Archive

  • Signet Jewelers Limited claims to be the world's largest retailer of diamond jewelry and is clearly the largest specialty retail jeweler in the US, UK and Canada. It operates over 3,300 stores primarily under the name brands of Kay Jewelers, Zales, Jared The Galleria Of Jewelry, H.Samuel, Ernest Jones, Peoples, Piercing Pagoda, and JamesAllen.com. Just over a year ago the company was among the S&P 500, but its share price and market cap have fallen hard.

  • A combination of factors has led to widespread uncertainty and a global downturn in the diamond industry during the first half of 2019. Antwerp - the world’s leading diamond trade centre - has not escaped its impact, particularly in the rough diamond trade. Economic uncertainty generated by an unstable geopolitical climate has also fostered a heightened sense of caution among the banks that finance the trade, as well as diamond brokers and consumers of luxury goods.  

  • The diamond industry has hit its halfway mark of 2019 and the song remains the same as Rapaport releases their H1 figures detailing across-the-board declines in polished diamond prices amid, as we noted last week, a period of weak sentiment and even weaker demand, all of which is taking its toll on manufacturers and those that supply them.

  • Russian diamond miner Alrosa's rough diamond sales in May continued the downward trajectory they have been on all year, though the decline was less steep than in prior months. Rough diamond sales fell by 6% year over year to $261 million, and declined 17% compared to last month as the market enters its seasonal slowdown. For the year to date (Jan.-May), the mining giant's rough diamond sales have plummeted by 30% to $1.565 billion from $2.256 billion a year ago.

  • An annual tradition, industry veterans Chaim Even-Zohar and Pranay Narvekar present the 2018 iteration of The Tacy Diamond Pipeline, with an in-depth look at the impact that the rise and acceptance of laboratory-grown diamonds has had on the industry this past year.

  • Is the goal of Lightbox to lower the price of lab-growns?

  • Diamond mining stocks have taken a beating in recent years, with most believing there is no end in sight. Post-financial crisis oversupply and rising concerns about the assumed influence of laboratory-grown diamonds have tested the patience and tainted the sentiment of investors in the diamond arena. But the imminent shrinkage of supply and continuing demand for the product is not imaginary. Those who doubt the resilience of the diamond industry and have given up on its ming sector may regret selling low.

  • Rough diamond buyers almost by default desire ‘original’ rough, flowing directly from the mine of origin to the tender house. With current supply limited and no major increases on the horizon, however, maximizing the volume of available goods becomes more of a priority. Adam Schulman at Koin International tender house in Antwerp believes he has found an answer in KoinDex, a sales system that takes the hidden supply of rough diamonds already available to the market and packages them into parcels deserving of the same respect and attention from buyers that original rough goods receive.

  • There is no fundamental change in the small diamond segment. The slowdown in the smaller sizes during the second half of last year is mainly cyclical – it is driven primarily by demand-supply dynamics. It is a misconception that there is any fundamental change in consumer behavior. The prices are coming down to where they should be, and this is mainly because retailers have realized how large the margins of LGD manufacturers have been. They are now understanding the pricing dynamics for this category and are asking their suppliers why they are charging so much.

  • Following a period of volatility, the global diamond industry regained its luster with 2 percent growth in 2017, writes Bain & Company in the eighth annual global diamond report issued in collaboration with the Antwerp World Diamond Centre. Bain & Co. finds that the diamond industry – just like the luxury market – remains resilient against global socio-economic turmoil. 

  • The De Beers Group provisionally sold $475 million worth of rough diamonds during their eighth sales cycle (October 8-12) of 2018, representing the lowest value of sales at a sight this year. October sales fell by about 6% compared to Sight 7 after the actual September sales were revised down to $503 million from the provisional value reported last month at $530 million. Still, the recent sight is a significant, 26% improvement in comparison to the $376 million in rough sales achieved at Sight 8 in 2017. 

  • Independent analyst Paul Zimnisky estimates by 2035, lab-grown diamond jewelry will achieve total sales $15 billion, as it grows from its current estimated level of estimated $1.9 billion. He bases his estimate on growth of 22% annually to $5.2 billion by 2023 and to $14.9 billion by 2035, equating to a longer-term growth rate of about 9% rate annually. In terms of market share, his research leads him to conclude that lab-grown jewelry will have gained 5% of the market for diamond jewelry (>$250) and 7% for fashion jewelry (<$250) in the same timeframe.

  • De Beers Group and parent company Anglo American announced rough diamond production for Q4 2017 increased five percent to 8.1 million carats from 7.7 million carats, bringing their annual production to 33.4 million carats, a 22% increase over 2016 (27.3m ct). They say the fourth-quarter rise reflects stronger trading conditions as well as the contribution from the ramp-up of Gahcho Kué in Canada, where production doubled to 993,000 carats due to the ramp-up of the mine, which reached nameplate capacity in Q2 2017. Q3 production, however, was notably higher at 9.2 million carats.

  • According to preliminary figures released today, ALROSA’s rough and polished diamond sales for the year 2017 amounted to US$4.27 billion, a 5% decline from the US$4.49 billion in overall sales in 2016 despite an estimated 5% increase in rough diamond production. The Russian mining giant provisionally sold $4.17 billion in rough diamonds compared to $4.34 billion in 2016. They sold US$96.9 million in polished diamonds on the year.

  • In ABN AMRO's lastest iteration of the biannual Diamond Market Outlook, Coordinator FX & Precious Metals Strategy Georgette Boele writes, "The recovery in the diamond trade has grinded to a halt at the start of 2017", as US consumer spending has been disappointing in Q1, lower consumption in Hong Kong and Macau has negatively affected demand (according to company reports from main jewelers in the region) and Chinese retail sales were weaker in January and February.

  • Ashley Davis of National Jeweler reports from JCK Las Vegas on the findings of a survey conducted by WeddingWire, an online wedding marketplace: essentially there seems to be a disconnect between the buyer and the receiver regarding the criteria modern couples use to shop for engagement rings. The proposer’s main concern is the quality of the stone, as the focus is on enduring value; the receiver valued the design and setting above all else, with quality and size ranking fifth and sixth respectively.

  • Stéphane Fischler, President of the International Diamond Council, founding member of the European Council of Diamond Manufacturers, Vice President of the World Diamond Council and President of the Antwerp World Diamond Centre talks to Manisha Gupta on India's CNBC-TV18. He shared his view of the Indian diamond industry and the road ahead for its diamond market. An abbreviated version:

    CNBC: How do you see diamond consumption growth in India?

  • The De Beers Group of Companies has announced the (provisional) value of rough diamond sales (Global Sightholder Sales and Auction Sales) for the second sales cycle of 2017 has earned $545 million. This represents a 25% dropoff from the $729 million achieved in Cycle 1, and is nearly 12% lower than in Cycle 2 2016, which earned $617 million. Nonetheless, excluding January 2017, it is the largest sales cycle since September of 2016. 

  • Reflecting on the impact of the Trump election victory on the future of the diamond trade, particularly on the U.S. and India, independent industry consultant Pranay Narvekar writes in GJEPC's Solitaire International that America's share of the global polished diamond market - already the highest by far at 45% of total value - should only increase in the coming years, while the strength of the dollar and other expected policy moves will only exacerbate uncertainty throughout the trade.

  • The diamond market has been going through difficult times for a while now, but diamond trade data paint a far more optimistic picture than in June, signalling that trade has turned the corner, writes Georgette Boele of ABN Amro in their "Insights" report. Back in June when ABN last published their diamond insights report, Boele still doubted if global diamond trade would improve, but trade data have clearly improved in all centres, most noticeably in Antwerp, Israel and India.

  • Two investment bubbles, 340 years apart, provide living proof of Edmund Burke’s famous observation that those who do not know history are doomed to repeat it. Rough diamond broker and founder and president of N.Rothmann, Nurit Rothmann recounts the history of two remarkably similar speculative bubbles: the spectactular rise and sudden collapse of the tulip market in 1637 and the rough diamond market in the late 1970's and early '80s. Reprinted here by special arrangement.   

  • De Beers today published its "Diamond Insight Report 2016", leading off with the following: "De Beers first published its Diamond Insight Report in 2014. In the two years since, much has changed, but the strong diamond industry fundamentals remain the same." Nonetheless, 'With the first half of 2016 showing signs of more stable conditions returning, it is clear that volatility in the diamond sector is not a short-term phenomenon, but the new normal," says CEO Bruce Cleaver.

  • Russian miner ALROSA has started selling rough and polished diamonds in Vladivostok in Russia's Far East, said Yuri Okoemov, vice president of ALROSA, at a Eurasian Diamond Centre presentation. "I do not think that initially there will be high volumes (of sales). At the beginning, sales will amount to $7 million-$8 million, but the overall potential of the region is larger. We will create diamond cutting and processing facilities. Our task is to, at least, double the amount of diamond sales in the region by 2018," he said.

  • Diamond industry analyst Avi Krawitz presents his rundown of the India International Jewellery Show (IIJS) that took place last week in Mumbai. While noting that IIJS is currently a niche domestic show focusing on gold jewelry - which saw steady business, with jewelers expecting demand to rise along with gold's upward trend - Krawitz sensed optimism about the diamond market even though domestic diamond consumption has slowed recently. "India’s jewelry industry has some hurdles to climb before the diamond trade can grow domestic supply [and demand - DL].

  • According to a press release from Anglo American, De Beers' underlying EBIT (earnings before interest and taxes) for the first half of 2016 increased by 2% to $585 million (H1 2015: $576 million). "This was the result of higher revenues from stronger rough diamond demand, tight operating cost control and favorable exchange rates," reads the statement. Consolidated unit costs declined from $82/carat to $65/carat as a result of cost-saving programs and portfolio changes, supported by favorable exchange rate movements.

  • Citing a Morgan Stanley & Co. International research report, JCK's Rob Bates writes that synthetic diamonds pose a threat to the diamond industry, in particular to the prices of small 'melee' diamonds, and could turn out to be, “a serious potential disruptor” to the established diamond market.

  • The Diamond Investment and Intelligence Center (DIIC) takes a look at the tactics of auction houses for promoting unique and high-end diamonds - particularly Fancy Color Diamonds - to maximize their value at auction. How do they attract their clients and what happens when, as we saw with the Lesedi La Rona just this week, a diamond fails to sell.

  • Following the January report “Diamond Sector Outlook: Nothing is forever, ABN AMRO released a new report on the global diamond industry’s outlook for supply and demand and rough and polished prices. ABN AMRO analysts believe trade figures of the main trading and manufacturing centres point to a “fragile improvement”, with "import and export figures in Antwerp bottoming out, the UAE appears to be stabilizing while Israel remains very weak.”

  • Drawing a worrying analogy between the film The Big Short (2015) - which depicts how everyone took part in the ultimately disastrous play on U.S. subprime mortgages even though the fundamental truth was, or should have been, known to those familiar with the mortgage market - and the current trend in the diamond market, Ehud Arye Laniado issues a warning about ignoring the lessons learned as a result of the diamond downturn of 2015.

  • JCK News director Rob Bates looks at the effect Brexit might have on the diamond and jewelry industry. Bates identifies five potential impact areas. First of all, the vote to exit the EU increases uncertainty and volatility, especially on the financial market, and that is bad news for everybody. Secondly, gold prices are expected to go up, as investors consider it a safe haven amidst the financial turmoil.

  • Polished markets cautious. Hong Kong show begins with low expectations for Chinese demand after relatively weak JCK Las Vegas show. Prices stable at De Beers sight with boxes selling at mid-single-digit premiums amid concerns that rough market fails to reflect sluggish polished demand. Manufacturing steady.

  • In an in-depth analysis of the market for Rough&Polished, analyst Elena Levina says that despite lower reported trade figures in March, three consecutive months of growth indicate the industry seems to have regained balance.

    Levina says polished prices, in certain categories, went up, as did the average rough price per carat, while at the same time, the big producers are said to have maintained the prices they instated last year. Industry sources, Levina continues, are saying that this price stability is again allowing the secondary market to trade at significant premiums.

  • The CEO Magazine sat down with William Lamb, CEO of Lucara Diamond Corp. - finder of the 1,111-carat Lesedi La Rona diamond at the Karowe Mine in Botswana - to talk about steering the development of the small miner with the big stones. Lucara’s acquisition of the Karowe Mine presented a major growth opportunity for the company.

  • In the context of its 2016 Investor Day (21 March in New York, 23 March in London), ALROSA - the world's largest rough diamond produer - published a document stating that demand for rough diamonds is on the rebound.

  • What we are seeing is a group of manufacturers buying enormous amounts of rough at very high and unprofitable prices, which will yield less than needed polished, using credit they may have difficulty paying off because the prices they’ll be able to achieve for the polished can only be low… What better definition for the circumstances that lead to a market to peril. Do you feel this is sustainable? Isn’t it our experience that when rough is purchased in (overall) large quantities with high premiums, the miners raise prices?

  • Diamond industry analyst Ehud Laniado performs a thorough analysis of current rough diamond supply and polished demand, noting a clear trend toward the same oversupply of rough and minimal profitability that undermined the industry in 2015.

  • Rapaport's "Weekly Market Comment", sums up the current mood of the diamond market as follows: "Polished prices [are] firm, market mood [is] much better and rough demand [is] improving due to polished shortages. Manufacturing [is] still at about 30% below capacity. We advise caution as current market prices are based on shortages created by artificial rough prices that are higher than resultant polished. Rough market volatility expected in 1H as miners reduce prices to increase revenue." Meanwhile, with the Chinese New Year right around the corner (Feb.

  • Vocalizing what many in the industry have been whispering in the corridors, jeweler and diamond industry blogger Mel Moss says that the current adversity facing the diamond industry - i.e., the miners and manufacturers - could serve as a catalyst for positive changes, provided a change of attitude. "These sectors need to realise that the diamond industry is a separate entity from the jewelry industry. The predominant attitude among diamantaires is that diamonds are the focus of all jewelry. The truth is that the diamond industry is dependent on the jewelry industry...not vise versa!

  • According to Credit Suisse, diamond producers and their clients, the processors and jewelers, have made a massive miscalculation. Around two years ago, everyone in the industry expected that diamond demand would boom between 2013 and 2015, and so cutters & polishers kept ordering while miners kept up production to meet anticipated demand. Instead, their market was hit by a slowdown in luxury spending, a crackdown on Chinese corruption and anaemic global growth, writes Business Insider.

  • Thomas Biesheuvel at Bloomberg writes that, "More than half of the biggest diamonds in the past decade have been found in the last two years," and Canadian miner Lucara Diamond Corp. unearthed three of them just last month from its Karowe Mine in Botswana. Still, of the hundreds of millions of diamonds unearthed over the past decade, only about a dozen larger than 250 carats have been found, based on a Bloomberg review of company disclosures.