stock of who will be the next KP Chair. The United Arab Emirate's bid was and is much contested by NGO's, Bates says, but it appears Dubai will assume the chairmanship next year - if Dubai agrees to certain conditions - after Australia backed out at the recent KP Intersessional in Luanda, Angola.
The recycled diamonds trade has become a huge, under-the-radar market. Analysts estimate overall sales of “recycled diamonds” at about $1.5 - $2bn a year, out of $81bn in diamonds sold globally at retail. And that may be an underestimate. How much this is affecting the wholesale market is unclear.
In an interview with JCK, Susan Jacques, GIA's CEO and chief laboratory and research officer Tom Moses tell Rob Bates increased capacity and global expansion - potentially opening up an additional lab in Surat - will allow GIA to avoid future backlogs. Furthermore GIA says differences between grading results in overseas labs are rare and GIA uses dummy accounts to rule out these variations as much as possible. Other topics Bates raises include automated grading, the reputation of GIA grading standards and undisclosed synthetics.
In his blog, JCK's Rob Bates elaborates further on the Millennials theme, summing up the key insights succesful retailers believe are inherent to this tough crowd of young consumers. Millennials want something unique, preferably with them being involved in the making of, they like a story but they don't like being told what to buy or like, and in general, they have issues with diamonds, which they consider traditional, standard and - to some - controversial. What it boils down to, Bates concludes, is that the industry needs to find a way to speaking to these new consumers.
In his latest blog, JCK's Rob Bates raises the issue of the current lack of adequate industry response to the emerging 'millennials' market', the largest group of consumers - larger even than the babyboomer generation - in history. Millennials are born between 1981 and 1998 and are characterized as “the most financially conservative generation since the Great Depression.”, practical, prudent, and considered in their purchases, and the industry's decade old advertising tricks aren't effective anymore.
Rob Bates elaborates on diamond traders' attempts, first in India then Israel, to question Rapaport's diamond RAPI price index, by publishing their diamonds on RapNet priced at full “list” (Rapaport) price.
JCK's Rob Bates takes a look at contradicting industry news reports; while De Beers is telling everyone all is going great and the future for global diamond demand is rosy, the industry has sunk into a deep crisis and trade morale is at an all time low. What the industry desperately needs, Bates argues, is leadership, pointing at producers to take up their responsiblity.
JCK's Rob Bates wonders why recent data, saying the US diamond market grew significantly last year, doesn't seem to be reflected in how retailers assess the situation. High expectations contrasting with disappointing end-of-year sales, a highly segmented and geographically spread recovery and increased sales of low-end products could be playing a crucial role, according to Bates.
JCK's Rob Bates interviews Erik Jens, Head of ABN AMRO's Global Diamond & Jewelry Division, on the bank's new "borrowing base verification" policy, aimed to increase transparency and bankability and allowing the bank to go in-depth on its clients transactions. In Jens's words: “We want to send a strong signal to the market that we are open for business, but we want clients we are happy with,”