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Industry News: Diamond Prices Up Again; News From AGS, JA, More February 10, 2016 (0 comments)
Polished Diamond Prices Rise in January
New York, NY—Polished diamond prices rose again in January as shortages continue to support the market, especially in smaller sizes under one carat. A recent report from Rapaport says U.S. demand is steady after a reasonably good holiday season. The RapNet Diamond Index (RAPI) for one-carat, GIA-graded diamonds rose 0.9% in January. RAPI for 0.30-carat diamonds advanced 4.7% and RAPI for 0.50-carat diamonds grew 4.5% percent. The only decline RAPI posted was for three-carat diamonds, which fell 0.5%.
Although the RAPI for one-carat diamonds rose almost a full percentage point from the month before, the price is still off 4.4% from a year ago, as manufacturers sought to reduce excess inventory in 2015. This month’s report supports the theory that shortages, rather than demand, are driving prices back up.
Polished trading was driven by U.S. jewelers replenishing stock that was sold during the holiday season, as well as some inventory purchases, but uncertainty remains as consumer demand is sluggish in emerging markets. The stronger U.S. dollar is negatively impacting tourist spending in the U.S. and domestic dealer demand in India and China.
Diamond market sentiment improved during January and dealers feel that the worst may be over. Prospects for manufacturers’ profitability improved as De Beers reduced rough diamond prices by an estimated 7% to 10% at the January sight. The company’s sales surged 118% to $540 million during January, compared with $248 million in December. Rough demand increased as manufacturers started to raise polished production to fill gaps in supply.
Martin Rapaport, chairman of the Rapaport Group, in his January 28 statement ‘The Right Way Forward,’ anticipates polished prices to adjust to the realities of polished demand. “There may be some short-term corrections as a return to normal supply levels confronts relatively weak global demand, but we expect the markets to settle down quickly as long as the supply side of the equation remains consistent and profitable. As long as the diamond dream is kept alive demographics will support consistent demand,” he said, adding that the mid- to long-term growth outlook for the global economy is positive and the same is true for diamond prices and markets.
The Rapaport Monthly Report can be purchased here.
Separately, Shmuel Schnitzer, chairman of the Israel Diamond Institute Group of Companies (IDI), called on the Diamond Producers Association (DPA) to invest substantially in generic diamond marketing. Speaking in advance of International Diamond Week in Israel next week, Schnitzer said, “The DPA has the potential to generate great excitement among consumers. Generic marketing of diamonds is of critical importance in reinforcing the appeal of diamonds, especially to the younger generations of consumers. The DPA must at least meet, if not exceed, what De Beers spent in the past on generic promotions, which was $200 million worldwide. It’s crucial to return to an industry-wide perspective, to hit while the iron is hot and to plan for the long term.”
Ruth Batson To Retire From AGS Next Year
Las Vegas, NV—Ruth Batson (top of page), CEO of the American Gem Society and AGS Labs, is setting the stage to exit the industry after 23 years. In a release earlier this week, Batson announced plans to leave her post in summer 2017, spending retirement between a ranch in Montana and her home in Las Vegas.
AGS is forming a committee to search for her successor; Batson—whose entire industry career has been at AGS—will participate in the search and assist in the transition to the new leader.
Jewelers of America Political Action Committee Raises Over $25,000 Last Year
New York, NY—The Jewelers of America Political Action Committee (JAPAC), the only PAC that supports the fine jewelry industry in Washington, D.C., raised $26,680 in 2015. Through JAPAC, individual Jewelers of America members can join with other jewelry businesses in contributing to candidates who understand the interests of the jewelry industry and are running for office at the federal level.
JAPAC received a huge boost of financial support from JA Board members when – in response to a fundraising challenge – they raised $16,450 at the July Board of Director’s meeting. It was the biggest single-day of fundraising in JAPAC’s history.
“I applaud JA’s Board of Directors, who came together to give JAPAC a critical boost,” says JA president and CEO David J. Bonaparte. “With key issues like sales tax fairness being considered by Congress, jewelers’ voices must be heard on Capitol Hill.”
“JAPAC gives the jewelry industry a platform to have a collective voice on issues,” says Jenny Caro, JAPAC chair and co-owner of Jewelry By Designs in Woodbridge, VA. “These funds are an important tool in preparing JAPAC for the essential 2016 election year.” Caro has served on JA’s Board since 2013.
For more information about JAPAC as well as key legislative issues that Jewelers of America is tracking, visit www.jewelers.org/japac.
Diamond Growers Form Association
Merrick, NY—Like the unpopular kids in high school who form their own clique, 10 manmade diamond-growing companies have joined forces to create the International Grown Diamond Association. The aim of the new association is to promote grown diamonds, educate consumers and the industry about the qualities and applications of grown diamonds, and ensure the category—still striving for acceptance in the trade—is presented in a fair and technically correct manner across geographies and distribution channels.
“With IGDA, the grown diamond industry can present itself to consumers who wish a genuine choice in diamonds and commercial sectors who require high quality but consistent supply to develop diamond-based applications, said secretary-general Richard Garard, CEO of Microwave Industries. Other founding members include ILA Technologies, Washington Diamonds, New Diamond Technology, Scio Diamond, Golcondia, Pure Grown Diamonds, Polished Diamond Company, Diamond Foundry, MiaDonna & Company, and Chatham Created Gems & Diamonds.
Israel Diamond Week Adds Finished Jewelry
Ramat Gan, Israel—For the first time, the International Diamond Week in Israel (IDWI), open February 14 - 18, will feature finished jewelry in addition to loose diamonds.
The exhibition will feature jewelry produced by companies within the Israel Diamond Exchange (IDE). Finished jewelry on display will be both high-end pieces with fancy color diamonds and more casual pieces at accessible price points.
Gold and diamond rings by Israeli company GS Diamonds.
Leading figures within the international jewelry world, including celebrity designer Stephen Webster and Gaetano Cavlieri, president of CIBJO - World Jewellery Confederation, will be special guests.
IDE president Yoram Dvash said, "Diamond jewelry has become a substantial part of the business of the Israeli diamond industry. More and more IDE members are diversifying their products by introducing their own jewelry collections, taking advantage of the creativity and expert workmanship that our industry has to offer."
Accredited and confirmed buyers are offered three free nights in one of the IDWI's venue hotels in the Ramat Gan Diamond District. Register here.