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nO I R.IIII1.,.







M.I.D. Leads
Israel's Exports
Anglo American

Updates Strategy
De Beers
Revenue Falls
IGDA Launches

Diamond Named
JNS Jewelry News Se ..... ice

From left: Michael Steinmetz, [eo Schachter Diamonds; Anna Marlin, G/A; Dave Bonaparte, }A;
David Bouffard, Signet JeweJers; Erik jens, ABN AMRO; John Hall, Signet Jewelers; Cecilia Gardner, Jve


Signet Jewelers. the largest jewelry retailer in the
U. S., held a press conference in February 2016 detailing
the launch of a new standard, the Signet Responsible
Sourcing Protocol for Diamonds (D-SRSP). Signet's
new protocol is part of the company's efforts to promote
greater tramparency to better connect with taday's Millennial
comumen; concerned about ethical sourcing for diamonds.
Members of the diamond industry, civil society and
the government who contributed input included miners
De Beers and Rio Tinto, trade organizations Jewelers of
America OA),World Federation of D iamond Bourses (WFDB)
and United States Jewelry Council (VSJC), Signet's diamond
suppliers and more. Signet arrived at its current draft of the
protocol after a two to three year development period. The
D-SRSP was inspired by its previous success with inlplementing
a responsible sourcing protocol for gold and other metak
The D-SRSP covers single stones and parcels from major
producers De Beers,ALROSA, Rio Tinto and Dominion
Diamond Corporation, mixed sources as well as diamonds
from other smaller miners .
[n addition to being compliant with the Kimberley Process
(KP) and international sanctions, Signet requires suppliers
to document purchase records and provide evidence of
a due diligence system, providing as much information
as possible about their subcontractors.
Suppliers are expected to provide a progress report on
compliance in 2016 and be subject to a third-party audit in
2017, whereupon they will be audited again every three years.
The D-SRSP is also harmonized with other diamond
auditing standards such as the De Beers Best Practice Principles

8 RapapOrT March 2016

and ALROSA's ALLlANCE Guidelines on Responsible

Business Practices, to avoid unnecessary audit duplication .
At the press conference, David Bouffard, vice president
of corporate affairs at Signet, said that Signet is not trying to
segregate suppliers in the industry of " good diamonds and bad
diamonds," as they were accused of similarly for gold back in
201 O. Bouffard highlighted that Signet did not lose a single
supplier when they enacted their gold standards, and said that
the new diamond standard seeks to achieve the same results .
Participants posed questions about the D-SR SP's feasibility
of establishing a system of warranties internationally, especially
in major trading areas such as India and Antwerp. In response
Bouffard assured that Signet and its partners have identified
potential bottlenecks, and will be working closely with
suppliers in those countries to ensure compliance.
Erik Jens, head of diamond and jewelry clients at bank
ABN AMRO,also speaking at the conference, felt that
Signet's move would ultimately improve the bankability of the
diamond industry. He explained that as consumer confidence
in diamonds increase due to greater transparency, financiers
would see the risk in investing in the diamond industry
minimized, potentially inviting greater financing.
[n other Signet news, the jeweler announced its plans
to delist from the London Stock Exchange (LSE). Signet
said that less than 1 percent of its annual trading volume
occurs on the LSE , and the monetary expense, regulatory
burdens and time spent to maintain LSE trading supersedes
any benefits. Shares will continue to be traded on the LSE
until March 11,2016 and cancelation will take effect on
March 14. Signet's shares will continue to be traded on the
New York Stock Exchange (NYSE).

MARCH 2016

"if you stop tllitlking of diamonds

as a commodity and start thinking

of them as unique, special,

oHe-'-?J-a-killd illdillidllais,
then they are Hot overpriced."
David Bennefl
Worldwide Chaimilltl ifSolheby's

]l'Wt'lry Division and Chairman of Swirzerland

Gmtva, Swirzl'rLmd

Martin R apaport goes one-on-one
with Sotheby's David Bennett to
discuss diamonds and the auction


Each auction is a carefully crafted
sale. So what are the advantages to
the trade when selling at auction?

In an open letter to the
Federal Trade Commission,
Martin Rapaport comments on
the proposed FTC Jewelry Guides.

28 M.!.D. LEADS
AWDC Launches New Databa.se;
Zimbabwe Seizes Diamond M ines;
Rapaport Adds Grading Service.

D e Beers R evenue Falls; BlueR ock
to Buy Diamond Resources.



Diamond Slump I-lits Botswana;

1 ,111-Carat Diamond Named;
SCIO Gets New CVD Patent.

Rough demand surged at the start
of2016 as polished inventories were
reduced in the second half of 2015 .
H owever, polished demand
remained sluggish.

10 Rapaport March 2016

MARCH 2016



Election year impact.
Market shim to more specialized good~.


Chinese New Year period challenging.
Economic, political
impact market.


56 INOlA
Inventory streamlines.
ALROSA 2015 production up,
sales down.
Rapaport Oiaroond Report ~ 0712-350; !S5N: 0746-9829)
is published monthly by Rapaport USA Inc.

Business mixed at Antwerp Fair.


Tucson is the gathering place for
colored gem~tone dealers and an
annual event that draws attendance
from all areas of the industry.

While some dealers came to
the annual Miami antique show
with low expectations, they left
cautiously optimistic.

The recent NY NOW gift show
revealed a shift in design trends.

133 East WanT! Springs, Las Vegas, Nevada 89119.

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to Rapaport Diamond Report by Diamond Research


and Marketing Institute LLC


Emphasizing the personal touch is
a priority at McCaskill & Company
in Destin, Florida.

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This month Rapaport Magaz ine asks
retailers, "What are you restocking
after the holidays?"



12 Rapaport March 2016



Volume 39 Nu mber 3

EDITOR IN CHIEF: Ambe r Michelle
EXECUTIVE EDITOR: Phyllis Schiller
U 5 RETAIL lara Ewen
HONG KONG: Mary Kavanagh
INDIA: Za inab A Morbiwala
RUSSIA: Svetlana Shelest
BELGIUM: Marc Goldstein

PHOTO EDITOR: luciena Kardonsk.y

- - he one thing that is certain in life is change. Sometimes

it happens gradually and other times it comes out of nowhere.
H...ight now, the U.S. consumer is in a changing mind-set.Back in
the 1980s, 1990s and at the turn of the Millennium, it was all about
conspicuous conswllption .. .bigger, better and more diamonds.Bling was the
thing.Then the world changed seemingly overnight when the recession of
2008 hit. Now the mind-set is about conscious consumption, which means
buying that which does no harm ~ a product that is safe for the environment
and no one was exploited in the process of producing the item.As a result
of this conscious consumerism, people are embracing experiences rather

VP MARKETING: Eileen Farrell

than materialsm. Perhaps as a backlash to being glued to computers and cell


phones, emailing and texting all day, consumers' interests have turn ed to


purchasing experiences ~ vacations, dining out ~ something that builds

Eileen Farrell
Tel: 646.572_8560: eileen@diamonds _net
Amber Michel le, Editor in (hief
Tel: 212 535.2283; amber@diamol"ldsl"let
The above editorial, design and marketing services
are provided to Rapaport Magazine by
Diamond Research and Marketing Institure LLC

420 Madison Avenue, 7th floor

New York., NY 10017
Tel: 212.354 ,9100
Fax: 2 12.840.0243
PUBLISHER: Martin Rapaport
Ezi Rapaport, Mordy Rapaport

relationships and creates conununity.These experiences are, ofcourse, shared

on social media, but it is the doing ofan activity that is important. A<; a jeweler,
you need to tap into this new mind-set and position your store as a place to
go for an experience. Help customers create a special moment through their

shopping, help them tell a story. If a man comes into your store looking for
an engagement ring, become part ofthe experience, select rings that he can
post on social media to get input from his friends, ask about the proposal
and provide suggestions for those men who are clueless, be part of what he

is doing.A woman may come into your store to buy a piece ofjewelry a<; a
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Dubai Diamond Exchal"lge
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lumeirah Lake Towers
Un it 2206, Kinwick. (entre Dubai, UAE
32 Hollywood Road
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(entral, Hong KOl"lg
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Diamond Exchange-, Jewelry Connoisseu"', RapNer-,
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Martin Rapaport,

reward for herself.Again,help her show the pieces she is comidering through
social media. Ask her questions about when and where she might wear a
piece, find out about her lifestyle, help her create a story about the piece she

is buying. Part ofthe experience ofbuyinga piece ofjewelry is also learning

about irs creation.Who designed it, what was the inspiration, where are
the stones from, does the diamond have a
special cut? Create the story with your
customer or even let the client help
design the piece. Make it a personal


and unique shoppin g experien ce

that your client will treasure as mu ch
as the jewelry that was purchased.
A happy customer will spread the
news ... on social media, ofcourse.

Editor in C hief
Rapaport March 2016 15

Rough demand surged at the start of 2016 as polished

inventories w ere reduced in the second half of 2015 .
How ever, polished demand remained sluggish .
- .. h e di amond marke t ha s
been characterized by scrong
rough tradin g and slu ggish
pol is h e d d e m an d sin ce
th e start of 20 16 . Th at has crea ted
som e un cer tai nty amon g dia m o nd
dealers as to w hich directio n the market
is heading.
" The rough market was exuberant in
January due to restocking and fa ctory
an d transac tion -dri ve n bu yin g, but
we typically have this ebb and fl ow
m omentum in the rough market," said
M arcel Pruwer, managing directo r of
International E cono mic Strategy (lES),
a consultant to the diamo nd ind ustry,
among others. " The qu estion is if it is
sustainable and how polished dem and
w ill be in three mo nths when the new
polish ed supply com es to market."
An es timated $1 billi o n worth o f
ro u gh entered th e m arket in Januar y,
m arkin g a signifi ca nt in crease fro m
th e second half of2 0 15 w h en d em and
slu mp ed . M anufac turers ex pla in e d
th ey n eed ro u gh to fill sh o rtages in
th e p olished m arket as a result of th e
18 Rapaport March 2016

30 p erce nt to 50 p erce n t d eclin e in

m anufacturing last year. They add ed
t h at ro u g h d em and is also p artl y
driven by a need to keep th eir facto ries
churni n g, as t h ey ca nn o t afford to
lose any m o re workers than th ey did
in 20 15.
Manufactu rers' p o li sh ed inventory
was d ep leted fo llow in g a sign ifi ca nt
declin e in ro u gh supply in th e latter
half of 2015. Therefore, while it takes
about three m o nth s fo r rou gh to b e
manufactured into polished and for new
production to enter the market, polished
pri ces continu ed to b e supp o rted by
shortages in February.
Po lish ed prices stab ilized , calmin g
th e uptren d w itn essed in th e p as t
three months. The R apNet Diamond
Index (RAP ITM) fo r 1-carat diam ond
edged up .3 percent during the period
Febru ary 1 to 22. RAPI fo r .3-carat
di am o nd s in crease d by .3 p erce nt ,
w hile RAPI fo r .5-carat diamond'i grew
.4 p ercent. RA P I fo r 3-carat diam o nds
d ecli n ed b y 1.6 p erce nt du rin g th e
period (see chart on opposite page, top).


Polished trading slowed as bu yers in
Asia Pacific took vacations during the
Chinese New Year festival. Dealers remain
cautious about com-umer demand given the
global economic envirorunent, particularly
with reports of decliningjewelry sales over
the Chinese NewYear season.

Chow Tai Fo ok, the largest j ewelry

retailer in the region, noted that weak
consumer sentiment for luxury goods
du e to C hina's economic slowdown and
recent stock market volatility weighed
negatively on its sales during th e season
(see full report on Chow Tai Foo k's
results on page 52).
D ealers therefore traveled to the
H o ng Kong Int ernation al J ewe llery
Show, which began on March 1, with
low expectations for the event. D emand
inAsia Pacific is slow asjewelry sales have
decli ned over the past year and retail
inventory levels remain high.
Rath er, global demand con tinu es
to b e supp o rred by the U .S. eve n as
trading remains below levels recorded
in previous years. Po lished imports to
rh e U.S . declined 10 percent yea r on
year ro $5 .4 billion in the fourrh quarter
of20 15 , w hil e polis h ed exp o rrs fe ll
13 percent to $3.9 billi o n (see chart at
right , bottom). Wholesalers are selling
off old inventory and trading is driven
by orde rs for spec ifi c goods rarher
rhan inve nt ory purchases . Overall,
consum er spending is cautio us, wi rh
rerailers expressing concern about the
economy in an election year an d that
a possible negative wealth effect from
declinin g sto ck markets will impact
luxury spending.

RapNet Diamond Index (RAPI'M)



1 2 3 4 5








ld .









The Ra pNet Diamond Index (RAPI "") is based on the average asking price in hundred $/ct. of
the 10 bestpriced diamonds, for the top 25 quality round diamonds (D-H, IF-VS2, GIA-graded,
RapSpec-A3 and better), which are offered for sale on RapNet-Ra paport Diamond Trading Network.

u.s. Polished Diamond Trade



-.;= :-J.-



en $3,000 -

:::J $2,000 -

~ $4,000 -


$1,000 -





Polished Imports


l- I-



Polished Exports

- r



- r- r-






Net Polished Imports

Based on data published by the U.S. Commerce Department.

Rapaport March 2016 19


De Beers Half-Year Revenue, Earnings











- -

I- -





l- I--


Other Sales _


Rough Sales -

Based on data published by Oe Beers and Anglo American.



Underlying Earnings


Therefore, businesses across the

distribution chain are maintaining a
cautious outlook for 2016, despite the
recent surge in rough demand . While
polished supply is expected to increase
signifi can tly in th e second quarter as
that new rough is prepared, De Beers is
expected to limit its rough supply in an
effort to stabilize the market.
"We're selling what our customers want
and need rather than doing anything that
might not be in ours or the industry's best
interests," Gareth Mostyn, D e Beers head
of strategy, told Bloomberg." The key for
us is to continue to build on improving
confidence through 2016."
Sightholders n oted there was good
demand for De Beers supply ahead of
the February sight, which was ongoing
at press time. They explained that there
was better value in D e Beers rough than
other sources after the company reduced
prices in Janu ary. ALROSA reportedly
kept pri ces unchanged at its February
sale, with its prices now unchanged
since August. Prices were similarly firm
at tenders and on the secondary market.
While rough demand remained robust
in February - and prices high - sales
are expected to fall below the heights
reached in January, when De Beers sold
$540 million worth of rough. Still, sales in
early 2016 marks a significant increase in
the company's performance in 2015, and
particularly during the tough second half.
De B ee r s rou gh sa l es slump e d
54 percent year on year to $1 .36 billion

20 Rapaport March 2016

in the second half 02015, which resulted

in a loss of$102 million compared to
p rofit of $454 mi llion a year earli er
(see chart on page 20) . Full-year rough
sales fell 37 percent to $4.1 billion, while
underlying earnings slumped 72 percent
to $258 million .
Similar declines were evident in the rough
trading centers, with Belgium's rough
inlpOrts down 32 percent to $4.77 billion
in the second half of last year and rough
exports declining by the same margin to
$5. 1 billion (see chart at right) .
T he latest data published about India's
diamond trade in Januar y confirmed
the upward trend in rough trading and
continued caution in the polished market.
India's rough imports rose 16 percent
year on year to $990 million during the
month, while polished exports slumped
42 percent to $1.04 billion, according
to provisional data published by the
Gem and Jewellery Export Promotion

Belgium's Biannual Rough Diamond Trade
















Rough Imports _


Rough Exports -




Net Rough Imports

Based on monthly data published by the Antwerp World Diamond Centre (AWDC).

Council (GJEPC).
De Beers management explained that
rough demand in 2016 will depend
on consumer demand for diamond
jewelry and the resultant levels of
restocking by retailers and, consequently,
the midstream .
At least in the first quarter, manufacturers
required some restocking as evident in the
recent surge in the rough market. However,
while the current polished price levels
reflect shortages in the market rather than
a rise in demand, there is an overriding
concern among diamond dealers about
how the market will evolve as polished
supply increases in the coming months
while overall demand remains weak .
Rapaport March 2016 21



The Antwerp World Diamond Centre (AWDC) has

teamed up with Bureau Van Dijk. a firm specializing in
company data gathering. to launch a free database to
help diamond traders comply with Belgian antimoney
laundering legislation. The law requires banks and diamond
traders to identify their clients, verify their identity and
conduct a risk analysis before transactions .The collaboration
with Bureau Van Dij k will allow traders to investigate who the
client is, risks associated with
the client's profile and the nature
of the business relationship,
said AWDC spokeswoman
M argaux D onckier. Besides
company information of
some 250 million businesses
worldwide, the database
also includes sanctions lists,
politically exposed persons
(PEP), media reports and a list
of Financial Action Task Force
(FATF) high~risk countries .

The Rapaport Group* launched a new diamond

grading report for investment-grade diamonds
titled the "Rapaport Investment Diamond Report"
(IDR). T he report grades diamonds based on the
Gemological Instinlte ofAmerica (G rA) standards and
includes additional information about tint, location and color
of inclusions. It al~o features high resolution images .The
IDR is double tested and includes an additional independent
GIA diamond grading report.The service will only grade round
diamonds .sO carats and larger, D to H color, IF toVS2 clarity,
of excellent cut, polish and symmetry - diamonds must meet
Rapaport gemologists' opinion of investment grade quality
stan d ard~. Diamond~ that do not meet the standards might not
be issued the IDR.

Margaux Dandie r


M.I.D. House ofDiatnonds Ltd. was Israel's top
exporter in 2015. according to a list released by the
Ministry of Economy and Industry's diamond controller.
The company exported $191 million of gems during the year,
lUlSeating Leo Schachter Diamonds Ltd. ,- the top exporter in
2014 - from the leading spot.The top ten companies exported
Sl .13 billion worth ofdiamonds combined:
M.I.D. H ouse of Diamonds Ltd .,S1 91 million.
A.A . R achminov Diamond~ (2000) Ltd .,S163 million.
Niru Diamonds Israel Ltd. , $155 million.
Leo Schachter Diamonds (1987) Ltd .,S150 million.
D.N. Diamonds 2007 Ltd., S128 million .
Ofer Mizrahi Diamonds Ltd.,S102 million .
Yoshfe Diamonds International Ltd., $74 million .
R osy Blue Sales Ltd ., $60 million.
Andre M essika Ltd., S54 million .
Moshe Namdar Masingita Ltd., $49 million.

28 Rapaport March 20 16


The Zimbabwe goverrunent has ordered eight mining
companies who did not renew their licenses to cease
operations and vacate their premises, reported Reuters.
At least six companies - Diamond Mining Company
(DMC),Anjin Investments,Jinan Mining, Kusena Diamonds,
Marange R esources and Mbada Diamonds - have refused
to leave. The seized mines will be taken over by the new
state-owned Zimbabwe Consolidated Diamond Company
(ZCD C) as these firms had not invested enough to continue
production beyond alluvial production, Mines and Mining
D evelopment MinisterWalter Chidhakwa said .
According to R euters, DM C said it intends to sue the
government for breach of contract over the attempt to eject
the companies. RanlZi Malik, a general manager at DMC, said
that its joint venrure contract with the Zimbabwe Mining
Development Corporation (ZMDC), the state mining arm,
stipulates that ZMDC was responsible for renewing licenses
and that the investment agreements were valid and indefinite.
The ZMDC is in joint venture with eight firms to mine in
Marange. Official~ from Mbada Diamonds and Chinese-run
Anjin Invesmlents said they were trying to persuade the
government to reconsider, reported R euters .
-Additional reportillg provided by A cquire Media.
*Rapaport Magaz ine is published by the Rapaport Group.


Anglo American PLC announced plans to streamline
its assets and improve cash flow to strengthen its
balance sheets. The mining company intend~ to focus on
De Beers - in which it holds an 85 percent interestplatinum group metals and copper. Mark Cutifani, CEO of
Anglo American, added that its workforce will eventually be
reduced to fewer than 5,000 roles,
down from 11,500 roles in 2016,
with cost savings estimated at
$250 million. The 2016 targets in
the new strategy include:
Positive free cash low at
current pnces .
$1.9 b illion earnings before interest
and tax (EB IT) .

D isposal~ totaling $3 billion to

$4 billion .
Net debt levels below S10 billion .
Mark Culirani
The new strategy would effectively
streamline its core portfolio of assets down to 16 from 45.
Anglo Am erican would seek to ensure there is no overreliance
from anyone product group or geography even as the
portfolio becom es smaller. De Beers will continue its
mining operations across B ot~wana, Canada , Namibia and
South Africa . D e Beers is also expected to complete the

development of its 51 percent-owned Gahcho Kue venture in

Canada, with production to begin in the second half of2016.

- Global consumer demand fell marginally in U.S. dollar

terms, according to the report.
- While the US., the largest market for polished diamonds
accou nting for 45 percent of global market value. saw
growth in 2015, it was at a lower rate.The growth was offiet
by soft economic slowdown in C hina and a strong U S. dollar.
While demand for diamond jewelry in China remained
stable. demand in India fell in local currency terms .
- The Forevermark diamond brand from D e Beers expanded
its reach by 14 percent and is now available in 1,760 outlets
across 35 markets. D e Beers also reported that Forevermark
achieved double-digit sales growth in 2015.
- The mining company expects the US. market to drive
growth of consumer demand in 2016 . Factors atTecting the
growth would include the strength of the currency and
the economic performance in C hina .
- D e B eers is hoping that the continued rise of the middle
class in the world's emerging m arket~, including India and
China, would positively impact the industry in the long term .
D e Beers expects to produce 26 million to 28 million carats
of diam onds in 2016 .
In other D e Beers news, th e miner's research company
International Institute of D iamond Grading & R esearch
(IIDGR) will otTer to grade non-Forevermark diamonds
from its UK. lab for the first time starting March 1,2016.
IIDGR has also launched a diamond grading service in
th e Far East, M iddle East, India and E urope.The service will
only grade natural, untreated diam onds, from it~ laboratories
in Belgium, India and the UK.


De Beers total revenue for 2015 fell 34 percent to
S4.7 billion. It is attributed to lower rough diamond sales
which plummeted 36 percent to 54.1 billion, according
to a prelitninary earnings report. Earnings before interest
and tax (EBIT) slumped 58 percent to $571 million . De Beers
has reduced production by 12 percent to 29 .7 million due to
weaker rough diamond demand, as well as trimm ed costs and
capital expendirure.The mining company, which employs
2,236 people. has decided to reduce its workforce by 189 positiom,
of which 68 need not be retrenched but redeployed eL~ewhere
instead or by natural attrition from retirements.

30 Rapaport March 20 16


U.K.-listed BlueRock Diamonds has approved
the purchase of Diamond Resources Pty Limited from
Tawana Resources. BlueRock will ai<;() loan Diamond R esources
$1 .4 million to settle an outstanding debt owed to Tawana
R esources. BlueR ock, which operates in South Africa.
had paid $45,454 for the shares in D iamond R esources.
and had purchased mining rights from Diamond R esources
in 2014 . Diamond R esources is a n ontrading company which
holds a rehabilitation guarantee required by the South African
government to operate the Kareevlei mine in Kimberley.



Laboratory-grown diamond producers,

distributors and retailers around the world have
partnered to form the International Grown Diamond
Association (IGDA). Claiming to be the first ever association
representing the grown diamond industry, IGDA aims to promote
laboratory~created diamonds as an alternative and educate
about qualities and applications oflabot'arory-grown diamonds.
The founding members include: Microwave Enterpri~es (MWE),
Iia Technologies,Washington Diamond~ Corporation,
New Diamond Technology, Scio Diam ond Technology
Corporation, Go1condia Cultured Diamonds,
Pure Grown Diamonds. Polished Diamond Company,
Diamond Foundry, MiaDonna & Company and
Chatham Created Gems & Diamonds. Richard Garard,
CEO ofMWE, was elected the secretary general of
the new organization .

Lucara Diamond Corp. announced in February

that the l , ltl-carat diamond recovered from
the Karowe mine in Botswana has been named
"Lesedi La Rona." The name, which means "Our Light"
in the local Setswana language, was picked as the winning
entry in a nanling competition held in January open o nly to
Botswana citizem, including the nliner's employees.
- Thembani M oiclhobogi from Mmadikola won the contest,
netting himself a $2,243 prize. His entry was one of m ore
than 11,000 submitted .
- Auditing firm Ernst &Young oversaw the nanling
competition to ensure fairness .
- The diamond was extracted in November 2015, and is the
second largest diamond ever recovered . rr is also the largest
diamond nlined in Botswana.


Laboratory-grown diamond producer
Scio Diamond Technology Corporation announced in
February that it received its 28th patent for its CVD
manufacturing process. Titled "Gemstone Production from
ChemicalVapor D eposition (CVD) Diamond Plate:' the
patent is a continuation of a previous application under the
same name. The patent claim~ to m aximize diamond yields
by geom etrica11y optinlizing preforms, such as growing
cylindrical CVD diamond~ from a round wafer to maxinlize
diamond yields for round-cut diam ond~. Scio Diamond
also claims to be the first firm to deliver C VD single-crystal
diamond plates, CVD diamond gems and one-inch square
single-crystal diamond wafers .

32 Rapaport March 20 16

Botswana's diamond export~ fell to its lowest in six years,

dropping 38 percent to $2 .4 billion in 2015, according to data
published by the Bank of Botswana.These fi gures do not include
diamond~ brought into the country by D e Beers for aggregation
and re-exports. Kenneth Matambo, minister offinance and
development planning, said in his 2016 budget speech that the
continued slowdown of growth in the global economy had
adversely impacted Botswana's domestic economy, reported
M megi Ol/lil/e. H e added that the Bank of Botswana revised
its econonlic forecast down to 1 percent from 2.6 percent
because of the weakness in the diamond industry.The majority
of Botswana 's diamond exports come from D ebswana, a j oint
venture between the government and D e Beers. D ebswana cut
its production 16 percent to 20.4 million carats in 2015.




Rapaport Comment on the Proposed FTC Jewelry Guides
"Jewelry Guides, 16 CFR Part 23, Project No. G711 001"
To: The Federal Trade Commission
Re: Stalldardizatioll of Dimno"d Grading Terminology
The Gemological Institute of America (GIA),
established in 1931 , created terminology to describe
the color and clarity of diamonds. So as to differentiate
their language from a broad range of confusing terms
that were commonly used in the trade, the GIA begins
their color grading scale using the letter 0 instead
of A, AA, AAA, etc. The GIA defines their diamond
grading terminology standards by grading millions of
diamonds each year and applying the GIA terminology
to their diamond grading reports. The GIA Gem Trade
Laboratory (GTL) maintains and uses master samples
to define various gemological characteristics such as
color, clarity, fluorescence, etc. The use of GIAdiamond
grading terminology has become the de facto language
used to describe diamond qualities and gemological
Over the years numerous additional and competitive
diamond grading laboratories have emerged. Almost
all use GIA terminology while applying GIA grading
standards. Unfortunately, in recent years, a number
of diamond grading laboratories have been issuing
diamond grading reports using GIAgrading terminology
to significantly overstate the color and clarity of
diamonds. Evidence of such deceptive practices has
been presented in a court case where two 3-carat
diamonds color graded as G by EGL International were
later graded by the GIAas Nand M colors-a disparity
of six to seven colors representing a $113,000 value
difference according to the lawsuit. Please note, that
while we will be using diamond color differentials to
highlightovergrading, such overgrading also takes place
regarding diamond quality, cut and other gemological
characteristics. The attached article, "Honest Grading,"
34 Rapaport March 20 16

published in the Rapaport Magazine, November 2014,

provides important additional information and is included
in this submission.
Unfortunately, the gross misrepresentation of
diamond quality by unscrupulous diamond laboratories,
dealers and retailers has become rampant. Hundreds of
thousands of consumers have been sold "overgraded"
diamonds, whose qualities have been misrepresented
through the fraudulent use of GIA grading terminology.
Such abuse is destroying a level playing field and
constitutes unfair competition.
An honest jeweler selling a legitimate honestly graded
G color diamond must charge a significantly higher
price than a dishonest jeweler offering the consumer
an overgraded G color. What is the jeweler to do?
Some are being forced to compete by overstating the
quality of the diamonds they sell and/or using fraudulent
grading reports that overstate quality. Furthermore, the
ability of consumers to competitively shop and compare
prices is being undermined . What are consumers
to do when faced with alternative grading reports or
representations , both of which claim a diamond is a G
color? They might naturally go for the less expensive
item , mistakenly thinking that a fair comparison has
been made. Finally, the value of an overgraded diamond
will be significantly less upon resale. Consumers are
being led to believe that the quality of what they have
purchased is significantly greater than what it actually
is. Upon resale , consumers will find out the true grade
of their diamonds and the resultant significant difference
in value. This will not only hurt the consumers but
also significantly reduce co nsumer confidence in all
diamonds, including honestly graded and fairly priced

diamonds from legitimate retailers. It should be clear that all of

the above point to unfair competition and consumer fraud.
Some of the entities overgrading diamonds try to justify their
actions by falsely claiming that since diamond grading requires
the subjective skill of a trained diamond grader there are no
diamond grading standards and they can therefore use GIA
terminology to misrepresent diamond qualities. While diamond
grading may in fact be subjective, such subjectivity is relevant
only within a reasonable tolerance range. Legitimate graders
might disagree about a one color or clarity difference but a
difference of five or six colors is outright misrepresentation and
fraud. No legitimate diamond grader would be off by more than
one color or clarity. Furthermore, retail jewelers are deemed to
be experts in their dealings with consumers; they should not be
allowed to misrepresent the quality of the diamonds they sell by
abusing GIA diamond grading terminology.
For all of the above reasons, this writer appeals to the Federal
Trade Commission (FTC) to make the following changes andl
or additions to the FTC Jewelry Guides.
lIt is an unfair business practice to communicate the grade
of a diamond using GIA terminology while applying non-GIA
standards that systematically overgrade the quality of a diamond.
a. Definition: An overgraded diamond is a diamond whose
quality is communicated by the seller using GIA terminology and
when graded by the GIA is found to be more than one color or
clarity below the grade represented by the seller.

2. Diamond sellers are responsible for the quality of the



Members ofthe diamond trade

are encouraged to communicate
directly with the Federal Trade
Commission (FTC) regarding
misrepresentation of diamond
quality. Please send an email or
letter supporting our submission
to the FTC and/or request that the
FTC add these two rules to their
1. Those using GIA terminology
must use GIA grading standards.
2. Those selling diamonds using
GIA terminology must provide
a refund if within one year the
diamond is graded by the GIA and
found to be more than one color,
clarity or cut grade below the grade
the seller communicated.

diamonds they sell. In the event that a seller describes a diamond

using GIA terminology and the diamond is graded by the GIA
and found to be more than one color or clarity below the grade
communicated by the seller, the buyer may return the diamond
to the seller within a period of one year and obtain a full refund.

Write "Jewelry Guides, 16 CFR

Part 23, Project No. G711001" on
your comment.

In the event that the Commission is concemed about the level

of diamond grading subjectivity, it may wish to modify the above
rules by allowing for a two color or clarity differential.
Please note, in the event that the Commission is unable to
include the above rules , I request the following addition to the
uThe standard for diamond grading when using GIA
terminology shall be the results generated by the GIA Gem
Trade Laboratory.~
In the event that the Commission holds any hearings regarding
changes to the rules , please notify me, as I would like to attend.

Or mail your comment to:

Federal Trade Commission
Office of the Secretary
600 Pennsylvania Avenue NW
Suite CC-5610 (Annex 0)
Washington, DC 20580

File comment online at:


Thank yolt for your time and consideration.

Martin Rapaport
Charimall, Rapaport Croup
Rapaport March 2016 35




avid Bennett, worldwide chai rman of
Sotheby's jewelry division and chairman
of Switzerland, made jewelry history once
again when he sold th e Blu e Moon of Josephin e
diamond for $48.5 million in November 2015 - the
most expen sive diamond or gemstone ever so ld at
auction. Known as the "tOO-carat Man," B ennett has
sold seven tOO-carat diamonds during the span of his
36 Rapaport March 2016


four-decade career at Sotheby's. H e has handled som e of

the world's most important historical jewels, including
the collections of the Duchess of Windsor, Ava Gardner
and the Beau Saney diamond, which once belonged

to H enry IV of Fran ce. Mter th e fall auction season

closed this pas t December, B enn ett sat down with
Martin Rapaport at Sotheby's N ewYork for this exclusive
interview about diam ond" and the auction market.

Martin Rapaport: How is the jewelry auction business?

David Bennett: It's been an extraordinary year.The May
auction in Geneva was a record sale of$160,914,902.
We had the Blue Moon ofJosephine beating the Graff
Pink, very exciting, and we had the tOO-carat D IF in
New York. The jewelry market is extremely good at
auction. Toward the end of the year, there was a slight,
slight, softening in large white diamonds .
MR: Is it because all ofa sllddwjantastic stones have appeared?
DB: Most of the private sellers are one-off sellers. They
come, they sell what they have and that's it. You never
really see them again.The opportunity effect is very hard
to predict. If we visit Munich for example, it might be
just at the right moment when a particular individual is
thinking ofsellingjewelry she inherited from her mother.
We don't really know when and where sellers offantastic
items will appear.
MR: Are t!tere a lot ifsuppliers in the trade who are produdllg
magnificent diamolldsforyou? Do tltey know ill advance, wltell
they buy tlte rough, that auction is tlte way they're going to sell
the diamond?
DB: We've had considerable success in selling dreamti cket co lored and white diamonds. We have built
relationships with some of the cu tters.When we see a
big rough diamond coming onto the market, we follow
it. The Blue Moon seemed , right from the moment it
was discovered, to be a stone that would attract a huge
amount of attention. It is also, I think, the most beautifitl
blu e diamond I've ever seen,We want to remind people
of the magi c, history, glamour and luxury of these
wonderful treasures.
The campaign we designed around the Blue Moon
was precisely that. We made two films to illustrate th
wonder ofthis extraordinary stone that had been sleeping
miles beneath the earth 's surface for billions of years.
Suddenly, at this one moment, in a fraction of a second
in time, the diamond is brought up to the surface by pure
chance, with a volcano. It's that mystery that we as an
industry need to remember, because that's what makes
people dream about owning diamonds. Somehow, we've
become very blase .The industry, particularly the clientfacing part of the industry, has to remember these things
are objects of desire and have to remain objects of desire.
Otherwise people, clearly, will stop desiring them .

MR: So Sotheby 's adds vallie to diamonds by romal/cillg

tlte stolle?
DB: That's what I try to do. It's been important to me
to place every stone that I've offered over the years in a
context of rarity, beauty and historical importance and
to somehow bring the magic out of the stone.
MR: So who are the buyers of these very rare and special
DB: The one thing they have in conUllon is, of course,
that they have the funds to buy these items. Sometimes
people don't know what they want until they see it.
When I sold a 25-carat ruby in 20t5 for a huge price
- three times more than any other ruby has ever sold
for- the biggest challenge was exciting people about it,
because nobody had ever seen a 25-carat pigeon blood
Burma ntby before. So they didn't know that they wanted
it. I talked to one particular individual and he was saying
to me, "A ruby, huh?" He hadn't thought about buying
a ruby. I showed the ruby to him and he said, "Wow,
that is really fabulous, I've never seen anything like it."
I said, "You've got a point, because in 40 years in this
business I've also never seen anything like it." H e asked,
" H ow much should I pay for it?" I said, "There isn't a
price for this stone. All I can do is try and tell you how
wonderful it is."
The best way to define something as being beautiful is
to show it - by explaining to him how rare it was and
showing him it" beauty and by detailing the history of
the stone. Once he understood all these things, he ended
up bidding. H e didn't buy it, but he was a very important
part of the underbidding process. There isn't anyone
particular buyer because in the end, ir's somebody who
enters into the magic of this world of extremely rare
natural treasures who buys the stone.
MR: How important are olltside experts wlto call understand tlte
Imiqllelless, spedalness and rarity ofagemstolle? Is there eliot/gil
gemological knowledge Ollt there to sllccesifillly dtfferwtiate and
value these multimillion-dollar pieces?
DB: If you're thinking of buying a gemstone, you need
an advisor who's seen a lot of stones. H e can relate it
to specific points of reference that he has seen with his
own eyes. I think that's hugely important. The ruby is a
very good example. A pigeon blood ruby is not an exact
definition of color. It's sort of an agreed upon term that

Rapaport March 2016 37

the trade uses to describe a particular, very small spectrwn of the red end of the
color scale. So you really need to determine if this is a good pigeon blood.The
only way you can determine ifsomething is good or exceptional is by mentally
comparing it w ith many other top-quality stones you've seen. A laboratory
certificate is not going to do that.
The same is true for colored diamonds . In my experien ce, no blue diamond
is like another one.A blu e diamond can only refer to other blue diamonds. It's
not like any other gemstone. Don't think a blue diamond is going to look like
a sapphire. It's an entirely different and special color and gem.We have to stop
thinking of particular types of colored diamonds, particularly blue, pink, as a
category of gemstones - they're individuals.

MR: Are the buyers if tlte stones mostly trade?

DB:A stone that needs repairing or to be recut to improve its quality; very
often will go to somebody in the industry. Certain types ofo ld colored
diamonds are susceptible to being recut to improve the color or
appearance. But w h en a stone is finished like the Blue Moon,
it absolutely goes to a private.
MR: COl/ld YOIl explain why these historical prices are being
made at a time when the global economy has beell very weak?
DB: E ven though there may b e a general economic
malaise, a lot of people are making a lot of money
and are very cash-rich. Fine gemst ones have always
b een something that people consider having in their
portfolio of investments . If they are going to buy
something, they want to buy the rarest, the best. In
my experience, in this market now,it's ten times easier,
no matter what the price, to sell the rarest and the best
than it is to sell the second best or the third b est, where
price suddenly becomes an issue.

Beau Saney

MR: Do YOIl think tltat the economic l/ncertaillty is flleling

demand? Political lltlrest in the Middle East, Hncertainty about
the Chinese ecot/omy at/d the Chinese government cracking down on
comlption: Is that drivi"g demand?
DB: The fi st 100-carat D IF diamond that I took for sale arrived at what was
conceivably the worst moment. Saddam Hussein h ad just invaded Kuwait.
The underbidder of that stone was a person who was attracted to the diamond
because, as he said to me,"How else can I put $12 million in my pocket?" That's
portability. Great diamonds and colored stones have b een admired, valued,
esteemed and collected by the richest and most powerful for as lon g as history
has been recorded .There's a pretty good likelih ood that this will continue.
MR: Do you feel that the kind if magnificent jewelry that YOIl sell, partiwlarly to very
wealthy people, is a reaUsac and a reasonable form if diversificaaon of assets?
DB: That's not for me to judge. There are people who think like that. People
that I sp eak to say real estate, jewels and gold in some cases are all p ossible
interesting areas of investment. Whether jewelry is a long-term investment,

38 Rapaport March 20 16

I don't know, but it hasn't performed badly in the past

2,000 to 3,000 years!

MR: vVlIat adds value, the history, owner or maker of a piece?

VVlJat percentage of the vallie is attributable to these kinds
DB: A good example would be the Duchess of Windsor
sale. It's the fi st sale that was very heavily mediatized and
followed. Lot 15 was a pair of the Duke's cufflinks tha
we estimated j ust on its intrinsic value. It was a Cartier set
estimated at $15,000 to $20,000 and it sold for 50 times
the estimate because it had been the King's cufflink set.
If you went out today to buy some cuffiinks fo merly
owned by the King of England, you would have a great
deal of trouble finding them. Sometimes provenance, the
history of the item or the previous ownership, can make
a piece very desirable and valuable.
There was the Beau Sancy. The diamond had been
cut in the late-sixteenth century and had been bought
in 1604 by Henry IV of France and given to his wife
Marie de Medicis to wear in her crown for the coronation
in Saint Denis cathedral in Paris.That stone was magical.
A lady rang me up before the sale and asked to see the
Beau Sancy. I opened the box, she took a look, gasped
and burst into tears . It was such an extraordinary emotion.
It's a kind of visceral emotional response that I think
separates a stone like that from all the rest. It was a stone
that had been owned by four royal houses, including
the British. It was an off-color SI2 stone. The stone was
cut in this extraordinary way. It was easy to imagine the
cutter, in Amsterdam, cutting it by hand.When Henry IV
bought it,it was the most valuable stone in the worldYou
can have diamonds where the value is unrelated to the
history ofthe object.And you can have diamonds where
the value is all about the history.
MR: VVhat about regular jewelry? Mrs.jones passes away and
her daughters want to sell it. Vf;'hat about that market?
DB: Well, that's very much a major part of our market. I
mean, this year we've had a very good sell-through rate.
Either we're doing something very, very well, which is
getting the price right, or the market is very healthy and
there's a lot of demand. Perhaps both.
MR : Are there jewelry collectors? How do brands play into
this? If a piece is Van Cleif & Arpels or Tiffany & Co. or
Harry WinstOIl, how much value will that add?
DB: Collecting is about desire. There are people who
collect, for example, pieces by Belperron.

MR: Brands also play an important role. For example, if YOIl

had an unbranded gmeric diamond ring alld a CrqIJ ring at
auctioll, most people would go for the Crqff ring, because it's a
standard of excellence. The quesaon is how much more would
they pay?
DB: That's really a question of the competition . I think
the brands attract and focus much more attention on the
item.The important thing at an auction is to get people's
interest started. Once you've got people started, there are
all sorts of psychological imperatives that may keep them
going. Having a signed ring is more likely to have more
people after it.
MR: You )ve made historical prices for fmley colors. Even in this
economic environment) everyone's exdted aboHtfatuy colors but
the same level of exdtement is tlot there for whites. Why do
YOII think falley colors have taken cijJ while white diamollds are
DB: It goes back to the fact that we need to give more
attention to marketing white diamonds. All the record
prices, almost without exception, have been for colored
diamonds. The ruby came close. It was $30 million, not
far away. Colored diamonds are very beautiful. A pink
diamond is an absolutely charming, entrancing stone. A
blue diamond is mysterious and wonderful.Whereas with
a white diamond, until you put it in front of somebody,
put it in somebody's hand, it is difficult to ima ine, as
most people are never going to have an opportunity to
hold a 30-carat-plus D fl wiess gem. I sold a couple of
very large stones in 2015 for very high prices to a private
collector and it was simply a question of talking about it,
explaining it and putting it on their finge , and then it's
"wow." I think it's the wow that is ultinutely the thing
that sells the diamond. T he wow is an experience. You
have to understand how big a 30-carat diamond is, or a
50-carat or a 100-carat.
MR: Arefimey c%r diamonds overpriced? Is there a bubble today?
DB: I don't think so. If you stop thinking of diamonds
as a conunodity and start thinking of them as unique,
special, one-of-a-kind individuals, then of course they
are not overpriced.
MR: Is there an issue if cOllspiwous cOllsumption, so that the
more expetlsive the dial/Wilds are, the more people want to buy
DB: For certain groups of people, headline auctions and
publicity are very important. It nukes the diamond more
desirable. I think that's all part of it.
Rapaport March 2016 39

MR: D o the auction /tOl/ses appraise jewelry? Hillen you appraise it, is there any
conflict if interest?
DB: B ecause I've worked so long in the auction business, I have a very high
opinion of the process . Selling at auction is a wonderful process. It b eats
m ost oth er ways of selling things, b ecause fi st of all, it takes the worry out
of it, you 're presenting it to an international audience on a very sophisticated
and open platform.The other thing I like about the auction busin ess is that
the seller and th e auctioneer are on the same side. The simple dynamic is
the more we sell it for, the more conunission we make. It's not like we're
trying to beat people down. In my experience, the least su ccessful auction
examples are w h en people have insisted on very high reserves that we've
counseled against. If I were selling at au ction , I'd put a very low reserve and
let the auction take effect.

e want to
remind people
of the mag ie,
glamour and
luxury of these
- David Bennett

MR: What-s tlte mostJantastic piece ifjetIJeiry you've ever seen?

DB: Th e B eau Sancy. It left me speechless.What history. You 're the King
of France and you send som eon e to n egotiat e the purch ase of the most
valuable diamond in the world. Can you imagine that? There it was an d it
weigh ed 30-something carab. 100 percent Golconda. It's the only diam ond
sold in recent years that is 100 percent Golconda. It could not have com e
from anywhere else.
MR: f.Vh at-s going to happCII next year? D o you expect this tren d toward very
expensive diamollds sold at historical prices to continue?
DB: I think if the market or mines continue to produce very rare colored
diamonds, there's going to be a continuing market for them. I really don't
see any lack of demand, bur ie's only for these very, very rare gems Very high
levels of excellence that we can attach to somethin g is extremely important
and I think the market for excellen ce is going to continu e. For the rest of
the market , it's really more a question of what happens economically in the
world. It's a qu estion of how mu ch free m on ey is available.You and I may
b e sitting h ere in a year's time with an economy that's gon e into a maj or
recession, who knows? I think the American market is going to be ver y
important n ext year. But there will be new emergin g markets, I'm certain
ofit. I think India has massive potential. If India can stop its punitive import
taxes, it could be the biggest market in the world . If the Indian economy is
loosened up and allowed to perform, it would be fantastic. You don't have
to explain anything to Indians about colored ston es and diamonds; it's in
their blood.
MR: D o YO II think white diamonds will come back?
DB: I d on't think th ey've gon e. I think maybe at the moment, colo red
diamonds are the fashion. All the papers are always talking about colored
diamonds with articles abo ut how colored diamonds have gone up in price.
There has been less publicity about white diamonds . I think the diamond
industry must get behind promoting white diamonds .When it com es to the
top end ofthe market, we must stop treating these diamonds as conunodities
and instead treat each inlportant diamond as th e individual it is.

40 Rapaport March 2016



0/ tlte


SINCE 1835
608 Fifth Avenue New York , NY 10020 212-541 -7202 800-525-3250


Each auction is a carefully

crafted sale. So w hat are
the advantages to the trade
w hen selling at auction ?

very jewelry aucti on is a well-choreograph ed

perfor ma n ce, a p erfect balan ce o f se ll ers
and bu yers, with th e au cti onee r being th e
conductor o f the myriad players contributing to
the overall event. But, like any perfo rmance, much of the
hard work takes place behind the curtains, out of sight
of the audience. T hat is w here decisions are m ade about
which goods to take in for sale, where to place them in
the sale and how to set the estimates, all with an eye to
reaching a hoped- for do llar am o unt.
At th e sa m e tim e, au cti ons ha ve b eco m e publi c
spectacles, drawing the curious and th e well-heeled, the
private cli ents and the dealers, the celebrities and the
socialites. This has helped auctio neers find fresh go ods
fro m private consignors . In addition, the rrade ~ often
buyers at auction ~ aho provides a steady supply of goods.
Acco rding to Gary Sc hul er, direc tor of th e j ewelry
department at Soth eby's, " Most dealers will tell yo u
we are th e best retail ers in th e world. We are turning
inventory four times a year in New York." R etail stores
rarely reach that level, which is crucial to presenting fresh
goods to potential bu yers.
To accomplish this, Schul er says, "Wh at we like to
see coming in are very special goods." Those goods will
reach the greatest audience, on a global scale, no matter
where the sale is held. Selected highlights of upcoming
au cti o ns travel to key ve nu es, in clud ing Ge n eva,
N ew York and Hong Kong, and catalogs are available
online, reaching many more potential buyers. Diamond
cutter Isaac Wolf says the global reach of th e aucti on
houses is an unsurpassed marketing tool for dealers who
place their rare and special goods in the sales.
Au ction houses are for select dealer goods. Schuler
says, "We do have a good sense of w hat we can sell ~
42 Rapaport March 2016

we know our audience and what they have an appetite

fo r." H e elaborates, "Our sales are curated .There is no
need to fill up a sal e with undesirable items. It affects
the look of the catalog and the mood of the sale.We are
merchandisers as much as specialists.We are not the venue
for everything."
Still, it is a very rare sale that is 100 percent sold.That
honor goes to the unique estates: the Duchess of Windsor,
Elizab eth Taylor or a society fi gure with a very high
recognition factor among the public. M ost j ewelry sales
are 75 percent to 80 perce nt sold by lot, still a good
batting average for a one-day event.

While the trade is a consistent seller at auction, giving

them their daily bread and butter, it is th e estates and
private goods from collectors that offer the most desirable
goods that give th e auctions their flair.
Goods come in from mom-and- pop stores in smalltown America, as well as the nationally known renowned
names. R etailers' customers turn to them to sell goods,
often inh er ite d jewelry, th ey do n 't want . In so m e
instances, the retailers offer those goods to the auction
houses. AI Molina, chairman and chief executive officer
(CEO) of both M olina FineJewelers in Phoenix,Arizona,
and Black, Starr & Frost, with stores in Newport Beach ,
California, and Phoenix, says that when his clients come
to him with goods to sell, he has two options." lfthe client
needs cash, I will buy it outright. But we may be allowed
to represent them in an auction." M olina th en acts as
the middleman , negotiating with the auction house, and
then allowing the client to decide whether the estimate
suggested by the auction house is acceptable.
Auction houses have regular relationships \vith retailers,

w ho often bring th em fresh goods, sometim es items

that have been in private hands for generations. This is a
win-win siruation for all concerned. All three parties have
something to gain ~ the auction house has a desirable
offering, the retailer creates a cash flow for his client and
the client bene6.t~ from the expertise of both entities.To
be successfitl in using the auctions as an outlet, Molina
says, "You have to be a student of the auctions." From a
family ofj ewelers, he was 8 years old when he attended
his first auction.

Th e trade is a regular source of goods for aucti on

houses, with some dealers signed up with annual contracts
that state they will provide a minimum dollar amount of
goods, according to Rahul Kadakia, international head
ofjewelry for C hristie's. Conunission arrangements are

widely negotiated down from the standard 6 percent of

the hanuner price and depend on the value of the goods
as well as the volume and frequency of the consigrun ents.
Whether the consignment comes from a private client
or the trade, there are additional fees to cover risk ofloss
and photography for the catalog.
Diamond cutters, too, sometimes turn to the auction
houses when they have extraordinary goods to sell. "We
seek a balance ofgoods," says Kadakia. "This is a very fluid
process.We won't take another lO-carat D flawless if we
have one in the sale," he says,"We are looking for balance
among all the categories." According to Kadakia, it is
important to limit the appearance of these stones on the
market so as not to decrease the sense of absolute rarity.
Kadakia continu es, " Diamond cutters ask us which
shape and size they should cut, which product would
be a salable diamond and would make more money.

They ask if they should make two stones, for

example, to make a pair.We try to think where
we should place each gem- certain stones are
better in certain parts of the world.This helps
the buyer and seller."
Sometimes, if th e au ctio n houses see an
o pp o rtunity, th ey reach out to the trade .
Saul Go ld berg of William Goldberg, th e
New York Ciry-based diamond cutter and dealer
known for its Ashoka cut, would never cut a stone
to put it into the auction but the auction houses do
come to them for special goods. "They are very clear
about what th ey like. 'Do you have a 5-carat pink?' they
will ask. Their catalogs are not put together by accident,"
says Goldberg.
The history ofrecent sales also guides the process of deciding what
goods to take in. Kadakia says, "We know how many people were bidding
and how much cash was available fro m under-bidders."This suggests that
the market is still hungry for certain rypes of goods, as seen in the constantly
escalating prices of pink and blue diamonds.
When C hristie's began 250 years ago, Kadakia points out, the sellers were
estates or royal families. D ealers didn't have access to the royal houses.That
has changed over the past 40 to 50 years, as dealers began selling to other
dealers through the auction houses. In the heyday of Middle East buying in
the late 1980s/early 1990s, he says,"A lot of the goods that Ahmed Fitaihi and
Robert M oua\-vad - two prominent Middle East dealers catering to the royal
families of their own region - were buying goods from other dealers ."
Whether goods com e from dealers or privates, for a business known for its
secrecy, auction houses offer a tremendous advantage over dealer-to-dealer
sales: The transactions are totally transparent. The hanuner price plus buyer's
commission is known to the penny and the settlement date - 35 days from
date of sale - is also known. There is no holding back payment, no chasing
after money owed, no returns. In an unsettled economy, such as exists today,
this is very reassuring for a seller of high- priced good". For most consignors,
this advantage far outweighs the time lag between consignment and sale,
w hich can be anywhere from two to four months. Holding goods costs money,
including fin ance charges on bank loans and insurance fees, but putting goods
into auctions means at least a 75 percent chance the item will sell.There is no
other venue that offers that assurance along with the global marketing reach
and stellar customer service an auction house provides .

44 Rapaport March 2016

Election Year Impact


It's all election year, and some scores

were already feeling the ensuing
customer caution, with slow sal<.->s and light
traffic.Although custom pieces, especially
custom rcmount~, were doing well, new
purchases were sluggish. Additionally,
more customers were paying in cash. This
slight pullback led some retailers to
question whether rhey were doing all
they could to capture new Millennial
customers. Stores that have expanded
their technological footprim have found
it easier [Q attract and interact with
younge r customers. However, most
owners indicated that after the election is
decided in November, one way or another,
they expected to sec sales stabilize.


Although some stores felt rhe impact
of elections even in 2015, the rca! bmnt
of the cycle began in early 20 16 . "An
election year is always one of concern
because o f the uncertainty of a leader,"
said Tonia Leitzel Ulsh, chief operating
officer (COO) of Mountz Jewelers, with
three stores in Pennsylvania. " T his affects
spending of the middle-aged consumer
and Boomers. T he good news is there will
still be people falling in love and couples
getting married. I have found the biggest
concem of the Millennials who are making
bridal purchases is debt because of their
student 10an~.Their debt has them deciding
where to spend the little money they have,
and high-end jewelry is not a priority.The
debt is so high that decision~ on spending
will last through much of their aduk life."
Cash purchases and credit issues also
impacted consumer behavior in Bozeman,
Montana, where Babs Noelle, owner of
Alara Jewelry, noticed changes in how her
cus t omers spen.
d "m
I 'getung
an unusuaI
number of cash tran~actions," she said. "1
sense a difference in the retail consumer.
If they have the cash, they want to spend
cash and not apply for outside credit. T hat
said, for us, things arc going really well.
My whole year in 2015 was good.And for
2016, based on January and so far, Febmary,
. ,s a pretty rosy picture.

48 Rapaport March 2016

Even stoR'S that \vere seeing improvements

saw slower traffic over the past several
months. "Christmas 2015 was up about
4 percent, which is better than being
down," said Kevin Gorkofsky, owner
of Kevin Edward J ewelers in Avon,
Connecticm. "20 15 overall was aho about
3 percent to 4 percent up. But we're seeing
less foot traffic now. Sales have been a little
larger, but margins are lower."
And ofcourse, the election continued to
be an issue countrywide. "Christmas 2015
was down about 5 percent)'L'aron year," said
Richard Lee Mathi~, owner of Symmetry
Jewelers in New Orlean~, Louisiana ."I think
people are going to be holding back until
after the presidential election."
EveAlfill6,ownerof Eve J.Alfille Gallery
and Studio in Evanston , Illinois, a Chicago
suburb, noted election year concerns arc
not so much about specific issues as about
an overall sense of uncertainty. " In my
exper ience, an election year is never a
good business year," she said . "Customer
attention is elsewhere, and it forces people
to grapple with larger issues, and the
economy as a whole." For Alfi1l6 , that
grappling began back in late 2015 . " Last
year was a little disappointing at the end
of the year. I think that's probably tme of
a lot of businesses. T he 2015 holiday msh
wasn't much of a msh,and the volume was
down . Overall, the pace was slow."

shoppers to take a hands-on approach to

the design of their jewelry, has increased
her salcs."My customers arc going a lot for
something that's experience-based, which
is how the whole consumer economy is
going," she said."We have a CounterSketch
CAD system that gives my customers an
experience, and lets them design things.
Obviously, I go and fix it to make sure it
works, bm then they get a certificate saying
they designed the piece and they really
respond well to that. And overall, the stuff
that seems much more unusual and techie is
working well for me. For instance, the smart
Galatea Momento Pearh are very popular."
It's not only about finding new producL~
and clever technology, though . Capturing
younger customers is also about interacting
w ith them on their terms. An updated
online presence was key for Mathis. "We
improved the website, and w e're selling
more that way, and getting an initial contact
online," he said . "Now we're able to send
artwork and quotes without customers
even coming in." +


One of the biggcrproblelU~ store owners
mulled was how to capture a disinterested
Millennia! market. Gorko[~ky explained,
" I feel like the generation who bought
jewelry is getting older, and they have
their basics, so it's very hard to keep fmding
things that are going to intrigue them. Plus,
thLxy get to another stage in their lives and
they don't need jewelry anymore. And
for the younger generation,jewciry isn't
as important to them as electronics and
vacations and good times. So the industry
needs to figure out how to get the younger
people in."
Noelle said that enhancing in-store
customer experiences, such as allowing her

Ro u nds ar e best sellers, pr incess and

cush ion co m ing in seco nd . Ovals,
especia lly in Ea stWest setti ngs, are
trending, as are cocked pea rs .
Light ca r at s and 1-ca rat sto nes are
sel ling best, w ith . 75-carat stones do ing
well beca use of b udget co ncerns.
511 and VS2 are t ied for most popular clarity.

G/H rema ins the most popular co lor range.

l4-ka rat and l8 karat wh ite gold tie f or
to p-selling metal, whi le rose, pin k and
yellow gold conti nue to t rend .
The avera ge price for an engagement ring,
including stone and setti ng, is $7,011.

Market Shifts to More Specialized Goods


Wholesalers dealing in diamonds

around 1 carat, G to I colors, in
VS and $1 clarities - typically known as

commercial goods - had a harder time

making sales i n recent months than
traders working with bigger sizes and
better quality. "The Christmas season is
typically about larger stones about 2 carat~
to 3 carats and then it's back to commercial
goods for engagement sales in January,"
saidAnim Dcsai,pR'SidcntofStarGcms Inc.,

a whok'lialer in Norcross, Georgia. Sellers

did notice the switch back to engagement
sales after the holiday season, but the
performance of l-carat commercialquality diamonds remained subdued .
"While sales have picked up a little in
February from January, generally business
has gone down quite a hit compared


2015," pointed out Harold Apfelbaum,

president of ValuExchange, a wholesaler
in San Francisco, California. Bigger sizes
and better-quality diamonds sold better
- G lA-certified triple EX cut goods up
to the 4-carat to 5-carat range, F color and
VVS andVS clarities.
Desai reported a phenomenal start
to 2016. H e nmiced a trend for custom
makes and his company is launching a
business-to-business (B2B) mobile app to
capitalize on the momentum. " It's niche,
and maimaining inventory is tough, but
you're able to get the right prict'S with fewer
goods around," Dt'Sai noted. H e added that
retailers have said customers are comrantly
looking to make changt'S or want something
unique, especially for engagement r ings.
Kushal Sacheti, chief executive officer
(CEO) of Galaxy USA Inc., a wholesaler
specializing in colored diamonds,
highlighted that mom-and-pop diamond
jewelers are not doing well, affecting rhe
low end of the market. " Business has taken
a beating, unless you are in the very high
end of the market,"Sacheti said . However,
he pointed out that while demand in
the high-end market remains relatively
unchanged, sourcing for that particular
market can be challenging price-wise.

SO Rapaport March 2016


Sourcing for bigger and better-quality
stones becomes increasingly challenging as
manufacturing in the industry has been cut.
However, many diamantaiJ"t'S were not that
concerned - in fact some welcomed it,
saying it would help make prices favorable
for them. "Prices had softened in the past
and now they're finally readjusting," said
Desai."As the demand for triple EX goods
remains, prices will cvenrually rise due to a
scarcity ofsupply,"he added. Saul Goldberg,
president of William Goldberg Diamond
Corp., a wholesaler in New York City,
said that a shortage might not necessarily
be a bad thing. " It has created more of
a buzz around in the industry as people
become more semitive to prices," he said,
explaining that buyers' understanding of
an impending scarcity gave sellers a better
bargaining chip.
The looming scarcity also has another
benefit - a potential shortage has allowed
lower colors to be accepted back into the
market as in-demand goods start to run
out. Sacheti noticed that G through I colors
were the bread-and-butter of diamonds
sold, but now the main mix might have
shifted to H through L colors.
Some sellers felt that the wholesale
industry as a whole has undergone a
fundamental shift due [0 technological
advances and globalization . "Buyers are
increasingly buying as they need, and the
role of rhe middleman seems to have been
cut out," said Sacheti . Many jewelers are
able to directly contact wholesalers, cutters
and manufacturers these days, squeezing
out traders who do no manufacturing. As
a J"t'sulr,Sacheti said that traders like him.self
are restructuring the way they do business,
and are specializing in specific fields .
Apfelbaum was concerned how
consumer-facing businesses might be
affected by online jewelers and laboratorycreated diamonds."You can see them offer
prices 10 percent to 20 percent off of what
we offer because they can," he remarked.
Apfelbaum believes that the Millennial

generation perceivt'S diamond engagement

rings - a staple of commercial goods differently. "They're not as into diamond
engagement rings the same way the older
generation is. They're all concerned about
'blood diamonds' and lab-created diamonds
these days it seems," he commented.
Diamantaires were not sure what to
make of 2016 moving forward. Desai
predicts that 2016 will be stronger than
2015, and that sellers catering to the niche
market will fare better. Goldberg felt that
it was too early to tell, though he feels that
sticking with bigger-ticket, higher-quality
goods might be the way ahead." April and
May will probably be very slow, since
that's d uring the tax season," speculated
Raffi Meric, co-owner of JD Diamonds,
a wholesaler in San Francisco, California.
Apfelbaum echoed that sentiment." It will
probably be flat for the next few months,
and then hopefully it will start to pick up,"
he concluded .

Diamonds 1.25 carats to 3 carats, DG color in

VS clarity sold strongest, big st on es in
4 carats to 5 carats sold w ell. Demand for
trip le EX cuts and WS cla rity increased
as we ll.
Diamonds weighing.S ca rats upto 1 carat
in commercia l qualities moved slowly.
Rounds dominated sales. In fancy shapes,
ovals and cushions w ere most popular.
Some sellers reported requests for shapes
not commonly asked for, including hearts
and emera lds.
Diamantaires reported prices have
been close to what they ask for, and
the demand for steep d iscounts
seemed to have coole d off a little as
supply becomes t ighter.

Chinese New Year Period Challenging


Hong Kongen; were told to embrace

the "good omens" in the Year of
the Monkey during a New Year ritual at
Chc Kung Temple where a lucky stick
bearing the number 72 was drawn. "The
stick tell~ us that Hong Kong has to stay
united and harmonious," said Kenneth Lau
Ip-keung, chairman ofHcungYcc Kuk, a
government advisory body, who drew the
stick. According to the annual ritual, the
coming 12 months will bring luck for
Hong Kong. This positive message
came only hours after the city saw its
most violent clashes between police and
protesters since the Occupy Central
movement in faU2014.The riot~ started
in the densely populated district of
Mong Kok when efforts by food and
hygiene officials to clear the area of
illegal food stalls spiraled out of control
leaving approximately 130 people injured,
including 90 police officers Those involved
in the rioting have since come under attack
from both Hong Kong and Chinese
government officiaL~ and investigations are
ongoing. There were no further such
incidents over the holiday period.


In the run-up to the Chinese New Year,
many in the industry forecast a challenging
time for businl.-'"Ss over the holiday period,
including ChowTai Fook jewellery Group
(CTF), the world's largest listed jewelry
chain. CTF reported a drop in sales during
the holiday period of29 percent, with sales
value down 30 percent on rhe MainJand
and 23 percent in H ong Kong and Macau.
It attributed the decline to the lower
numbers of visitors from the Mainland.
Tse Sui Luen j ewellery (International) Ltd.
(T SL) said they e},.l'ected Bat sales during
both the NewYear holidays and Valentine's
Day compared with the same period
in 2015, the HOlIg KOlIg Eeonomiejoumal
reported. T SL's chief strategy officer and
chief financial officer, Estella Ng Yi-kum,
said the city's retail prospects are likely to
remain tough for the next 12 to 18 months.
The Hong Kong R etail Management
Association (HKRMA) reported that most
of its member companies anticipated a
single-digit drop in sales over the holiday

52 Rapaport March 2016

period compared to the same time last year.

The tirning of Valentine's Day,fallingon the
first Sunday after Chinese New Year, was
not optimal for sales and Borists around the
city complained about missing out on the
office business. The Hong Kong Tourism
Board reported the number of vi'iitors from
Mainland China over the Lunar New Year
period dropped 12 percent and it predicts
that the overall number of tourists this year
will fall 3.2 percent compared to full year
2015 and that average spending will drop
4 percent per capita.
Darshan Patel, marketing director at
China Diamond Corp Ltd., noted the drop
in numbers oftourists from MainJand China
and the fact that those who came spent less.
"Both the retail and wholesale sides of the
business 'vere slow over Chinese NewYear;'
he said, ad ding that he didn't see the
market picking up in the next six months.
The "good omens"were not in evidence on
the stock market as the Hang Seng Index
slumped 3.9 percent at the dose after markets
reopened following a three-day trading
closure over the holiday. Retail jewelry
stores were impacted, with Chow Sang Sang
dropping.9 percent and Luk Fook Holding;
Ltd. declining 4.7 percent.

the fact that diamond prices have come

down and customers see the opportunity
to buy bigger stones." It's a wonderful time
for consumers to be buying diamonds," she
said, noting inventories were good so there
were no issues with sourcing large stones
and that prices were favorable .


In 2015, total retail sales in Hong Kong
declined in value for the second year
running. The drop of 3.7 percent was
the worst annual decline since 2002,
when sales fell 4.1 percent. Sales volume
fell .3 percent. Retail sales in D ecember
dropped by 8.5 percent in value, the
biggest percentage decline since january
2015. Sales volume fell by 6.1 compared
to the same period in 2014. T he greatest
decline in sales, yet again, was in the
jewelry, watches and clocb and valuable
gift~ category, which fell by 17 percent in
value and 10.8 percent in volume. T he
governm ent attributed the decline to
the continued slowdown in inbound
tourism and the uncertain economic
outlook. The Hong Kong dollar has also
strengthened against the yuan, making
the city a more expensive shopping
destination for MainJanders. +

Yet it's not all doom and gloom. Some
jewelers seem to be more resistant to the
challenging retail environment.These tend
to be niche operators who offera customized
service,such a~ Ryder Diamond~, a bespoke,
appoinmlent-only firm that specializes in
tailor-made wedding and engagement ring;
from design through production. "Most of
our clients come to us for an emotional
reason, such as to buy an engagement ring
or jewelry to celebrate another special
occasion,so our business ha.~n't been affected
so much by the economic climate," said
company founder, Sally Ryder, whose
clients are predominantly expatr iates in
Hong Kong and overseas. The wedding
market is still robust according to Ryder,
who is expanding her business. "We've
seen consistent growth. One trend I've
noticed is that we are selling larger and
more expensive stones," she added, which,
she said, might have something to do ,'lith

Bigger stones, 5 carats and above, are

in demand for custom-made jewelry.
White d iamonds are popular in all
shapes and colors.
Prices have fallen considerably, in
particularfor rounds, increasing
their popu larity.
Pointers up to 1 carat are popular
and companies are seeing opportunities
in introducing more lower-end items
to draw consumers.

Economic. Political Issues Impact Market


The International Diamond Week

that [Ook place in mid-February in
Ramat Gall saw some dealer trading, but

largely reflected the mood in the wider

market with concerns that consumer

demand remains sluggish. "T his edition of

International D iamond Wee k is taking
plac e during olle of th e most sensitive

periods the world diamond industry has

ever known," saidYor:Ull Dvash , president
of the Israel Diamond Exchange (IDE).
"The gap between rough and polish ed
prices still prevents liS from making a profit,
and eco nomic and political ch an ges
continue to impact our business."

Deal ers acknowledged that fewe r

exhibitors participated in this sixth edition

of Diamond Week than in previous years.

One Mumbai-hased buyer added that
there were also fewer goods available, and
that it was difficult to fmd the right good~
at the right price.
Shortag<.->s continued to define the market
and there we re ve ry few "ne,v" goods
available since manufacturing was at such
low levels during the second half of2015.
However, there is some anticipation that
new polished supply will start to become
available after rough trading increased
significantly in January.
In fact , most dealers who spoke with
Rapapo rt Maga z ine expressed conc ern
that polished demand did not support
the recent k",el of rough buying. Polished
trading is being driven by dealer demand
rather than an increase in consumer
demand for diamond j ew elry.
"We're keeping our expectations low
for this year given the state of the global
econ omy," said one Israeli dealer who
requested anonymity. "We don't feel that
we can make any long-term plan~ in such
a market."

R ecognizing the difficult market, the
IDE used the International Diamond
Week as a platform to announce new
opportunities for the trade. T he IDE signed
a memorandum of lUlderstanding (MOll)
with the Istanbul ChamberofJewelry (TKO),
with th e aim of increasing commercial

54 Rapaport March 2016

transactions b etween their resp ec tive

m e mb e rs. Th e parties had agreed to
cooperate in the organizations' respective
trade shows, to meet regularly to discuss
business opportunities and to facilitate
trade between the respective industries.
Eli Avidar, who ,vas recencly appointed
managing director of IDE , noted that
Turkey is a gateway to the N ear East and
many countries in the Russian Federation
have fast-growing economi es and an
e normous appetite for diamonds and
diamond jewelry. "Our cooperation can
lead to many business opportunities for
Israeli diamond dealers," he said.
The IDE also signed an MOU with
the Hong Kong Jewelry Manufacturers'
Association (HKJMA) aiming to forge
stronger ties be tween their respective
m e mb ers. Wings Cheu ng, general
manager of the association, explained that
the partnership made perfect sense since
Hong Kongj<.-'welers are looking to expand
their sourcing and consider Israel a good
market for responsibly sourced diamonds
- particularly with regard to monitoring
lab-grown diamonds, which is a growing
concern in Asia Pacific. C heung added that
Israeli prowess in technology was an area
that he felt Hong Kong j ewelers could
learn from and apply in their operations.
IDE also aimed to create oppornmities
in the local market by an nouncing the
creation of the Israel Diamond Jewelry
Association. In it~ statement of purpose,
the association acknowledged the role of
jewelers in expanding consumer desire
for diamonds.

The goal of raising consumer demand
came under the spotlight during an
Int erna t ional Diamond Week panel
dis c ussion on marke ting di amonds,
which featured Jea n- Marc Liebe rherr,
the newly appointed chief exec utive
officer (CEO) of the Diamond Producers
Association (DPA), Alex Popov, chairman
of the World Diamond Mark Foundation,
Patricia Syvrud, executive director of the
World Diamond Council (WD C), and
jewelry d<.-'Signer Stephen Webster.

Syvrud stressed that it is essential to

understand the vulnerabilities in the supply
chain in order to understand how to market
diamond~. From that basis, the WDC ailU~
to be a proactive voice sharing the good
that the diamond industry does, she added.
Lieberherr noted that one of the biggest
challenges acing the indu~try is transmitting
that positive message to Millenniah,many of
whom have never been exposed to diamond
marketing. The DPA recencly conducted
research among Millennials in the U.S. that
found they are looking to connect on an
emotionallcvel and that the industry n eed~
to COIWL'Y a diamond's special qualities and
emotional story.
For the Israel diamond industry, D vash
urged diamantaires to move closer to the
end consumer and understand their needs.
H e concluded that activity surrounding the
International DiamondWeek encompassed
much of that goal , particularly with the
MOUs that were signed and the Israel
Diamond Jewelry A~sociation initiative.
"W e need to shorten the distance
betw een diamond dealers and diamond
jewelry manufacturers," Dvash said. "We
have to fmd the optimum way to get us
closer to the end consumer." .

Steady U.S. demand; Asia Pacific slow.

Large delegation going to March
Hong Kong Show.
Good demand for good-quality SI-clarity
diamonds, triple EX with no fluorescence.
Stable demand for ' -carat, D-H, VS-SI,
trip le EX diamonds.
In fancy shapes, good demand for ovals,
pears and emeralds.
Fancy color diamonds stable with good
demand for rare blues and pinks.

Inventory Streamlines

The slump the market is witnessing is

a positive correction, with the demand
for rough showing signs of improvement
and the streamlining of polished inventory.

Spcakingexch<;ivclywith Rnpaport ~I!c,
Pravcenshankar Pandya, chairman,
Gem & Jewellery Export Promotion
Council (CJEPc), explaincd,"T hc month
of February was just right in terms of

demand and supply for rough. In fact,after

the self-discipline shown in the production
of polished, there has been a demand for
rough and the market is looking for rough
at the moment. Polished inventory is in
the process of being streamlined and the
industry is bearing the fruit of the decline
in manufacruring during the last quarter
of2015. This has brought about a balance

between the supply and demand for

polished. B ut yes, in certain segments, we
do see an excess, especially in better goods.
However, things are in control and we can
expect a positive 2016 for the industry.We
see manufacturers preparing for the year
ahead." Pandya aho noted that there is now
some shortage in pique goods.
Reiterating Pandya's point that the
industry is reaping the fruits of the lowered
production in the past four to five months,
Dinesh Navadia, pR"Sident, Surat Diamond
Association (SDA),summed up the current
market dynamics: " T he market is in a
positive phase currently. If manufacturers
restrain themselves the way they have done
for the past couple of month~, we are sure
that 2016 is going to be a good year for
the industry."
Navadia revealed that signing companies
up for the Surat diamond bourse was in full
swing and the bourse would be operational
in another two to three years. A~ part of
an ongoing initiarive,SDA will be holding
seminars to acquaint its members with
the rules and regulations of the Goods and
SenriceTax (GST), which is e}.-pectcd to be
implemented across tile country this year.


The announcement by the government
to require the implem emation of th e
Permane nt Accoum Number (PAN) of

56 Rapaport March 2016

any individual purchasing jewelry above

Rs. 2,00,000 - approximately $29,200 has not been well received by the industry.
To make the ir case to the government,
jewelers in Surat staged a one-day strike on
February 10. T he strike was supported by
the Surat Jewellers' Association (SJA), theAll
India Gems & Jewellery Trade Federation
(GJF) and the SDA. In fact, members of the
SDA showed solidarity with the striking
m e mbers by staying away from trading
in polished diamonds for the entire day.
Furthermore, given that the price of gold
is almost at $438 for 10 grams, the PAN
regulations will make an impact on the
industry, espec ially with the w eddi ng
season in India just around the corner.

I n a r ecent press statement, the
Gem & J ew e llery Skill Council of
India (GJ SCI), announced it had signed
a m e morandum of understanding
(MOV) with the Maharash tra State
Skill D evel opm e nt Society (MSSDS)
to explore a collaboration for increasing
employment potential in Maharashtra by
developing a supply of skilled manpower.
The MOV also states that MSSDS, along
with GJSC I, would undertake the training
of 12,000 young girls from remote areas
starting in the next two years. Furthermore,
additional training and improvement in
the working conditions of th e artisans
in the gem and jewelry sector will be
routed through GJSCLThis move is aimed
at strengthening the polishing industry a.~
well as the jewelry industry and expanding
the existing workforce.
In February, the GJEPC presented two
shows: the ninth edition of the Signature
India International Jewellery Show (I1JS)
and the third edi tion of India G em &
Jewellery Machinery Expo (IGJME). Both
shows m et with a renewed and positive
response this year, with visitors at IIJS aho
including many mom-and-pop jewelry
stores in Ind ia. IlJ S saw a 10 pe rce nt
increase in preregistration as compared to
2015; the number of overseas visitors rose
by 20 percent. Speaking at the inauguration
of " JS, Pandya shared that the council
plans to integrate the small and medium

enterprise (SME) manufacturers of gold

and diamonds under one roof in a stateof-the-art Jewellery Park in Mahara.~htra.

Th e ecommerce boom in India is
making players from rhe gem and jewelry
industry pay heed to th e changing
dynamics of shopping in India, which is
applicable to jewelry as well. D edicated
portals like Jewel Hu b, Carat Lane,
Blu e Stone, among other s, are luring
custome rs with offers and discounts on
diamond jewelry. R ecently, one of the
o ldest names in j ewelry, Tribhovandas
Bhimji Zaveri (TBZ), also join ed the
bandwagon w ith an online presence. T he
jewelry is currently selling through two
portaL~ , Snapdeal and Flipkart.
At the Hong Kong International Jewellery
Show this month , Kapu Gems launched
a new w ebsite and mobile application.
Bt"Sides facilitating the buying of certified
diamond~, tile high-definition video feature
will enable buyers to have an accurate view
of the items they would want to purchase.
According to the company spokesperson,
" A new thoroughly detailed matched pair
section will address the retailers' universal
challenge of making the right matche d
pair of diamonds."

Market continues to be positive but

slow in terms of activities.
Shortages in supply are driving
polished goods prices on the upper side
in a few categories.
Rough prices are stabilizing.
Manufacturing activity has improved
compared to previous months.
Weakening of rupee against the u .s. dollar
has affected the domestic market.

Visit us ot:

Hong Kong International

Diamond, Gem & Pearl Show

1st - 5th March 2016
Boolh No:

AWE 2-K02

-I r

a n




A U IOs\





~_M _ _ _ _

ALROSA's 2015 Production Up, Sales Down


In 2015,ALROSA produced a total

of 38.3 million carats of rough,
representing a 6 percent year-on-year
increase. The gain was driven by the
growing production rates at rhe Mit and
Udachny underground mines and the
recently commissioned Botuobinskaya
open- pit mine inYakuria and Karpin4:0g0-1
open-pit mine in Arkhangchk. The latter
mine repr<'-"liCms the company's Scvcralmaz
division, th e mining giant's designated
driving forc e of its long-term strategic
development plan through 2023.
ALRO$A estimated its 20t 5 preliminary
sales volume at 30 million carat~, which
is $10 million less than the company was
hoping it would be able to sell back at the
beginning of the year, as well as $ 10 million
less than it actually sold in 2014. R evenue
from rough in 2015 is expected to reach at
least $3.4 billion.
In the fourth quarter of 2015, ALROSA
sold a total of 7.1 million carats, which is
30 percent more than in the third quarter.
The company sold almost twice as much
of industrial-grade diamonds quarter on
quarter - a total of 3 million carats at an
average price of$1 0 per carat. It abo traded
4.1 million carats of gem-quality diamonds
at an average price of $166 per carat,
e ffectively red ucing the price by almost
9 percent compared to the pno'Viou~ quarter,
which al~o saw an 8 percent price reduction.
During a visit by ALROSA's management
to Mumbai and Surat, India , in February,
company President Andrey Zharkov told a
local no'Vorter from Bloomberg that he saw
no indications in the market for furth er
adjusDnent of rough prices. He al~o shared
his expectation that demand for polished
might grow by 1 percent to 2 percent in
2016, helping stabilize the overall situation
in the pipeline.


In February,jUNWEX St. Petersburg,
Russia's largest aIUlUaljewelry exhibition,
took place under challenging conditions.
According to Eduard Utlcin,chiefexecutive
officer (CEO) of the Rmslan jewelers Guild
Association, overall demand for jewelry

58 Rapaport March 2016

in the country has shrunk by 50 percent,

while jewe lry retail prices have gone up by
80 percent,and sometlllK"S (o'VCn 100 percent,
following the dramatic d evaluation of
the ruble. "A crisis usually triggers a shift
in consumer demand toward the cheaper
products on the market and that's what we
see happening. Customers are now more
actively shopping for silver than gold, and
for cheaper natural stones or even synthetic
ones," Utkin said. Many retailers agreed
that demand for silver j ewelry has increased
by 30 pe rcent to 35 percent, and many
of those previously specializing in gold
jewelry have responded by introducing
silver collections into their product range.


However, Kristall Smolensk's jewelry
division, Smol ensk Diamonds, reported
better sales results in St. Petersburg than
in 2015 and even 2014. "The number of
companies offering expensive high- quality
diamond jewelry has dwindled," explained
Vyacheslav Rayevsky, founder ofSmolensk
Diamonds and head ofproduction at Kristall
SmoleIL~."Many have no'Vlsed their product
lines to offer cheaper merchandi~e, leaving
very few vendors in the luxury segment,
because staying in it is quite expensive; it
requires considerable in'll.-"Stments in stock.
This seems to have created the situation
where those customers who would still like
to shop for top-quality diamond jewelry in
our country don 't have many sellers who
m eet their n eed~ ," he continued.According
to Rayevsky, diamond j ewelry shoppers
at jUNWEX Sf. Petersburg looke d at
products priced $4,(}{)() and up, bur showed
little interest in items in the more affordable
price range starting with a $1 ,300 price tag.
Premier, a recent survey conducted by
Synovatc Comcon, the Russia-based group
of the international research network Ipsos,
has abo confirmed this trend. It reported
that the share of high- income customers
shopping for upper- price-range jewelry
has increased from 40 percent in 2013
to 43 percen t in 2015. The company's
projection is that this number is likely to
stay unchanged for a while.

Eug e niy Kustov, directo r of the

Kostroma- based Kustov jewelry company,
point ed out that while previously
customers shopped in equal proportions
for jewelry with diamonds and colored
gems, today they have a strong preference
for diamonds. " In the diamond j ewelry
mix, the demand is higher for designs with
a prominent centerpiece. not pave designs,
which were quite popular two and three
years ago," he added.
Still, despite some successes, the overall
market situation remains arduous and
calls for more hard work than optimism,
believes V iktor Tulupov, director of the
Ye katerinburg-based Tulupov Jewelry
House. " In mbk-s,oursales were better than
in 2015, but that converts to a lot less in
dollars The gem~ we need for our products
are traded in dollars. However, consumers
are not ready to pay the double price for
jewelry, so we are forc ed to keep the prices
as low as we can by cUHing down on the
margin. OfcollI'Se you can't call the situation
very happy, but that's how work is, and we
are committed to it;' he concluded. +

Thomson Reuters GFMS Gold Survey

reported that consumer demand for gold
jewelry in Russia in 2015 was 46.5 tons, a
34 percent decrease overthe previous year.
In the fourth quarter 201 S, Russia's
demand for gold jewelry went down by
32.4 percent, totaling 12.5 tons, which
corresponds to a 2 percent share of the
global gold jewelry demand of 584 tons
registered in the last three months of 2015.
Russian Assay Chamber reported that
only 34.22 tons of gold was used in the
country for producing jewelry in 2015,
reflect ing a 39.8 yearonyear decrease.

View ollr current collection & contact liS at:


+ 1 855 RA I'AKA'I

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ES7". 1955

Business Mixed at Antwerp Fair


The Antwerp Diamond Trade Fair

(ADTF) that took place January 31
through February 2 w as the seventh

even more than we anticipated. If S percent

o f the contacts made are followed by
orders, then it'll be one ofour best shows."

edition, proving that the fair is now part of

the global picture and is likely to he a

permanent fLXtllrc T his is a good po int for
Antwerp, where diamantaiR'S can now rely

on an additional, well-established tool to

display both their know-how and good~ at
a reasonably fair price, since it's quite easy
to move diamonds from a vault in the
Diamond Square Mile to a booth at the
show. Having said that, the seventh edition

is also the occasion to take a look at the

positive and negative aspects of the show.

On the upside. all visitors and buyers
concurred that coming to Antwerp
for this show is an opportunity to meet

people and to come as close as possible

to the source. For buyers, it's the dream
that they will be able to fmd anything they
want in Annverp. And it's true. Of course
there's always the issue of agreeing on a
price, but where there's a will, in Annverp,
there's always a way. Mohamed A. Bazzy,
of Belgium-based Pristine Diamonds,
elaborated, "We w ill only know the
outcome of the show afterwards, in the
follow-up step. H owever in terms of
show expenses, convenience and safety,
it is very acceptable if you compare it to
any other international show." Akashi Jain,
of KG K D iamond BVllA, added, "The
fair was quite decent. We can't say it's
booming, but it's okay as far as contacts
are concerned. It's all about PR , with an
eye toward the European market. We did
make some sales . In the bigger range, in
particular, we sold one S. lS-carat round,
H ,VSl triple EX. In total, we sold four
stones in the 3-carat to 5.5-carat range
and one 9-carat fancy light yellow VS.
N o need to say that the stones were
more than worth the investment for us."
Yoeri Sand, of Sand Gems, noted, "We
didn't bring diamonds here because we
wanted to differentiate ourselves from the
others. Many people were surprised when
they discovered our displays of rubies,
sapphires and emeralds, and they bought

60 Rapaport March 2016

On the flip side of the coin, it turned
out that the exhibitors were globally
still displeased by the poor quality of the
visitors and buyers. Bazzy noted," A lot of
the buyers appeared to be active in the
semiprecious business . Those who are
here to really do business in diamonds
can be counted on the fingers of one
hand." A major diamond manufacturer
and exhibitor, who preferred to remain
anonymous, explained, "T he show was
okay, but the quality of the buyers should
be drastically improved. Small jewelers
came here who were not at all interested
in buying diamonds. T hey just came
and enj oyed a three- day holiday tour
of B elgium offered by us. Such buyers
are not effective enough for susta ining
our diamond company. Therefore, while
we had a full booth over the past three
shows, thi~ time we decided to share one.
I don't know w hether we'll come next
year, and many of my colleagues are facing
the same question . Not to mention that
during the whole of day one, workers were
completing several technical aspects of
the booth~' hardware, drilling and sawing
all day long."
Eitan R epin,ofOnyx DiamondsEurope,
agreed: " T he show was too expensive
for the poor qu ality of the buyers."
Tony H addad of Paris-based Diamprest
also concur red, noting, "Most peop le
were not here to buy. T hey were tourists,
so we had to sort through them to identify
the buyers." T he cherry on the cake was
undoubtedly the comment of a diamond
manufacturer, who explained off the
record that one of the visitors didn't even
know how to hold his loupe.
Looking for ways to improve the
situation, Bazzy suggested, " I strongly
believe we can have a much better show
here if we manage to move the whole
Basel diamond pavilion here to Antwerp.
But it'll have to be done by people who
are much more rooted in the trade and

organized." Jain added, "As fa r as buyers

are concerned, \ve're not always meeting
with good ones. H owever, it's a good way
for lIS to discover the needs of buyers from
markets we're not active in yet and learn."
One wonders whether the situation is
any different at the other European shows.
" T here are still tourist.~ among the buyers,
but definitely less than at Inhorgenta or
Vicenza. To such an extent that even
without follow up, we most cert ainly
broke even," insisted Sand. Conclu ded
H addad: "We were happy to have some
clients coming from D enmark, Spain,
France, Italy and from all over Europe.This
is the strong point of the show, even though
big retail groups weren't present this year.
I think, and many agree with me, the fi rst
thing to do is to stop paying the hoteL~ for
them. T his is where tourism ends and
where business begins." +

Po lished :
20-poin t ers t o 1. S-carat roun ds in
com mercia l goods - D-H, VS-SI - are
going up in price by 3 percent to
S perce nt d ue t o sho rtages in productio n
over t he past six months.
Difficult t o move 3D-pointers and
40-pointers, VS, SI, H and up.
. 2- caraters t o 3-carate rs are the w eakest
part of t he larg er-size segment.
Shortages seen for f ancy shape s: princess
cuts fro m 5 po ints t o 70 points, W S-SI
and emerald sha pes from 1S poin ts to
70 points.
Ro ug h prices are hot again: 10 percent
to 15 percent an d up, across t he board
fro m t he chea pest to t he m ost expensive
big st on es.


Guide to the RapNet Asking Price List

What is RapNet?
RapNet is the Rapaport Diamond Trading Network available exclusively to members of the diamond and
jewelry trade. With listings of over 1 million diamonds valued at more than $6.75 billion and over 14,000
paid members in 84 countries, RapNet is the largest and most important diamond trading network in the
world. Buyers and sellers deal directly w ith each other without any commission or trading fees . RapNet
membership includes an online subscription to the Rapaport Price List and starts at $660 per year.
What is the RapNet Asking Price List?
The Rap Net Asking Price List provides a snapshot of best and average asking prices for specific
diamonds offered for sale on the RapNet Trading Network. The prices are presented in US $ per carat and
percentages below or above the standard Rapaport Price List. The RapNet Price List is based on GIA
graded Excellent and Very Good Cut diamonds. Additional online price and trading information is
available 24fi , real-time, for a wide range of diamond qualities.
How is the RapNet Asking Price List Different than the Rapaport Price List?
The Rapaport Price List, published for over 30 years, presents Martin Rapaport's opinion of High Cash
Asking Prices that are used by the global diamond trade as a starting point for negotiations and a basis
for estimating the value for a broad range of diamond sizes and qualities. The RapNet Asking Price List
presents actual asking prices by sellers for specific diamonds. Rap Net Asking Prices are not based on
opinion and may fluctuate on a minute by m inute basis. RapNet Prices are available to members online in
real time via Rapaport TradeScreens~ A primary benefit of the RapNet Asking Price List is that it discloses
detailed information about d iscounts and premiums to the standard Rapaport Price List.
How to Read the RapNet Asking Price List?

RapNet Best/Average Asking Prices

14.575/ 20.839

US $14,575 is the Best RapNet asking price available

for a Round, D, IF 1.00 - 1.49ct diamond .
-47% is the Best Rap Net asking price available
expressed in terms of discount to the Rapaport Price List.
US $20,839 is the RapNet average asking price for the diamond.
-24 % is the RapNet average price expressed in terms of discount
to the Rapaport Price List.

For more information or to join RapNet go to www.rapnet.com. email info@rapnet.com

or call +1 -702-893-9400 in the USA.

u.s. Imports Slide

u.s. polished diamond imports for 2015 lowered 4 percent year on year to $23.1 billion. Po lished diamond

imports for December declined 12.7 percent to $1.63 billion.By voltune, poli~hed diamond imports for 2015
and December fellS percent and 3 percent to 11.1 million carats and 793,776 carats respectively.
Polished diamond exports for 2015 and December dipped 12 percent and 9 percent to
$18.32 billion and $1.26 billion respectively. By volume, polished diamond exports
for 2015 and December lost 14 percent and 9 percent to 11.9 million carats and
763,015 carats respectively.
Rough diamond imports plununeted 44.2 percent to $306 million for 2015, but Iincreased 26 percent to $29 million for December. By volum e for 2015 and
December, polished diamond import~ grew 1.2 percentto 434,645 carats and
89.2 percent to 42,567 percent respectively.
Rough diamond exports for 2015 and December dropped 47.5 percent to
$192 million and 4.8 percent to $20 million respectively. By volume, rough
diamond exports spiraled 56 percent to 264,512 carats and 71.5 percent to
16,098 carat~ respectively.

India's Exports Plunge

India's polished diamond exports dwindled 42 percent year on year to $1 .04 billion
in January 2016, or 36 percent by volume to 1.8 million carats. Po lished diamond imports shrank
47 percent to $197.3 million, or 41.2 percent by volume to 350,000 carats .
Rough diamond imports in January jumped 16.3 percent year on year to $990.6 million, or
39.6 percent to 12.3 million carats by volume.
R ough diamond exports inJanuary crept up .7 percent year on year to $107.2 million , even though
by volume it fell 21.9 percent to 2.4 million carats .

Belgium's Exports Down

Belgium's polished diam ond export~ in January 2016 retreated 4.5 percent year on year to $772 million, or
8 percent by volume to 397,945 carats. Polished diamond imports dived 11 .5 percent year on year to $985 million,
or 12.8 percent to 542,159 carats by volume .
R ough diamond imports in January decreased 13 percent year on year to $730.4 million, or 16 percent by volume
to 5.7 million carats .
R ough diamond exports inJanuary slumped 6.7 percent year on year to $791.9 million , but by volume grew
30.3 percent to 8.8 million carats.

Rough Imports






Polished Imports



' 3000





' 4000








20 15

___ I"ael ___ India ___ Belgium

' 2000



, '000

Feb Mar Apr May June July Aug Sep Ocl Nov Dec


___ U.S.

92 Rapaport March 2016


Rio Tinto's Sales Fall

Rio Tinto's diamond revenue for 2015 declined 23.5 percent year on year to $698 million and earnings before
interest and tax (EB IT) slipped 7 percent to $293 million. The decrease was attributed to weaker rough diamond
prices, driven by lower demand from India and China, higher rough and polished diamond inventory and lower
trade manufacturing margins .
Diamond production grew 25 percent to 17.4 million carats.
Rio Tinto's output guidance for 2016 increased 21 percent to 21 million carat"_
~~S~~s::;;~ The mining company's new A21 kimberlite pipe at the Diavik mine in Canada is progressing as planned.
fProduction is expected to start in 2018.

Dominion Sales Shrink

Dominion Diamond Corporation's sales contracted 26 percent to $178.1 million
in the fourth quarter that ended January 31,2015. Sales diminished 21.3 percent to
$720.6 million for full year 2015. US. diamond retail sales were positive during the
quarter, but overstocking in China - even though consumers continued to buy
jewelry - m eant lower replenishment of inventory.
The Ekati mine produced 42 percent m ore diamonds year on year at 1.2 million
carats in the fourth quarter.
-Th e first ore at the Misery Main pipe at Ekati has b een mined, and Dominion
expects to complete the feasibility study of the Jay pipe, also at Ekati, by May
2016 - one month later than previously expected.


Lucara's Revenue Dips

Lucara Diamond Corp. reported revenue receding 7.5 percent year on year to
$65.2 million in the fourth quarterthat ended December 31, 2015 and 15.7 percent
to $223.8 million for the full year.The fall in revenue was attributed to a weakening diamond market.
Despite the fall in revenue, Lucara achieved a n et income of$19 million for the quarter - the company had a
net loss of.$16 .8 million in the fourth quarter 2014 .
Net income for the year skyrocketed 70.2 percent year on year to .$77 .8 million .

Petra Swings to a Loss

Petra Diamonds Ltd. saw revenu e tumbling 28 percent
year on year to .$154 million for the first half that ended
December 31,2015. Excluding the sale of exceptional
diamonds, revenue was down 18 percent to $144 million.
The mining company swung to a loss of$2.2 million,
compared to a profit of$39.1 million year on year.
Petra attributed the loss to a weaker diamond market
and unrealized foreign exchange losses.
Production increased 2 percent to 1.6 million carats
during the first half.

Polished Exports






Feb Mar Apr Moy Jun


Aug Sep Oct Nav o..c Jon



__ U.S.

__ Belgium __ Ind ia

Precious Metals



















863 .00




861 .00



















11 90.00



2111 /16























15. 2500


123 1.15

941 .00






Rapaport March 2016 93

Nature's Miracles, Our Expertise

23.16 carat Rare Pink - The W illiamson Pink



M.A. Ana\li Diamond Group.

Yaha lom Bldg. Suite 2962. 21 Tuval St. Ramat-Gan 5252 1 Israel, Tel: 972-3-7 522111, 613 1277, Fax: 972-3-6131276
Email : meir@anavi.com.robert kmarks@gma il .com

Tel-Aviv I Antwerp I Johannesburg I Mumbai

of events
MARCH 2016


JEWELRY INDUSTRY SUMMIT. NEW YORK. jewelryindustrysummit.com
ISTANBUL JEWELRY SHOW, TURKEY, istanbuljewelryshow.com
JA NEW YORK SPRING SHOW, ja-newyork.com
POLAND SHOW - AMBERIF. GDANSK, amberif.amberexpo.pl
BASELWORLD 2016, SWITZERLAND, baselworld.com

APRIL 2016


AGS INTERNATIONAL CONCLAVE, ARLINGTON, VIRGINIA. americangemsociety.orglconclave2016
VICENZAORO DUBAI, UAE, vicenzaorodubai.com
JEWELLERY ARABIA, KUWAIT, jewelleryarabia .com.kw

MAY 2016





JCK LUXURY. LAS VEGAS, luxuryjckonline.com



at 11 :OOa m, EST

Over 300 Pieces

of Estate Jewelry

Preview Dates
Tuesday March 1st & Wednesday, 2nd
Waldorf Astoria, 301 Park Avenue, NY
4th Floor, Herbert Hoover Room

, lam to Spm
Additional New York Preview Dates
Tuesday, March 8th & Wednesday, March 9th
By Appointment Only
For an appointment call: 212-740-7600
Illustrated Catalog Available Online

580 Fifth Avenue, New York, NY 10036

212-819- 1899

I 313 -884-4800 I 800-47S-GEMS (4367)


For more information regarding preview, bidding

and the auction please visit josephdumouchelle.com




Platinum, Rubyand Diamond L~dy' Necklace and Earring<. Set with 35 unh,m,d Burmese
rubies totaling approx. 42.55a. ALm set with 426 di~mond. towling ~pprox. 26.06a.
lmport~nt 54 .59a N~rur~1 U"he~ted C,ylon S~pphi'" ~nd Di~mond
L~dy:' Nuklace with over 100 c~r~ts of diamond, ~"d AGUGubelin Report
Ruby ~nd Di~mond L~dy' Ring. Ce"rr~1 'me .... 1d cut ruby ~t ~pprox. 1O.36ct., unh'M,d Burmese
19.14c/ He~rt 5h~p, Di~mond L~dy' Ring. GlA report, VSI Po/ential, K Color
7.06c/ Emer~1d Cut Di~mond L~dy' Ring. GIA report, F Color, S1114kt Y,lIow Gold ~nd
7./5a S~pphire ~nd Di~mond L~dys Ring, Centrol S~pphi'" ~ / ~pprox. 27.00ct

Stephen lussier, CEO of Forevermark, has been made

replaces J ean-Ma rc Lieberherr, who was rece ntly
managing director of R io T into's diam o nd division.
Lussier, who is also executive vice president of marketing
at De Beers, moved up from his role as vice chairman of
the DPA . Ji m Pou nds, executive vice president at
Do m inion Diamo nd Corporation, will m ove toto
Lussier's previous position.

chairman of the Diamond Producers Association {DPA}.

New York-based jewelry house Misahara appointed

In addition to her new role,

Winter is also th e COO of skincare product company
37 Actives and the CEO and fo under of consultancies
Luxury Brand Consulting, Inc. and Janice Winter Inc.
Janice Winter as its new CEO.

Joanne Milner has been made U.K.-based jewelry house

Milner was previously C E O at

Bri tish luxury brand Debrett. She previously worked
in private equity.
Garrard's new CEO.

Shmuel Schnitzer has been elected chairman of the

Israel Diamond Institute Group of Companies {lDI}.

Schnitzer, who completed his fourth term as president

of th e Israel Diamond Exc h ange (IDE), succeeds
Moti Ganz.

as relationship executive to expand the company's program.

Saltma rsh was forme rly executive vice president at

management consulting firm T he Cornell Group.

The Diamond Empowerment Fund {D.E.F.} announced

six new board members and its new executive committee

Some of the committee officers are returning

to their positions.
Phyllis Bergman, CEO, Mercury lUng, president
Ed H rabak, CEO, Signet Jewelers, vice president
Ya tlcy Weinrich, senior vice president,J CK, secretary
Riclt Slomovitz, C FO,Rush Conullunications, treasurer

for 2016.

Board members are:

Kathy Corey, owner, Day's Jewelers
Betlt Gerstein, cofounder and co-CEO, Brilliant Earth
Eddie Le Vian, CEO, Le Vian Corp.
Russell Mehta, managing director, R osy Blue
M ichael Pollak, president, Hyde Park Jewelers
SlIsan H anna- Wicht, advisor, Global Language Project
Outgoing board members became members of
the D.E.F. advisory board:
Cathy Calhoun, M eir Dalumi, Dylan Dix, Ellen H addigatl,
Jeall Palll Tolkowsky and J ad WilSOlI-Reid

98 Rapaport March 2016

Jewelry insurance provider unBLOCKed hired Don Saltmarsh

Ruth Batson will step down as CEO of the American Gem

Barson has been with

AGS for 23 years . H er departure is scheduled for the
sunUller of2017.T he AGS board of directors will form
a conullittee to hire a new C EO.
In other AGS news, the orga nizatio n will honor
Dione Kenyon, Stewart Wicht and Hank Siegel at its
annual C ircle of Distinction dinner on July 26,2016 in
New York City. Kenyon, president of the Jewelers Board
ofTrade GBT) will receive the Lifetime Achievement
Awarcl;Wicht, CEO and president ofRolex Watch U.S.A.,
and Siegel, president of H amilton Jewelers, will receive
theAGSTriple Zero Award .

Society {AGS} and AGS laboratories.


Centre {DMCC} and chairman of the Kimberley Process {KP},

was granted honorary membership by the World Jewelry Hub

E li Izhakoff, chairman of WJ H,
presented the membership when bin Sulayem visited the
country as a guest of the trading center in Panama.
{WJH} in Panama City.

Bin Sulayem m et with the lead ets hip of the Panama

Diam o n d Exch ange (P DE) to d iscuss increas ing
cooperation between the WJH and the DMCC.
Centurion Jewelry announced the winners of the 2016
Vendors' Choice Retailers Awards and Centurion Design
Awards at the Centurion Scottsdale Show in Arizona. For
the Vendors' C hoice R etailer Awards, the winners are:
M ost Co mmuttity Engaged R etailer: Ti vo l In c.,
Kansas C ity, Missouri
M ost Savvy Buyer: Be On Park,Winter Park, Florida
Best M erchandise Presen tation: Co rn ell 's J ewelers,
Rochester, N ew York
BestD(gital PresetUe:ComelYsJewelers, Rochester,NewYork
M ost Outstanding R etail Partner iftheYear:Montelon go's
FineJewelry, College Station,Texas; ShelterWadeJewelers,
San Antonio, Texas; rivo/ Inc., Kansas C ity, Missouri
Fo r the C enturion D esign Awards, the winners are:
Bridal: C h ristopher D esigns
Colored Stone Classic:JB Star
Colored Stotle Fashion: Spark C reations
D iamond Classic: Etho Maria
D iamond Fashion:Siera Jewelry
Gold: Narus
Mixed Predous M etals: Armenta
Pearl: Mizuki
Platinum: Gumuchian
Sterling S ilver: Syna
f..%tches: Michele
Best Showcase D es,gn: Tara Pearls
The Women's Jewelry Association (WJA) named its
Hall of Fame honorees for its annual Awards for Excellence gala
on July 25, 2016 in New York City. The honorees are:
Lifetim e A chievement Award: Sissy J o nes, owner of
Sissy's Log Cabin
Ben Kaiser L ifetime A ch iwemel1t A ward : Peter Engel,
president of Fred M eyer Jewelers
Corporate Award: B en Bridge Jeweler
AlROSA recovered a 121.96-carat diamond from its Jubilee
kimberlite pipe in February. The diamond was extracted by
Aikhal Mining and Processing Division (MPD). T he diamond
is transparent with a moderate yellowish hue and contains
small olivine, graphite and sulphide inclusions.
lucapa Diamond Company announced it has recovered
what it claims to be the largest stone ever found in Angola .
The 404.2-carat sto ne is a type Ila, D -color diam ond,
and it was recovered from alluvial mining at Lu capa 's
Lulo Diamond Proj ect.The gem is the fourth diamond
over 100 carats to be recovered from Lulo since it began
productio n, according to Lucapa .

lucara Diamond Corp. will hold its first exceptional stone

tender of 2016, April 4 to 13, in Gaborone, Botswana. Th e
tender "vill feature ten diamonds with a combined weight of
1,525 carats, including a 296-carat type Ila rough stone.The
tender will not include the 1, 111-carat diamond recovered
from the Karowe mine in Botswana in November 2015.
The Gemological Institute of America (GIA) is offering over
125 scholarships totaling more than 5500,000 to prospective
students for its Gemology and Jewelry Manufacturing Arts
program.The awards, ranging from $500 to $22,000 each,
will be available for courses at the instintte's campuses in
Bangkok, Carlsbad, Dubai,Hong Kong, London , Mumbai,
New York and Taiwan. The application perio d will run
through April 30, 2016.
The Mediterranean Gemmological and Jewellery (MGJ)
Conference scheduled for May 7 to 9, 2016 in Valencia, Spain,
will focus on diamond treatments. The event is jointly
organized by Ca nadian gem laborator y CGL-GRS,
Greek laboratory IGL, Spanish labo ratory MLLOP IS
and the U.S. National Association ofJewelry Appraisers
(NAJA). Gaetano C avali er i, president ofC IBJ O, the
World Jeweller y C onfederation , will inaugu rate the
co nference. Speakers include:
David Fisher, D e Beers Technologies
Dusan S imic, Analytical Gemology & Jewelry (AG&J)
Sonny Pope, Suncrest Diamonds
MikkoAstroll1, M&AGemological Instrwnents (MAGI)
The American Gem Trade Association (AGTA) amended
its Code of Ethics and Principles of Fair Business to
include recommended source disclosure language.
The am endmen ts are:
E ach AGTA member should exercise due diligence
w hen dealing with gemstones and jewelry, including
disclosure of any known treatments and enhancem ents.
Questionable material should be submitted to a reputable
laboratory for analysi~ to be contained in a written report.
M embers should deter mine that gems they source and
sell are responsibly and ethically mined and are not in
violation of any international laws.
The u.S . Fish & Wildlife Service (USFWS) will be accepting
donations of legally-owned ivory products at its National
Wildlife Repository at th e Office of law Enforcement in
Commerce City, Colorado. The service was launched to
reduce the overall ivory market by allowing a space for
ivory owners to safely and legally dispose of the produ ct~ .
Th e USFWS will accept do nations of legally-owned
ivory products including antiques ~ which can be sold with
some restrictions and nonantiques ~ currently prohibited
from conunercial trade by state and federal law. ..
Rapaport March 2016 99





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Emphasizing the personal touch is a top priority at

McCaskill & Company in Destin, Florida.
e want peopl e to feel as if th ey
are wa lking in t o our ho m e," says
William (Bill) Campbell, explaining how
the " personal tou ch " is very mu ch a part of
McCaskill & Company, which he owns along with
his wife Elizabeth. The D estin, Florida , store offers up
designer diamond and gemstone jewelry and watches - as
well as freshly baked chocolate chip cookies.
Bill's interest in jewelry began with a very personal
story_ As a child, he would play with the gems owned
by his grandmother, Gussie McCaskill Campbell. "My
great-grandfather traveled the world and he would
always bring back an amazing variety of stones for his
wife and children;' he explains. Although intrigued by
their colors and shapes, Bill did not pursue jewelry as a
career, but entered the family building-supply business
insteadYet the fascination with gemstones always stayed
with him. He recalls that when he and Elizabeth would
go on vacation , jewelry stores were always on their
must-see agenda . However, it wasn't until he sold the
family business that Bill began thinking seriously about
his "early love" and started taking classes in gemology.
Starting out near D estin , Bill 's first venture began
106 Rapaport March2016

in 1993, selling j ewelry door-to-door out of the trunk

of his car from what Elizabeth recalls as a "tiny, tiny
sttitcase:'A year later, in neighboring Seaside, he sold out of
a kiosk - the "size ofa doll's house." One year after that, he
relocated to the Sandestin Market Place, a shopping center.
It was a one-person operation, but as th e business grew,
Elizabeth , a mental health professional, gradually became
more involved, until it too became her second career.
"We have a really good partnership. Bill loves to sell,
while I am more detail oriented," she says, describing their
compl ementary skill sets. In 1999, the couple open ed
McC askill & Company, a free standing store, named in
honor of hi~ grandmother. Strengthening the family bond,
Bill and Elizabeth's daughter, Carolyn Brigm.an,joined the
business seven years ago and now serves as vice president.
Destin is lo cat ed on the Fl orida Panhandle in the
northwestern part of the state, an area often referred to
as the Emerald Coast for its natural beauty. Many o f its
residents are people from other parts of the country who
own second homes th ere. "We are a high-end resort.
Our customers are well traveled They can buy anywhere
but they com e here, looking for so mething uniqu e,"
Elizabeth points out.

Erica Courtney

"We specialize in many one-of-a-kind
pieces," notes Bill, who has three top criteria for
selecting designers. " I really have to be inspired by the
design, excited about the way the piece is made and it has
to be exclusive to us." In addition to having long-standing
perso nal relationships with the design ers, Bill credits
them as his mentors when he was starting out, especially
H enry Dunay. "They guided me and helped me along
the way from the beginning.You get spoiled when you
have the best of th e b est." Top-selling designers include
Erica Courrney, Kwiat, Alex Sepkus, Pamela Froman and
Paul Morelli.
"We love color," says Bill, citing garnet, rubellite and
tourmaline as customer favorites, adding that opals in
designer pieces do very well in the store."We're definitely
a ring sto re," says Elizabeth, followed by earrings and
bracelets. However, the ring categor y is disrinct from
their bridal business, which she describes as "building."
Bridal best sellers are Simon G. and H enri Daussi, with
the average srone size ranging between 1 carat and 2 carats.
With its cream-colored walls, picture windows and
designared sitting areas with couches and armchairs , the
store reflects Bill and Elizabeth's desire to create a warm
and welcomingenvironment."People spend hours in the
store - even lithey do not buy anything," says Bill, who
notes they are welcome to read a paper, enjoy cookies
and coffee or later in the day sip wine and Champagne.

Custom-designed birch ped est als topped

with glass display cases are set in the middle of the
2,OOO-square-foot main showroom.These units, higher
than standard cases, make it easy for customers to view
th e jewelry, which is m erc handised by d esign er to
create a "sign ifica nt presence," according to Bill.
Another 1,100 squ are feet is dedicated to a separate
bridal area.The decor is in the same color scheme, but the
cases are draped in velveteen cloth to resemble the gentle
flow of a bridal gown. "We wanted to give a co upl e
more privacy as they make this ver y personal selection,"
explains Elizabeth.
Even their promotional activity is geared to personal
invo lvement, wi th interactive demonstrations. Bill
and Elizabeth introdu ced a diamond-cutting event,
complete with a cutting wheel ."People actually got to
put their hands on the wheel," says Elizabeth about this
"hugely successful " eve nt. A gem roundtable hosted
b y Erica Co urtn ey was anoth er extrem ely popular
promotion. Standing next to a tabl e of loose stones,
th e designer shared the gems' st ories with a captivat ed
audi ence who were introdu ce d t o ston es th ey had
neve r see n or hea rd of before. Eli zabe th draws a
distinction between this even t and a designer trunk
show, noting, "It is another way to emph asize our
perso nal approach."
"Our customers come back year after year," Bill points
out, crediting his stafffor building long-term relationships .
" It is all about attention to detail;' says Eljzabeth .
Rapaport March 2016 101





he 4Cs are not the o nly things that make a piece

of diamond j ewelry a sales winner. In an ongoing
series, Rapaport Magaz;"e explores the " 3Ws" ~
what's selling, what's not and why ~ by goin g

straight to the people who really kn ow ~ jewelry

retailers . Each month, we ask a sampling of retailers to
conunent on th e important issues that are facing the
industry today. H ere is what they had to say when asked:
"WI,al are you restocking after Christmas? What were
the key items that sold that need to befilled in?"
"We're always having to restock loose diamonds
because 51 percent of our business is engagement rings .

Round is king right now; we're seeing very little else

being requested at this time.We try to make sure we have
a full inventory of round in all sizes up to 3 carats.We are
educators and we like to sit down and go over the value
of the piece as mu ch as we like to go over what makes
a piece ofjewelry tick. In other words, we'll look under
the microscope and we'll show them the cut under the
scope.We'll compare the stone against our master set of
nantral color diamonds so that they can see for themselves
what has real value. We sell diam onds with a better cut
faster than we do color and clarity.
"When it comes to fashion pi eces, we sold a
$50,000 ruby and diamond bracelet around Christmas
108 Rapaport March2016



time, but we probably won't replace that one right away.
And we sold a $20,000 ruby and diamond fashion ring
in January, but I also don't plan to replace it right away.
Christmas wasn't as strong as normal, so we still have
a fairly strong inventory. We're just replacing what we
know are th e bread-and-bu tter fast-sellers, like th e
fast-sellers from John H ardy and Konstantino. Diamond
stud earrings, smaller stuff, was mostly what we sold at
C hristmas, so we're refilling all ofthat .We're not getting
to the bigger-ticket items just yet."
For us, it has been our Rhythm of Love diamond
pendants and earrings, but it's been all over the board,
with price ranges from $500 to about $2,000. We did
really well with a company called Allison-Kaufinan and
we sold a broad range, a bit of everythin g, from their
colored fashion jewelry ~ colored stones,such as rubies,
sapphires, and colored diamonds as well. In bridal, halos
did very well."
"Diamonds are still strong. Last year was my fifti eth
year in this business and it's never been more varied
in what sold, from the sublim e to the ridi culous. Still


some high grade sold , but also

low grade and everything in
between . Custo m ers are not
o pposed to what my dad used
to call ' naats,' diam o nds that we
would have as compariso n diamonds
that people would never buy. And now they're
not o pposed to th em. You can put them into a pi ece
and mix it up with som ething that's a little bit more
stylish;not necessarily bridal, but something that would
be m ore of a fashion piece.
" I will probably fill in some things, not necessarily a
whole line. Galatea did well and ArtCarved bridal is still
really big for us."



"We're not restocking necessarily bu t for fill-ins,
it would be som e of our fast-sellers. For example, I'd
restock st erling sil ver and diamond brace lets from
C harles, Garnier that sold very quickly. And I'd restock
Belle Etoile e nam eled an d crystal pi eces - it's a
price-point line. Also Breu ning, which is sterling silver
with gold accents and some diamonds and gemstones,
I'd restock some pi eces from that as well.
" In terms of diamonds, we're pretty well stocked there.
Best sellers in general for diamonds are Simon G. and
R oberto Coin, which did very well, and C herie D orie,
which has tim diamond things . Diamond j ewelry is our
number one itenl."
" Pand ora, of course, was o ur numb er one fo r the
holidays and John Hardy, which was our number two. And
diamond stud earrings also were what sold. We actually

sold larger ones,a few pair of1-carats

and 1.50-carats and 2-ca rat~. ln terms
of fashion jewelry, it was basics, like
single-stone pendants, that sold."
"We try not to restock after the holidays because there
is such a lull this time of year.We do just necessiti es.
We stock so much before the holidays, we usually wait
until the springtime before we restock.
"We sell silver and diamond bands and then there's
a whole vast variety of o ther things . We had the best
Christmas in 2015 that we've seen sin ce the recession .
But it was an array of items that sold, everything from
sterling to Paraiba tourmalines that go for $300,000 .
We had a very good holiday season but it wasn't
just pearls and it was n 't j ust di amo nds, it was across
th e board."
"We did pretty well wi t h di amo nd pi eces
necklaces and earrings, but not as much with rings. So
I would fill in a little bit with the diamond pieces, the
simpler pieces, such as gold diamond bar styles, which
seem ed to do well. We did see a pi cku p with yellow
gold , earrings in particular, at the holidays. So I'll be
restoc king on the yell ow gold items, too. We were a
little disappointed with color; sapphire as always was the
best seller in colored stones.We had a consignment case
and that did very well at the holidays, mainly because
people associate that with a good value. Usually every
D ecember we have a couple of good sales, over $7,000
or $8,000, but we didn 't have that this year. It was more
th e smaller items, not the one big sale." "
Rapaport March 2016 109

u.s. 2015 Jewelry Sales Up

Revenue from jewelry and watches grew 18.9 percent

to $3.75 billion.
Jewelry and wat ch sales increased 8 petcent before
currency considerations and 19 percent after currency
consideratio ns. Th e stro n g momentums of Bulgari,
Chaumet and Hubl ot througho ut th e world we re
attributed to the segment's outstanding perfotmance.
Bulgari's performance was reported to have improved the
business group's operating margin by 3 percentage points.

u.s. jewelry sales from

all re tail o utl ets improved

2.2 percent year on year to $66.93 billion for the full year 2015,
according to data from the Bureau of Economic Analysis.
Combined sales of watches and jewelry for the year totaled
$75.74 billion, a growth 02.2 percent year on year.
Watch sales for 2015 rose 2.3 percent year on year to
$8.81 billion.
Jewelrysales in December2015 grew2.2 percent year on year
to $13.28 billion, according to R apaport News estimates.
Watch sales in December 201 5 climbed 2.4 percent to Blue Nile Sales Shrink
$1.74 billion, according to R apaport News estimates.
O nlin e retailer Blue Nile's sal es fell 4 .8 p ercent
Th e U.S . consumer price ind ex (CP I) for jewelry year on year to $150 million in the fourth quarter that ended
increased 6.7 percent in January 2016 from D ecember January 3,2016. Overall net sales for the tIll fiscal year ticked
2015 according to the U.S. Bureau of Labor Statistics.The up 1.4 percent to $480. 1 million. Blue Nile described the
C PI was 2.9 percent higher year on year. The C PI for weakness of high-ticket purchases and foreign currencies
watches increased 2.6 percent inJanuary from the previous challenging tevenue growth.
m onth and was 0.8 percent higher year on year.
U.S. engagement net sales for the fourth quarter decreased
7.7 percent to $78.4 million and improved 1.3 percent
LVMH Reports Strong Year
to $269.9 million for the full fiscal year.
LVMH Moet H ennessy LouisVuitton reported revenue U.S . nonengagement net sales sl id .3 p ercent t o
growth of16.4 percent year o n year to $40.38 billion for its
$48.7 million for the fourth quarter and rose 1.8 percent
fiscal year ending December 31 ,2015 - a record year for
to $128.3 million for the full fiscal year.
revenue and profit from tecurring operations. The strong International net sales dropped 3.2 percent in the fourth
performance was attributed to various factors including
quarter to $22.9 million after currency considerations, but
favorable exchan ge rates for the Paris-based luxury
grew 5.4 percent at constant currency rates. International
net sales gained 1 percent to $8 1.9 million after currency
group, the progtessive normalization of China and good
considerations, and jumped 9.9 percent at constant
performances in it~ wines and spirits,jewelry and watches
and fashion segments.
currency rates.

Jewelry Stock Index

Rapaport Jewelry Index




Blue Nile




Signet Group





Tiffany & Co.

110 Rapaport March2016








OowJones lndex -

Rap Jewelrylndex

CTF Sales Plummet

Chow Tai Fock (C TF ) J ewellery Group saw
retai l sa les plun ge 29 percent year on year from
January 25 to February 14,2016,covering the 14 days prior
to and the first seven days of Chinese New Year. Overall
sam e store sales also fell 28 percent.The period leading up
to the holiday usually represents the busiest time for many
C hinese com panies .
R etail sales and same store sales in Hong Kong and Macau
slid 23 percent and 22 percent by value respectively. Retail
sales and sam e store sales for Mainland C hina tumbled
30 percent and 31 percent respectively.

- Th e company attributed the downturn to an outflow

of holiday consumption as a result of th e in crease in
M ainland China's outbo und travel during the C hinese
New Year period . C TF also mentioned weakening
conmmer sentiments on luxury goods due to the economic
slowdown and recent volatility in the stock m arket as
having played a part in the poor performance.
The sales decline in Hong Kon g and M acau were also
attributed to the declining visitation fro m Mainland
C hina and continued weak local retail sentiment.
C TF anticipates the business envirorullent to continue to
be challenging and that sales performance in the foutth
quarter w ill be worse than in the third quarter.

Michael Hill's Revenue Grows

Michael Hill 's gro up revenu e jumped 9.7 p ercent
year on year to a record $224.3 million in the first half of
its fiscal year that ended December 31, 2015. Sam e store
sales also went up 5.4 p ercent to $210 .6 million du ring
that period. Group earnings before interest and tax (BIT)
inched up .8 percent to $25.4 million.
The US. retail segm ent's revenu e spiked 24.7 percent year
on year to $7.4 million. M ichael Hill opened its second
New York store in Septemb er 2015 at the Triple A Mall
Roosevelt Fields.
The Australia segment saw revenue improve 4.2 percent
to $126.7 million, despite the ch allenging retail market.

Consumer Confidence Inde

"' - - - - - - - - - - - - - - - - - - - lII-


The New Z ealand segment sh owed a revenu e growth of

6.7 percent to $45 million, and is benefitting from a stable
and experienced leadership team.
The Canada segment's revenue jumped 18.8 percent to
$38.7 million . As the brand builds in the segment gross
margins continu e to lift as the brand achieves economi es
of scale for advertising and overh ead .
The Enm1a & Roe brand continues testing its expansion
program, opening three stores in 2015 bringing the total
to 11. Th e brand will open another five new stores over
the next six months as part of its test.

Gitanjali's Revenue Dips

India-based G itanj ali Gems reported th at revenue
d eclined 1.5 percent year o n year to .$365 million in
the third quarter that ended D ecemb er 3 1, 2015, du e to
regulatory restrictions on import of gold and unfavorable
currency con ditions against the US. dollar.
Diamond sales declined 19 .8 percent year on year to
$95.6 million during the third quarter. In the nine months
th at ended December 31, diamond sales decreased
17 percent to $239.2 million.
Jewelry sales in the third quarter were 7 percent high er
year on year at .$215 million. In th e nine months that
ended December 31,jewelry sales spiked 40.6 percent
to $560 million .

u.s. Retail Jewelry Store Sales

$ Billions

2011 1.65 2.27 2.01 2.23 2.67 2.11 2.02 2.22 2.12 2.04 2.50 5.72
2012 1.67 2.60 2.05 1.95 2.67 2.14 1.94 2.11 2.04 2.05 2.53 6.03
2013 1.78 2.53 2.13 2.23 2.70 2.12 2.00 2.14 2.01 2.23 2.67 5.77
2014 tag 2.61 2.14 2.211 2.63 2.16 2.13 2.22 2.03 2.16 2.51 5.56
2D15 1.77 2.47 2.03 2.22 2.77 2.28 2.19 2.22 2.02 2.13 2.57 5.89
Total Year Year-to Date % Change














Annu al Percentage Rates




Rapaport March 2016 111

Forevermark Supports Rhino Rescue

Forever mark, the diamond brand from De Beers,
partn ered with safar i speciali st EXPLORE Inc. to
support rhinoceros rescue efforts in Botswana. The two
companies held a private dinner in February for more
than 100 guests at Le Bernardin Prive in New York City,
hosted by chef and owner Eric Ripert.
The event launched the U.S. ann ofthe TlhokomelaTmst
- the name of the fimd m eans "to protect" in the local
Setswana language - and it was designed to protect
BotsWana's wildlife from extinction.
Guests included T shekedi Khama, Botswana minister

of envi ronment, wi ldlife and tourism, ac tress

Urna Thurman, activist Gloria Steinem an d more.
- Th e event was conceived by C h erri Briggs from
EXPLOlt E Inc. after taking Ripert and Thurman to
BOL,\wana to raise awaren ess about the plight of rhinos .
- Forevermark's support of the Tlhokomela Trust is part
of De B eers beneficiation effort in Botswana, where
it jointly operates the mining venture D ebswana with
the Botswana goverrullent. Balisi Bonyongo, managing
director of D ebswana, is also the chairma n of the
Tlhokomela Trust.

launched in winter 2015. Th e camp aign spreads the

message of romanticism, togetherness and devotion.
- Scott K ay also ann o unced a partnership with the
Fashion Institute of Technology in New York C ity.
The partnership, of which details were not yet released, will
begin J anuary 2017 .

Blue Nile Opens Second Webroom

Online jewelry retailer Blue Nile will open a second
"webroom" at the Westchester Mall in White Plains,
New York. It is expected to open by early sununer 2016 .
The physical space, featuring in-store tablets, w ill allow
visitors to view produ cts and place orders from it~ online
catalogue with the help of nonconmUssioned consultants .
This model enables the company to generate higher sales
per square foot than a traditional jeweler while maintaining
prices below its brick-and-mortar comp e titors , said
J u l ie Yoa kum, chief merchandising officer at th e
compan y. Blu e Nile o p en ed its first webroom at the
Roosevelt Mall in Garden C ity, New York inJune,2015
and the White Plains location is the first offour webroonL'>
expected to open in 2016.

JAPAC Raise Record Amounts

Scott Kay Rebrands
J ewelry brand Scott Kay announced it has rebranded
with a new visual identity and advertising campaign
since the passing of its founder, Scott Kay, in 201 4 and
acquisition by Frederick Goldman Inc. in 2015.
- The brand inlplemented it,> signature purple hue across
all asset'> including updated packaging, in-case displays,
website, social media and marketing collateral.
- T h e hue is also worked into its revived advertising
camp aign titled "A Life Togeth e r," which officially

112 Rapaport March 20 16

The J ewelers ofAmerica Political Action Conu11ittee

OAPAC) - the PAC that lobbies for the j ewelry industry
in Washin gton D C. - raised $26,680 in 2015. That
includes a fundraiser where JAPAC raised $16,450 at the
July Board of Director's meeting - the biggest amount
raised in a single day in the conullittee's history.JAPAC has
worked on extending leasehold improvement depreciation
provisions and is currently working on issues including
efforts to pass sales tax fairness legislation and protecting
the last- in,first-out (LIFO) accounting method from repeal.

Richemont Acquires Roger Dubuis

Swi'iS-based luxury group rUchemont has acquired the
remaining 40 percent of watchmaker R oger Dubuis,
giving it full ownership, reported R euters.Both companies
have declined to conunent on the sale price, though
the amount was likely to be less than R oger D ubuis'
annual sales, estimated at around $65 million,Vontobel
analyst R ene Weber told R euters. Akram Aljord, an
investor and chief executive of the watch brand H ysek,
previously owned a 40 percent stake. Analysts have
also predicted that a weak luxury watch market could
provide prime conditions fo r smaller players to be
snapped up by bigger groups such as Swatc h Group,
LVMH , Kering and R..ichemont.

Platinum Jewels in Bloom

Platinum Guild International (pGI) teamed up with
the Madison Avenu e Business Improvement District
(BID) in N ew York City to sponsor" PlatinumJ ewels in
Bloom," a to-day fl ower and j ewelry show.The event,
which took place in early February, was in support
of th e Central Park Conservancy's Playground
Partners, whose mission is to fund the daily care
of rh e 2 1 playgrounds in th e park. Partici patin g
jewelers mad e a combined do nati o n of $25,000 to
Playground Partn ers. Eighteen jewelry boutique,s ~~....
located on Madison Avenue between 57th and
86th streets were part of th e program including
Alexis Bittar,Asprey, C hopard, David Yunnan,
Paul M orelli, Po m ellato and Stephen Russell
among oth ers. Th e retailers showcased floral
arrangements inspired by the flowers in Central
Park w ith platinum jewelry and PG I signage in
their windows to highlight the w hite metal. Th e
Madison Avenue BID and PG I hosted a press tour
of th e w ind ows for bloggers and editors to furth er
promote platinum. As an additional bit of promotion
fo r platinum, flag style signage along Madison Avenue
featured PGr as a sponsor of the event.

Zales as Official Ring Provider

Zales J ewelers has been named th e official r in g
provider to th e 2016-2018 enshrinement classes of
the Naismith Memorial Basketball Hall of Fame, a
M assachusetts-based organization promoting basketball
at every level, from hi gh schoo l to professional.
Zales will host a series of "Hometown Celebrations
fo r H all of Famers" to conullemorate the achievements
ofvarious players and coaches as part of the partnership.
A special exhibit featuring the official rings will
also b e o n display at the Basketball H all of Fame .
The H all of Fame Class of 2016 inductees will be
announced o n April 4, 2016 .
Rapaport March 2016 113

Design is Worldwide Patented

B K Jewellery

www.bkjewelry.com lE)

Location: Hong Kong, Canada, USA, UK, China

JUNE 3 - JUNE 6, 2016




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Tucson is the gathering place for colored gemstone dealers and an

annual event that draws attendance from all areas of the industry
emsrone enthusiasts made their annual
pilgrimage toTucson,Arizona, for the colored
gemstone shows that ran from J anuary 28
through February 14. Known in the industry
as "Gemstone M ecca," this event is very imp ortant
to gemstone collectors and sellers to see what is new,
unusual or to replenish inventory
The event takes overTucson, with 30 gem shows located
in and around the city that are held in m otels, tents and
galleries to acconunodate the thousands of exhibitors
and buyersTheAmerican GemTradeAssociation (ACTA)
gem show, held in the Tucson Convention Center, is the
focus for most buyers. Douglas Hucker, chief executive
officer (CEO) of AGTA, expl ains, " It is an exhibitor
member-only driven show where people can shop th e
best-qu ality colored gemstone inventory comfortably,
knowing there is a standard and strict disclosure guideline
behind every ston e they buy." Th e o ther shows, such
as the Gem & J ewelry Exchange (GJX) have m ore
appeal with designers like Julie R omanenko, design er
and owner of Just Jules in Scottsdale,Arizona, who says,
"GJX is more inspiring for designers because there are
more exhibitors who have selections of one-of-a-kind,
new and unconunon stones." H owever, she adds, " I go
to AGTA because I have specific exhibitors to see and
stones to buy."
120 Rapaport March2016


Bu yer rurnout for the shows this year was very

good, even with the Asian economy and the U.S. stock
market in flux. Hu cker notes that this year AGTA saw
a 12 percent increase in buyers' attendance over 2015.
But were they buying o r looking? B ru ce Bridges,
of Scottsdale, Arizona-based Bridges T savo rite and
ACTA exhibitor, says, " Th e peopl e that came were
there to bu y." This may be because as R eem a Keswani,
founder of Golconda in New York City and a GJX show
exhibitor, points out, " Th e budding designers may
have stayed home this year, but the serious buyers with
long-established businesses could not afford to miss
the show," adding thar after Chr istmas, retailers and
manufacturers need to stock up on goods for inventory.
With so many shows going on simultaneously, t he
challenge for buyers is to make enough time to navigate
all the shows to see what is new while also buying the
gemstones needed for inventory and clients. As a result,
the most seasoned buyers come prepared with a "grocery
list" ofgemstones they would like to purchase. Exhibitors
say that bread-and-butter items were on buyers'lists this
year. Amit Birani, president of Original Gems, Inc. in
New York City and ACTA exhibitor, says, "Buyers were
serious this year, focusing on goods that are easy to sell
and replenish, like sapphires , rubies and emeralds in the

1-carat to 3-carat rangeThese are more sellable than large for the unusual or odd stoneThe demand for these types
unheated or treated sapphires,mbies and emeralds." Hucker of stones is growing, along with an increase in prices
says the lack ofsales in these categories ~ emeralds, rubies for them . Keswani says, " In the colored stone world ,
and unheated sapphires ~ was due to " price resistance the gemstone shows in Tucson are kn own for a great
to those items." As many in the
selecti on of all the weird odditi es
industry know, prices for
but nothing was cheap
this yea r. These item s
unheated ruby, sapphire
and emerald have been
were commanding
on a meteoric rise over
serious prices and real
competition among
the past couple ofyears,
so buyers were playing
exhibitors." Keswani
it safe purcha sing
sees this as go in g
stones they knew
from a trend to a
they could sell easily.
bifurcation in the
Keswani says, "The
indu stry. "Th ere is
US. is a strong market
a hu ge mark e t
developing for all
for 2-carat to 5-carat
sapphires but to sell
the unusual t h ings
a 5-carat to 7-carat
that all the designers
ston e that is $10,000
are using, including
to $15,000 per carat
natura l and icy
at Tucson is tough. This
~ opaque and gray ~
event is much stronger across
diamonds. " It used t o be that
the conunercial band generally
Tsavorite . Photo by leff5covil for Bridges Tsavorite .
there were one or two people
speaking, and most buyers this year were in the mood to at these shows servicing these niches and that is no
buy cautiously."
longer true; it is not a one-off esoteric purchase. That
This seemed to be the case with other fine gemstones part of the market is grow ing and it is no longer a
as well.Bridges says stones in the 4-carat to 6-carat range, single-digit market share," notes Keswani .And this new
his "bread-and-butter"sizes,did really well. H e was happy market extends beyond th e U.S. Keswani goes on to
with the show because he exhibited with a filll production observe that her clients from Colombia and Uruguay
of hundreds of calibrated goods and in sizes of8x6nun, are buying opaque and icy diamonds for markets in
7x5nml and 6x4null and those sizes yielded strong sales. South America that were not traditionally known for
Bridges went on to say buyers were not buying the big using these diamonds. The creativity that American
"wow" at the show.Those who were interested in larger designers are exhibiting using nontradition al ston es
sizes followed up after the show to close the deals. Other and m etals is having a ripple effect in other markets.
Another trend is how new young designers and buyers
exhibitors echoed these observations saying that buyers
were serious, but more price-focused and buying more are finding wholesalers and manuacnrrers. It used to be that
volume, but what amounted to smaller sales.
ifan exhibitor bought a lot ofshow ad~ there was a certain
level of guaranteed visibility. But the internet has leveled
the playing field. Now a younger group of20-year-old to
In 2015, Romanenko says, "Everyone was looking 40-year-old buyers are looking for new vendors based on
for morganite. This year, I didn't see as much." Hucker the firm's presence on social media. Keswani said several
offered an explanation that the Pantone color for 2014 new buyers found her through Imtagram. Th ey were
was radiant orchid and its popularity carried over to 2015. familiar with her gemstones and diamond~ and came ready
There was the perception that morganite was the least with a list of goods they wanted to see.
TheTucson gemstone shows continu e to be inlportant
expemive stone closest to that hue. The 2016 Pantone
colors are rose quartz and serenity. Some exhibitors have for new and established buyers.As Hucker says, " If you
already seen an increase in demand for rose quartz and see it in Tucson, you have to buy it because you won't
pairing those shades \vith the slightly darker tourmalines see it again at another show." A good buy on a layout of
and rubellites as accent stones.
calibrated stones or the chance to find a unique piece
While Pantone's selection of the color of the year can make a season for buyers, retailers and designers .
may increase the demand for color gemstones in that Gemstone enthusiasts know the only place to find a stone
pal ette range, many new designers and bu yers look with such power is in Tucson .
Rapaport March 2016 121


While some dealers came to the annual Miami antique

show w ith low expectations, they left cautiously optimistic.
ith 100 dealers filling a ballroom
dedicated to antique, estate and vintage
jewelry, as well as many others spread
throughout the show floor, the Original Miami Beach
Antique Show 2016 was once again the scene ofhigh-end
luxury jewelry and gem horse-trading. According to
the final figures, the show, held January 28 through
February 1, was up 3 perce nt in attendance for all
five days. And while some dealers experienced good
traffic throughout, others felt it was less than usual .
But ultimately, jewelry and gemstones changed hands
among dealers and buyers from around the world and
across the U.S.

" I thought the show was medium to good," says

Diana Singer, D&E Singer Inc. , New York City.
Gus Davis, partn er, Camilla Dietz Bergeron , Ltd.,
New York City, says overall, he was quite pleased.
" I was expecting less and was surprised at how well
we did." Jeff Russak, owner, Lawrence Jeffrey Estate
J ewelers, Litchfie ld, Connecticut, says he found the
mood more upbeat than 2015 . He also rated the show
as "moderately successful."
By th e e nd of th e show, notes J eff Cohen,
N. Green & Sons, Chicago, Illinois, "people had a better
opinion than going in.There was a very heavy presence
122 Rapaport March2016

of trade looking for loose and colored stones and loose

diamonds and melee goods.We saw a lot of activity with
fine, signed, well-made jewelry."
What did have an effect on the show many dealers felt
was the weakn ess offoreign currencies and the absence
of the "usual" foreign buyers. " This year, the number of
Asian buyers seemed to have dropped off;' says Janet Levy,
principal,]. & S.S. DeYoung Inc. , New York City. "The
problems in China are the stock market and the loss of
people's net worth. Added to that is the anticorruption
campaign that has been going on for a couple of years
now and people are not moving their money and not
spending their money."
T h ose who did com e, however, were there to buy.
" The Chinese dealers were looking for coral and jade.
And the European dealers were looking for pretty,
salable goods at decent prices.And I think that they were
not disappointed," says Singer. " It was very much of a
price-point show. Whatever people were buying, they
wanted it to be a decent price or else they would let it go."
People were negotiating, Levy says . "Sellers were
realistic. While asking prices for splendid signed pieces
were beyond what they've ever been, for everything else,
if th ere was a willing buyer negotiating in good faith,
deals were made."
opposite: Yellow gold textured rope-style earrings, circa 1965.
Photo courtesy Camilla Dietz Bergeron, Ltd.

According to Levy, better goods sold quickly the first
day or two, " mostly among th e dealers," and lower-end
merchandise "sold to buyers there for bargains," but the
middle range is very soft. Agrees Davis, "What was not
selling were the smaller items, lower to mid-range, that

a lot of the stores if they'd had a good Christmas

season would have come to restock."

Singer says she saw a " huge resurgence in

desire for wearable Victorian jewelry - long
chains, bracelets, rings and earrings - as well as
large chunky bracelets." Also popular, sh e says,
was yellow gold.
Russak says he sold "tasteful one-of-

a-kinds and pieces with good colored

stones. We did not sell all-gold or
diamon d-se t pieces, whic h was
. "
a surprise.
Levy found people were looking
for diamonds and jewelry "more
si mpl e in styling, refl ecting a more
casual lifestyle, such as 1960s and 1970s
jewelry." Davis says dangling gold earrings
and long necklaces from the 1960s and 1970s
were popular, their more subdued look fitting
in today.
While signed pieces were on everybody's radar, Cohen
sold "a lot of price-point antique jewelry - $50 up to
$1,000 - that are within everybody's reach." H e also
says he noticed some activity once again in Art Deco
platinum and diamond rings and earrings.
According to Davis, old diamonds so ld - an old
Asscher cut or cushion cut in an original mounting.
Singer notes consistent interest in secondhand solitaires,
a carat and up, as well as good-quality colored stone
jewelry. " I sold ahnost all the aquas that I had," she says.
" I saw interest in pink tourmaline and colors that pop."
According to Levy, unheated rubies, Kashmir sapphires
are trading "at the Cartier level. They're going for more
money than ever before."

" I think this show was steady, and I expect the market
will be the same over the next year," opines Russak. Davis
points out that the recent stock market dips and the fact
that it is an election year are making people cautious.
"People are buying, but not so much of the over-thetop things ."
Causing some consternation at the show was the fact
that there will be a venue change to the Miami-Dade
County Fair Expo Center next year while the Miami
Beach Convention Center, which normally houses the
show, is renovated. " There was a lot of negativity about

the new venu e," says Davis. "But I'm positive about it.
I think it will be very interesting. Miami is still the big
show for the trade and it is a real pulse of the market."
One thing this show made clear, says Cohen, is that
the market is changing. " Prices have changed, in melee,
in big diamonds . Some jewelry that had been bringing a
good dollar is now a little soft." But, Cohen sums up, " I
think going forward, the future of our industry still looks
good.These beautiful j ewels and luxury goods have been
bought, sold and traded for thousands of year. They're
not necessities but they're what keeps life interesting. So
people will indulge and buy, sell or collect them. And
that's what will keep the industry strong." .
Rapaport March 2016 123


The recent NY NOW gift show revealed a shift in design trends .


or those looking to fill their cases with

design-oriented jewelry, the NY NOW gift
show is the place to go.An increasing number of
fine jewelry designers are making an appearance at the
show. The majority of th ese designers offer diamondaccented, fashion-forward jewelry at accessible prices
and a number of the exhibitors also had a selection of
alternative bridal.
Designers concurred that there is a move back to
traditional white diamonds, as opposed to the opaque
diamonds that have been so prevalent the past several
years. " In terms of bridal, buyers want more traditional,
larger three-stone rings.There is more ofa move to white
diamonds," says San Francisco, California- based designer
R ebecca Overmann." I am really excited about old Eums
and old miners - taking them out of vintage jewelry
and giving them new life in modern settings."
Jul ez Bryant DeCosta , designer and owner of
JulezBryant in Carlsbad, California, fo und that rose gold
was trending with her customers. She is also noticing a
move away from deep, dark color diamonds to whiter
stones."Buyers are looking for bridal for their stores that
is cool and different. Today's brides are more eclectic in
their tastes. We use a lot of uniquely shaped diamonds
mixed with rose cuts.We like to pair a diamond ring with
a more m etal-intensive band to create a sparkly, organic,
personal look."
124 Rapaport March 2016



New York City designer Suzy Landa , whose line

prominently features colored gemston es, notes that
"people are attracted to color, but they buy diamonds
because they are safer. Buyers gravitate to items that have
an understood value.When a piece is above a certain price
point, retailers feel more comfortable selling diamonds ."
One of the hottest trends at the show was earrings.
Specifically, small post earrings, continues Landa."Smallscale earrings that are little pops of color that are subtle
and easy for every day are doing really well."
Page Sargisson, aNew York City designer, noted
that in addition to her lS-karat gold and diamond or
sapphire collections, buyers were also purchasing small
post earrings for their store. "People are buying more
small-scale earrings because of multiple piercings.They
also bought our ear hugge rs, which are made to fit
piercings on top of the ear. It caters to the Millennial
market," she obser ves.
On that same note, ear jackets, ear climbers and ear
cuffi are becoming increasingly important as they create
a look of multiple piercings without actually having to
get ears pierced in numerous places.

Above: Diamond bangle by Sarah McGuire . Opposite page, top:

Snake ring by Delphine Leymarie. Bottom: Diamond and 18-karat
gold bracelet by Page Sargisson.

Delphine Leymarie, of the Manhattan-based company

Delphine Leymarie Fin e Jewelry, also found single earrings
to be a "popular" item."People are going for smaller layering
and stacking pieces, such as necklaces with different length
chains and different textures that work together. The person
wearing the jewelry creates volume by wearing pieces together
and they can mix and match items to make the look their own. I sold a
lot of single earrings for a mix and match look."
Over atTap byTodd Pownell , diamond solitaire earrings set culet up
were best sellers for the C leveland, O hio, firm. A client at the booth
described his work as" genius" for the innovative setting of the gems,
which is classic, but the culet-up setting is cool and just edgy enough
to find appeal with a younger consumer.
In an economy that is still pri ce conscio us, jewelry with small
diamonds in the $1,000 retail range was most popular and under $500
retail was particularly strong. Sarah McGuire, of Chicago, Illino is- based
Sarah McGuire Studio, said her best sellers were m oderately priced. "We
are selling pieces with sprinkles of melee diamonds. It is a nice way of getting
moderately priced jewelry that feels special. We are still selling rustic diamonds,
but people are starting to look for more genuny stones that are closer to a white
diamond, but still have interesting shapes and cuts."
San Francisco, Califo rnia- based designer Corey Egan, who specializes in
alternative bridal, found that stacking bands were doing especially well. "People
like to add to the collection that they already have."
Jewelry with a handmade, one-of-a-kind feeling was an important trend at the
show; more modern looks with architectural, geometric forms were also directional.
Classic pieces with clean lines are important as consumers gravitate back to basics,
but with a twist - a classic eternity ring with llllsmatched rose cuts, or baguettes.
While blackened metal remains a staple, it is brightened with gold, silver or the
sparkle of diamonds to lighten up the look. Overall, jewelry design is m oving to
lighter, more open forms with simple, classic shapes taking center stage creating a
contemporary sensibility.

Rapaport March 2016 125

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48 We" 48.h Stree. , Suite 403, New York , NY 10036
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by Amber Michelle

beautiful m ovie star, a tal ented design er, fabu lous gemstones and a
humanitarian mission all play into the yellow citrine necklace donated to
the Smithsonian National Gem Collection by film actress
Angelina Jolie Pitt. D esigned with 64 graduated bezel-set
cushion-cut citrines set in 1S-karat yellow gold , the
necklace features a 177 .tt -carat pear-shaped citrine
drop. Named th e Jolie Citrine Necklace , the
jewel is on display in the Janet Annenberg
Hall of Geology, Gems and Minerals
of the Smithsonian National Museum
of Natural History in Washington, D. C.
It "vill be on display indefinitely.
The necklace is from the Style ofJolie
jewelry collection, a collaboration between
Jolie Pitt and Amer ican j ewelry designer
Robert Procop. Th e collection was
d evelo ped by Jolie Pitt to promote edu ca tion
and es tablish sc ho ols in nati o n s affected b y
conflict. Proceeds from the sale ofjewelry from the
Style ofJolie collection are donated to the Education
Partnership for Children in Conflict, w hich builds
sch ools for children around the world. Th e first sch ools
were built in Mghanistan . " Robert and I are honored to have
this great institution feature on e of our jeweled creations," says
Jolie Pitt."As the Smithsonian has edu cated so many of us, thisj ewel
is a symbol of o ur efforts to help educate underprivileged children in
conflict areas of the world ."
This is the first piece of dtrin e j ewelry in the National Gem collection.
C itrine is a variety of quartz composed o f silicon and oxygen. It gets its color
fro m traces of iron and ranges in shades from golden yellow to orange. The name
dtr ine com es fro m the French word dtrO tl , which m eans lemon, and references th e
yellow color of the stone. "We are thrilled to receive this important piece for the
Smithsonian ," conm1ents Jeffrey Post, curator of the National Gem Collection.
" It is the first piece of citrine j ewelry in the collection. The fact that it was
personally designed by AngelinaJolie Pitt and Robert Procop makes it all the
m ore significant."
The JanetAnnenberg Hall of Geology, Gems and Minerals is one ofthe most
visited exhibitions at the Smithsonian and is home to the Hope Diamond.
" I am honored and also humbled to have our d trine necklace placed among
the great jewels of the permanent collection of the Smithsonian Institution;'
concludes designer Procop. " From one endeavor, Angelina's creative vision
draws two equally impressive outcomes: to transform the finest gems into works
of art and ultimately to improve the lives of many that are in need." "
126 Rapaport March2016

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April 13th - April 16 th WashingtonD.e

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