March 26, 2004
Diamond News Report
Here's a roundup of the latest news from diamond centers worldwide:
Twenty Israeli diamantaires canceled trips to the World Diamond Council meeting in Dubai, March 30-31, citing advice by Israeli security officials that travel would be a risk following the death of Hamas leader Shaikh Ahmad Yasin in an Israeli attack, says the Rapaport Report.
Shmuel Schnitzer, president of both the Israel Diamond Exchange and the World Federation of Diamond Bourses, said he explained the situation to all parties in Dubai and they understood: "The Israel delegation will go to Dubai when the atmosphere improves, but this is just not the right time," he said. "As the WFDB president, I'd like to add that I know it will be a good conference and an important one and I am sorry to miss it. I think Eli Izhakoff is doing a great job as WDC chairman and I wish him success."
BHP Billiton, the world's largest diversified mining group, rebuffed an approach for its Ekati diamond mine from an Israeli consortium for the second time, saying the business was not for sale, reports the Financial Times of London. BHP, Melbourne, Australia, said its diamond business was highly profitable and it planned to expand its presence in the sector in partnership with others. "We are seeking to grow this business, not exit it," it said.
On March 24, DGI Group an Israeli consortium led by diamond merchant Dan Gertler said it raised $2 billion to buy diamond assets around the world and Ekati was at the top of its list. BHP holds an 80% stake in Ekati, which began production in 1998 and lies just 125 miles south of the Arctic Circle. The remaining 20% is owned by the two geologists who discovered the mine in 1991. It is BHP's only producing diamond mine and one of only two in Canada, although the company has recently entered into exploration joint ventures in the segment.
BHP Billiton became a member of the Natural Colored Diamond Association recently, joining miner Rio Tinto as one of two mining companies belonging to the new association, which promotes natural colored diamonds.
The Julius Klein Group, with its affiliate company, Eliaz Diamonds, opened its Eliaz Diamonds Europe office in Antwerp, Belgium this week. The office, which will be managed by Dan Hartal and overseen by Azri Garty of Eliaz Diamonds, is responsible for all of the Julius Klein Group's polished diamond sales and marketing activities throughout Europe. "We are extremely excited and proud to be opening this new office in Antwerp," says A.D. Klein, president of the Julius Klein Group. "We anticipate many great opportunities to come from this endeavor, leading to even greater international growth and expansion." The group has been manufacturing and distributing diamonds and diamond jewelry since 1948. A Diamond Trading Co. sightholder with offices worldwide, the group has an inventory that covers the entire range of diamonds from melee to more than 100 carats, colors (commercial to D and fancy colors), rounds and fancies. Other U.S.-based Julius Klein Group companies include Julius Klein Diamonds and Ritani in New York city and JKD West in Los Angeles.
New York City
The Diamond Information Center at J. Walter Thompson announced retail sales of diamond jewelry increased by 6.1% in the U.S. in 2003. U.S. diamond jewelry retail value representing over 50% of world sales totaled $29.1 billion last year, a $1.7 billion increase over 2002 sales of $27.4 billion. Transactions grew by 5% over 2002 and average ticket price showed 1% growth.
"The diamond jewelry industry has become increasingly focused on strong product ideas and effective marketing," says Richard Lennox, director-in-charge of the diamond marketing and advertising group. "At every level of the marketplace, retailers and manufacturers offered concepts with emotional appeal."
Three-stone diamond jewelry was a key driver of success in 2003. Over the past three years, three-stone diamond jewelry has become a $3 billion market segment. Three-stone pieces grew by 57% in 2003 on top of 74% growth in 2002. The three-stone diamond anniversary ring is the cornerstone of this new market segment.
In 2003, diamond engagement rings reached their highest average price at $2,500. They were acquired by 83% of U.S. brides last year, producing a total retail value of $4.3 billion, 1% higher than 2002.
Along with traditional pieces and newer favorites, the 2003 diamond jewelry market was sparked by the arrival of diamond right-hand rings seen on celebrities at awards events and during New York Fashion Week. Print ads from J. Walter Thompson struck a chord with consumers, as 65% of women surveyed say a diamond right-hand ring is a good way to express individuality.
A film called Blood Diamonds debuted in Africa this week, reports the Standard Times in Freetown, Sierra Leone. The movie, which was shot on location in Freetown and helmed by Nigerian-born director Teco Benson, tells the story of Don Carlos, a fictional local gangster, who is left a large cache of illegally acquired diamonds by the late Foday Sankoh, former leader of the now-outlawed RUF rebel group. RUF has been accused of committing countless atrocities against civilians for years in its quest to control diamonds in Sierra Leone.
Charles Taylor, ousted president of Liberia who was Sankoh's close associate in real life, figures in the movie too. As part of the story, he dispatches a team of mercenaries to Sierra Leone to take possession of the diamond for transmission to him in Nigeria. Don Carlos wants the diamonds for himself, but the Sierra Leone security forces also wish to recover the gems, thought to be the legal property of the state. After a series of encounters, the military and police security forces eventually succeed in eliminating and arresting most of the criminals and mercenaries involved in the scheme and retrieve the gems. The movie featured Nigerian and Sierra Leonean actors. There's no word on whether the film will be released elsewhere.