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Rapaport TradeWire May 21, 2010

Growing concern over rough speculation as shortages and high prices continue to reduce cutter margins.
May 20, 2010 6:00 PM   By Rapaport
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  Rapaport TradeWire  
Rapaport TradeWire
RAPAPORT NEWS SERVICE | MAY 21, 2010   www.rapaport.com | news@rapaport.com
 
 
Retail Mining General Stats EconWatch India Jobs

 
RapUp May 21, 2010

Trading slow due to holidays in Israel and India. Industry hoping JCK Vegas show will signal U.S. recovery. Growing concern over rough speculation as shortages and high prices continue to reduce cutter margins. India’s Su-Raj Diamonds 4Q sales +24% to $201m, profits +342% to $6.3m. Bidz.com 1Q revenue -10% to $28.2m, net loss of $111K vs profit of $1.5m previous year. DGSE 1Q revenues -30% to $17.5m, net loss of $130K vs profit of $230K previous year. Petra Diamonds completes acquisition of Kimberley Underground mines, resumes operations. Zimbabwe’s SW Radio Africa reports Chinese company Anjin mining Marange concession.

RapNet Data: May 21, 2010
 
Diamonds 650,958
Value $4,794,513,645
Carats 738,629
Average Discount -30.61%
RapNet Asking Price

Get Current Price List | Subscribe to Rapaport | Join RapNet

 
ANNOUNCEMENTS
May
21
Fri
The Rapaport Price List will NOT be published on May 21 due to the Jewish holiday of Shavuot.
June
4-10
Fri-Thu
Rapaport
Rapaport Polished Diamond Tender Auction
at the JCK Las Vegas Show


Certified and non-certified diamonds. Single stone lots.
0.50 ct. to 5.00 ct, broad range of shapes and qualities.


The auction opens Friday June 4 at the JCK Vegas show and ends 5 p.m., June 10, at Rapaport New York office.

Viewing at the show: Rapaport Booth 3080, upper level.

Buyers: For appointment and bidder registration contact Rapaport New York Email: auctions@diamonds.net  Tel: +1-212-354-9800.

Motivated sellers are invited to submit diamonds at cash prices. Deadline for delivering diamonds: Thursday May 27. Contact Myles Schakler at Rapaport New York for information.
June
6
Sun
Rapaport Breakfast and Conference Schedule
New Date - Sunday, June 6
Marcello Ballroom
Venetian Hotel, Level 4

Rapaport Breakfast 8 a.m. - 10 a.m.

Martin Rapaport keynote address: "The Diamond Decade: New Opportunities"

Find out what is really going in the diamond industry. Transform change and challenge into opportunity.

Diamond Certification Conference 12 p.m. - 2 p.m.

From counterfeits to misleading standards, are certificates being used to mislead consumers? Join the debate and share how standards affect the business.

Fair Trade Jewelry Conference 2 p.m. - 4:30 p.m.

Join an open debate on the rapidly expanding wave of socially responsible jewelers who are promoting a fair and more ethical industry. 

The Rapaport Conference is free and open to all.
To register e-mail: conference@diamonds.net
or call +1-702-893-9400
June
14-17
Mon-Thu
Rapaport Pawn Shop Tender Auction
in New York

Over 35,000 carats of small to medium size diamonds in parcels.

Viewing by appointment only.
 
Contact: auctions@diamonds.net +1-212-354-9800

  QUOTE OF THE WEEK:
  A year and a half, two years ago, people were asking ‘Is luxury dead? Will people ever pay full price again?’ What we've learned this year, certainly this last quarter, is that they're paying full price, they're responding to the concept of scarcity and they love brands.

Stephen Sadove | Saks, CEO

Careers@Rapaport  
 
The Rapaport Group is growing rapidly. If you want to work with the best and brightest, join us. We have great opportunities for trading managers, gemologists, sales assistants, and entry level positions for our offices in New York, Antwerp, Mumbai, Dubai, and Shanghai. To get on the fast track, email your resume to careers@rapaport.com. Visit us at the JCK Show Booth 3080.


INDUSTRY  
 
U.S. Jewelry Prices +2% in April

The consumer price index (CPI) for jewelry in the U.S. rose 2.2 percent to 160.9 points in April 2010. Inflation for all product categories rose by the same percentage from one year ago. The CPI for jewelry marked the 27th consecutive cycle for which it registered more than 150 points. The index is based upon the reference point of average prices in 1986, which is set at 100 points.


 
De Beers is Asked to Move Aggregation to Botswana

Namibia's President Hifikepunye Pohamba called for De Beers to move its aggregation activities from London to Gaborone to help strengthen southern Africa’s status as a diamond hub. Pohamba said the move would assist in the integration of the Southern African Development Community (SADC) economies. De Beers initially planned to transfer its aggregation activities to Botswana in 2009, but postponed the move, saying that a number of key issues needed to be resolved before conditions could facilitate aggregation in the country. DTC Botswana chairman, Gabaake Gabaake, responded that negotiations are underway.


 
Rapaport Weekly Broadcast

WATCH NOW: Platinum Guild International showcased new designs that were under the $5,000 price point. Jennifer Singerman (pictured) of Platinum Guild explains the group's latest consumer research and provides a tour of the latest designer fashions using platinum, diamonds, and gemstones. Weekly retail sales and Saks' first quarter results reflected slow but steady improvement at retail counters given very easy comparisons.


RETAIL  
 
U.S. Chain-Store Sales +3%

Weekly chain-store sales in the U.S. rose 2.9 percent this past week, according to the International Council of Shopping Centers (ICSC) and Goldman Sachs. But sales inched lower from the previous week by 2.5 percent and ICSC blamed the drop on frigid weather, at least for May, in many parts of the nation. ICSC said the underlying pace of demand continues to be healthy and expects sales will increase by approximately 3.5 percent for the month of May.


 
U.S. Dept.Store Sales +1% in April

Department store sales in the U.S. during April rose 0.9 percent to $15.9 billion, according to government calculations. The figure dropped 1.5 percent from March results, which most likely reflected the calendar shift for Easter gift spending. Retail inter-trade sales rose 9.6 percent from April 2009. Sales across all retail categories rose 8.8 percent in April to $366.4 billion.


 
Bidz.com's 1Q Revenue -10%

Bidz.com reported first quarter revenue fell 9.6 percent to $28.19 million while costs remained unchanged at $21 million. Still, even with costs in check, the online jewelry auction website reported a loss of $111,000, compared with profits of $1.51 million one year ago. During the quarter, bidz.com recorded a 5 percent increase in the average selling price per order at $190. The number of items sold per transaction rose to 4.1 from 3 in first quarter 2009 while the number of new buyers dropped 21 percent to 40,501, and the average orders per day fell 16 percent to 1,713. Bidz reported it held $7.8 million in cash and $30.5 million in positive working capital with no long-term debt. The company reduced inventory by nearly $10 million during the three months.


 
Su-Raj's Diamond & Jewelry Sales +24%

Su-Raj Diamonds & Jewellery reported that its sales rose 24 percent to $200.6 million during its fiscal fourth quarter. Diamond sales fell 22 percent to $32.9 million, while jewelry sales gained 41 percent to total $167 million. Full fiscal year sales rose 26 percent to $681 million, while its diamond sales rose 6 percent to $160 million and its jewelry sales increased 33 percent to $521 million.


 
DGSE 1Q Revenue -30%

DGSE Companies' revenue fell 30 percent to $17.45 million and the company reported a loss of $130,151 compared with profit of $229,516 one year ago.


 
Sears, Kmart Launch Gold Buyback Program

Sears Holdings introduced a consumer gold buyback program in partnership with the Pro Gold Network that will be available at all Sears and Kmart fine jewelry counters. Each ProKit comes with detailed instructions and a prepaid shipping envelope. The kit is insured for up to $750 and can be tracked at a special url set up through sears.goprogold.com or kmart.goprogold.com. Consumers can receive their cash offers by email or phone and can accept or decline these offers before payment is issued. If a consumer decides not to accept an offer, his or her items will be returned immediately and free of charge.


 
Damas Sued for Breach of Contract

Damas International Limited said that it is being sued by one of its joint venture partners for $31.2 million (AED 114.7 million). Damas notified Nasdaq Dubai of the legal dispute filed by Al Manara Jewellery claiming that Damas Jewellery was in breach of a joint participation agreement between the two. The company firmly believes the case to be without merit and intends to vigorously defend its interests related to this civil action.


 
James Avery Plans Expansion into TN

James Avery plans to open its 56th store marking its entry into Tennessee. The new store will be near Nashville in Franklin at the CoolSprings Galleria come August. The retailer also plans to open a shop in Memphis later this year.


GENERAL  
 
CIBJO Releases 'Precious Metals Book'

CIBJO released its Precious Metals Book, the second book to be released since the 2010 Congress meeting n Munich, Germany this past February. Updates in the new version include a new appendix providing information on precious metal finenesses. The appendix can now be lawfully sold in CIBJO member countries worldwide.


 
'Keshi' Cultured Pearls Enter the Natural Trade

The Swiss Gemmological Insititute (SSEF) received large quantities of saltwater pearls for certification, but found that these new, better-quality saltwater pearls present a threat to the natural pearl market. The pearls are generally characterized by an almost perfect appearance and are often accompanied by reports describing them as natural pearls. Their appearance has however, raised doubt amongst many natural pearl dealers. The SSEF has adapted its pearl certification policy and is collaboratively promoting transparent standards at an international level to protect the natural pearl trade.


 
Myanmar Plans Special Gems Emporium for June

Myanmar will hold a special gems emporium in Yangon in June and July this year to encourage national gem traders to sell more quality gems, jade pearl and jewelry, according to the Central Committee for Holding Myanmar Gems Emporium. Without specifying the exact date, the gems show will take place at Myanmar Convention Center (MCC) based upon competitive bidding. Myanmar earned $504 million from the sale of nearly 7,000 jade lots and gems at a recent annual gems emporium held in March.


 
Confindustria Federorafi Joins RJC

The association Confindustria Federorafi, Italy's National Federation of Gold Jewellery, Silverware and Jewellery Manufacturers, joined the Responsible Jewellery Council (RJC). Confindustria Federorafi is associated with 800 manufacturing companies in Italy. Precious metals jewelry made in Italy amounts to 70 percent of European production. Each year in Italy 150 tons of fine gold, 1,000 tons of silver and four tons of platinum are processed. There are more than 10,000 companies operating in this sector, employing 40,000 people for production.


STATS  
 
India Apr. Imports & Exports

  Apr. '10   YTD '10  
  $Mil Chng. $Mil Chng.
Polished Exports $1,942 109% $6,820 81%
Polished Imports $1,251 115% $4,190 52%
Net Exports $692 99% $2,630 157%
         
Rough Imports $967 102% $3,700 202%
Rough Exports $79 57% $296 40%
Net Imports $888 107% $3,410 236%
         
Net Diamond Acct. ($196) -143% ($782) NA


MINING  
 
De Beers Publishes Annual 'Report to Society'

De Beers annual Report to Society for 2009 showed the company had no fatalities during 2009 for the first time in 80 years. This reflected the implementation of numerous targeted safety measures, which also helped to improve its lost time injury rate from 106.89 per 200,000 hours in 2008 to 6.52 in 2009.

In 2009, the use of potable and non-potable water at mining operations was reduced 41 percent as production declined, and recycled water use rose to 57 percent of total water footprint. Other highlights from the report included that De Beers provided anti–retroviral treatment to 1,820 employees and their partners in Botswana, Namibia and South Africa. The company paid $3.4 billion to stakeholders during the year, down from $6.2 billion in 2008. Its investment in community social initiatives totaled $29.3 million representing 9.2 percent of pre-tax profits.


 
Vaaldiam's Loss Grows 44%

Vaaldiam Mining reported a net loss of $2.3 million for the first quarter, compared with the loss of $1.6 million it posted one year ago. The mining company's cash on hand as of March 31, 2010 was $15.1 million and it held working capital of $10.4 million. Vaaldiam's quarterly statement concluded that diamond production at the Duas Barras property in Brazil would resume by the third quarter.


 
Petra Completes Kimberley Underground Deal

Petra Diamonds completed its acquisition of the Kimberley Underground asset, more than two years after agreeing to buy the mine for $10.4 million from De Beers. Petra has been operating Kimberley Underground under care and maintenance since September 2007, but said that processing and diamond recoveries will now commence at the mine. The company has built up a stockpile of approximately 500,000 tonnes of ore containing an estimated 90,000 carats of diamonds since signing the deal.


 
ALROSA Plans to Reinvest 2009 Profits

ALROSA’s advisory board could pay a modest dividend of RUB 916.30 per share, but for the bulk of 2009 profits the company board recommended that $62 million of 2009’s $76.5 million (RUB 2.348 billion) net profit be invested in the deep mines. Funds would cover exploration and other new investment areas that were presented as part of a three-year financial model, where ALROSA will mine 102.321 million carats of diamonds, targeting sales of $9.548 billion for the 2010 to 2012 period. ALROSA will invest $806 million in deep mines during that time.


ECONWATCH  
 
For the week ending May 20, 2010:

  May. 20 May. 13 Chng.  
$1 = Euro 0.810 0.796 0.014  
$1 = Rupee 46.86 45.03 1.8  
$1 = Israel Shekel 3.81 3.75 0.06  
$1 = Rand 7.66 7.47 0.19  
$1 = Canadian Dollar 1.05 1.02 0.03  
         
Precious Metals        
Gold $1,182.10 $1,232.90 -$50.80  
Platinum $1,515.00 $1,735.00 -$220.00  
         
Stock Indexes       Chng.
BSE 16,519.68 17,265.87 -746.19 -4.3%
Dow Jones 10,068.01 10,782.95 -714.94 -6.6%
FTSE 5,073.13 5,433.73 -360.60 -6.6%
Hang Seng 19,545.83 20,422.46 -876.63 -4.3%
S&P 500 1,071.59 1,157.43 -85.84 -7.4%
Yahoo! Jewelry 842.31 927.25 -84.94 -9.2%
         
USA        
Birks & Mayors $1.29 $1.53 -$0.24 -15.7%
Blue Nile $48.29 $51.66 -$3.37 -6.5%
Charles & Colvard $2.32 $2.49 -$0.17 -6.8%
DGSE Companies $3.09 $2.40 $0.69 28.8%
Fuqi Intl. $8.04 $10.11 -$2.07 -20.5%
JCPenney $26.16 $28.34 -$2.18 -7.7%
Kohl's $51.11 $54.01 -$2.90 -5.4%
LJ Intl. $2.47 $2.78 -$0.31 -11.2%
Macy's $20.44 $23.54 -$3.10 -13.2%
Man Sang $1.94 $2.00 -$0.06 -3.0%
Movado Group $11.27 $12.91 -$1.64 -12.7%
Nordstrom $37.47 $41.46 -$3.99 -9.6%
Saks $8.39 $9.48 -$1.09 -11.5%
Signet $30.51 $32.79 -$2.28 -7.0%
Sotheby's $29.70 $36.24 -$6.54 -18.0%
Tiffany $41.90 $46.58 -$4.68 -10.0%
Walmart $51.53 $52.57 -$1.04 -2.0%
Zale $2.40 $2.98 -$0.58 -19.5%
         
EUROPE        
Bulgari €6.00 €6.60 -€0.60 -9.1%
Bijou Brigitte €114.00 €121.30 -€7.30 -6.0%
Damiani €0.85 €0.87 -€0.02 -2.3%
LVMH €83.41 €91.65 -€8.24 -9.0%
PPR €96.41 €105.30 -€8.89 -8.4%
Richemont CHF 37.55 CHF 41.55 -CHF 4.00 -9.6%
Swatch Group CHF 298.80 CHF 333.20 -CHF 34.40 -10.3%
Theo Fennell (pence) 34.00 35.00 -1.00 -2.9%
         
INDIA (rupee)        
Classic Diamond 20.15 21.25 -1.10 -5.2%
Gitanjali Gems 98.60 112.20 -13.60 -12.1%
Goldiam Intl. 46.90 45.75 1.15 2.5%
Rajesh Exports 122.00 125.05 -3.05 -2.4%
Ren. Jewellery 85.05 86.35 -1.30 -1.5%
Su-Raj Diamonds 49.60 52.40 -2.80 -5.3%
Titan 2,245.75 2,241.35 4.40 0.2%
Zodiac JRD 27.05 31.00 -3.95 -12.7%
Suashish Diamonds 285.45 273.40 12.05 4.4%
         
NEW ZEALAND        
Michael Hill NZD 0.71 NZD 0.73 -NZD 0.02 -2.7%
         
MINING STOCKS        
CANADA        
Harry Winston CAD 11.63 CAD 12.72 -CAD 1.09 -8.6%
Lucara Diamond CAD 0.75 CAD 0.85 -CAD 0.10 -11.8%
Mountain Province CAD 2.35 CAD 2.45 -CAD 0.10 -4.1%
Peregrine Diamonds CAD 2.00 CAD 2.33 -CAD 0.33 -14.2%
Rockwell Diamonds CAD 0.07 CAD 0.07 CAD 0.00 0.0%
Shore Gold CAD 0.71 CAD 0.83 -CAD 0.12 -14.5%
Stornoway Diamond CAD 0.52 CAD 0.59 -CAD 0.07 -11.9%
True North Gems CAD 0.08 CAD 0.08 CAD 0.00 0.0%
UK (pence)        
African Diamonds 33.25 35.00 -1.8 -5.0%
Anglo American 2,416.00 2,751.00 -335.0 -12.2%
BHP Billiton 1,768.50 2,005.50 -237.0 -11.8%
Firestone Diamonds 36.00 38.25 -2.3 -5.9%
Gem Diamonds 252.00 284.00 -32.0 -11.3%
Gemfields 4.97 5.00 0.0 -0.6%
Mwana Africa 7.59 8.95 -1.4 -15.2%
Namakwa Diamonds 39.50 36.50 3.0 8.2%
Petra Diamonds 66.75 79.25 -12.5 -15.8%
Rio Tinto plc 2,812.00 3,360.58 -548.6 -16.3%
Stellar Diamonds 13.50 13.00 0.5 3.8%


INDIA MARKET REPORT  
 
Polished and rough trading activity

POLISHED: Trading activity slowing due to shortages of goods and a volatile dollar exchange rate. Many diamond dealers are on hoildays due to summer vacation.
Round
-1 point: Very Good demand: $150-$300 whites.
Good demand: +$300 whites.
-2 point: Good demand: $150-$300 whites.
Fair Demand: $350 whites & $250-$350 OWTTLC
2-7 point: Very Good demand: +$150-$300 whites.
Good demand: +$300 whites.
Fair Demand: $250-$350 OWTTLC
8-18 point: Good demand: -$400 whites.
Fair Demand: +$500 whites
20 points: Good demand: -$350 whites.
Fair demand: +$600 whites.
25 points: Good demand: -$350 & +$700 whites.
33 points: Good demand: $300 - $500 & +$850 whites.
50 points: Good demand: $500-$700 & +$1000 whites.
75 points: Good demand: $700-$900 & +$2000whites.
1 carat+: Very good demand: +$1000 whites.
Good demand: -$1000 whites.
Princess
-3 point: Fair demand: $200-$250 whites.
+3 point: Fair demand: $250-$300 whites.
+9-18 point: Fair demand: $250-$350 whites.
20 point: Fair demand: $700-$750 whites.
25 point: Fair demand: $800-$850 whites.
50 point: Fair demand: $400-$700 & $1600-$1,800 whites.
75 point: Fair demand: $800-$1,200 whites.
1 carat+: Good demand: +$2,500 whites.
Fair demand: $1000-$2000 whites
Marquise
-6 point: Fair demand: $250-$350 whites.
+7-18 point: Good demand: $250-$400 whites.
20 point: Fair demand: $250-$400 & $900-$1,000 whites.
25 point: Fair demand: $250-$400 & $1,100-$1,200 whites.
33 point: Fair demand: $250-$400 & $1,300-$1,500 whites.
50 point: Fair demand: $1,600-$1,800 whites.
75 point: Fair demand: $2,600-$2,800 whites.
1 carat+: Good demand: $300-$600 & +$1,000 whites.
Tapers & Baguettes
Good demand: $600-$800 +5mm whites. $250-$325
2mm-2.5mm whites; $350-$400, 2.5mm-3mm whites;
             $400-$450 3mm-4mm, $500-$600 4mm –
             5mm & $175-$250 +2mm-3mm whites.
ROUGH: Local rough market is slow due to some local holidays (Jain festival). Summer vacation started as people prepare for marriage season.
1-5 point: Good demand: $85-$125 makeables; $95-$195 crystals.
$45-$75 makeables.
Fair demand: $7-$20 & $45-$90 OW TTLB & TTLC.
6-20 point: Very Good demand: $150-220 crystals; $100-$180 makeables.
Good demand: $60-$110 fancy shapes; $45-$75clivage.
Fair demand: $50-$90 OW TTLC & TTLB rounds.
21-50 point: Very Good demand: $190-270 makeables;
$110-$200 & $220-$290 crystals.
Good demand: $80-$190 fancy shapes;
$95-$200 rounds; $50- $90 clivage.
Fair demand $20-$40 OW TTLC & TTLB.
0.51-1.00 carat: Very Good demand: $170-$330 makeables;
$120-$250 & $280-$460 crystals.
Good demand: $80-$120 makeables;
$90-$200 fancy shapes; $55-$110 clivage.
Fair demand $60-$90 OW TTLC & TTLB.
1.01-2.00 carat: Very Good demand: $230-$580 rounds; $280-$735 crystals.
Good demand: $90-$120 clivage; $190-$370 all fancy shapes.
Fair demand: $140-$180 OW TTLC & TTLB.
2.01-3.00 carat: Good demand: $250-$1,000 makeables; $350-$1,300 crystals;
$400-$800 fancy shapes; $210-$300 clivage.
Fair demand: $100-$325 flats & TTLC & TTLB
$350-$800 OW.
5.00 carat+:  Good demand: $1,000+ makeables, crystals & all fancy shapes till L color.
Mixed Lot: Good demand: $2-$40.





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Tags: African Diamonds, Alrosa, Anglo American, Auctions, BHP Billiton, Bidz.com, Bulgari, CIBJO, Consumers, Damas, De Beers, DTC, Dubai, Fair Trade, Firestone, Gem Diamonds, GIA, Government, Harry Winston, ICSC, India, Israel, JCK, Jewelry, Lucara Diamond, LVMH, Manufacturing, Michael Hill, Movado, Myanmar, Namibia, Petra Diamonds, Production, Responsible Jewellery Council, Richemont, Rio Tinto, RJC, Rockwell, Signet, Sotheby's, South Africa, Stellar Diamonds, Theo Fennell, Tiffany, Titan, Zale, Zimbabwe
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