WORLD OF JEWELRY ISSUE 5

WORLD OF JEWELRY

WOJ

JANUARY 2020

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Industry Richemont Acquires Buccelatti Show IJS Hosted 20.172 Visitors From 127 Countries

Cover image; Harry Winston

WORLD OF JEWELRY

Industry LVMH Reaches Agreement with Tiffany & Co.

TIMELESS ELEGANCE Altın Dünyası

CONFERENCE

SHOW

RESEARCH

ASEAN GEMS & JEWELLERY ASSOCIATION CONFERENCE WAS HELD IN ISTANBUL

HOLIDAY CONCEPT JEWELRY SHOW ''JEWELLERY ANTALYA''

2019 GLOBAL DIAMOND INDUSTRY REPORT; STRONG ORIGINS

ASEAN Conference Held For The First Time in Istanbul Mustafa KAMAR Chairman Jewellery Exporters' Association of Turkey

While the jewellery industry in Turkey increases the export on one hand, it has started to take more effective tasks in global sectoral institutions.

This year, ASEAN Gems and Jewellery Association Conference was held in İstanbul. Turkey as the bridge between east and west has successfully hosted this important organisation. We have hosted various sectoral presidents of assosiations and the most important buyers around the world in İstanbul.

We hope that our cooperation in this conference will continue to increase its strength in the future.

First holiday concept jewellery fair; ''Jewellery Antalya'' İstanbul Jewellery Show that is organised in March and September is among the most important organisations in the global jewellery industry agenda. We are planning to add a new one to 2 important fairs. We will organise a new event in Antalya, one of the most beautiful holiday regions in Turkey and around the world. “Jewellery Antalya” will be held between 3-7 January 2020. 300 jewellery firms from Europe and Russia will participate in the first organisation. Firms that attend to this fair with holiday concept will have the chance to meet the 54 largest exporter firms in Turkey and to view the latest collections. This fair will follow the “Cash and Carry” system. With this organisation, we want to help jewellery firms to complete their Valentine’s Day and International Women’s Day preparations.

Get ready for your İstanbul Jewellery Show randezvous.

As in all previous years, we will welcome buyers from all over the world in İstanbul Jewellery Show on March 2020. In March, we plan to cover the accommodation expenses of approximately 2000 jewellery firms.

I hope a dazzling new year in 2020 like a dazzling diamond. Happy New Year.

WOJ WORLD OF JEWELRY worldofjewelry.net JEWELLERY EXPORTERS' ASSOCIATION

PUBLISHER Altın Dünyası Publishing Group EDITOR IN CHIEF Remzi ÇELEN remzi@altindunyasi.org MANAGING EDITOR Aslı ÇELEBİOĞLU asli@altindunyasi.org

DESIGNER Mert CAN mert@altindunyasidergisi.com COORDINATOR Nur KUŞKONDURMAZ Tel: +90531 657 32 93 nur@altindunyasidergisi.com ADVERTISING Aysegul ELGİN Tel: +90536 935 58 56 aysegul@altindunyasidergisi.com ADVERTISING Esin ÇALIŞKAN Tel: +90543 975 21 15 esin@altindunyasidergisi.com ADVERTISING Serap KARAKOÇ Tel: +90533 319 48 59 serap@altindunyasidergisi.com JEWELLERY EXPORTERS' ASSOCIATION OF TURKEY Dış Ticaret Kompleksi A-Blok K:2 Çobançeşme Mevkii, Sanayi Cad. Yenibosna-Bahçelievler İstanbul / Türkiye Tel: +90 212 454 00 00 I:1002 Fax: +90 212 454 00 32 YAYIN DÜNYASI YAYINCILIK GAZETECİLİK VE DAĞITIM A.Ş.

Klodfarer Cad. Kültür Apt. N:15 Kat:2 N:10 Sultanahmet - Fatih - İstanbul / Türkiye Tel: +90 212 518 84 01 GSM: +90533 556 03 22 PRINTING / 1 EYLÜL OFSET M.Nezih Özmen Mah. M.Akif Cad. Kestane Sok. No:5/3 Kat:4 Merter / İstanbul Tel : +90212 555 19 03

ISSUE 5 / JANUARY 2020

5CONTENTS

ISSUE

ART DIRECTOR Süleyman ÖNKOYUN suleyman@altindunyasidergisi.com

06 HARRY WINSTON; ''TIMELESS ELEGANCE'' 08 A GEMSTONE THE COLOUR OF THE MORNING SKY : TURQUOISE 12 CHRISTIE’S LAUNCHING NEW PUBLISHING INITIATIVE IN 2020 14 MOUAWAD UNVEILS $5 MILLION MISS UNIVERSE DIAMOND CROWN 16 NOT JUST ANOTHER CRUSH: CHANEL’S COCO CRUSH COLLECTION 18 DIAMOND PRINCESS BY ROBERTO COIN 20 BLACK ORCHID BY ROBERTO BRAVO 22 THE PETIT GARDEN COLLCTION 24 REGOLD : TRENDY COLLECTION 26 LVMH REACHES AGREEMENT WITH TIFFANY & CO. 30 RICHEMONT ACQUIRES BUCCELLATI 32 HOLIDAY CONCEPT JEWELERY FAIR ‘‘JEWELLERY ANTALYA’’ 34 8TH ASEAN CONFERENCE HELD FOR THE FIRST TIME IN ISTANBUL 38 ZEN DIAMOND HAS OPENED ITS 3RD STORE IN GERMANY 44 BOOK FOR TO THE MARCH EDITION OF IJS 46 #PRIMAVICENZAORO 48 ROBERTO BRAVO OPENED A NEW STORE IN CHINA 54 JEWELERS OF AMERICA REACHES MILLIONS WITH CONSUMER MARKETING 60 HRD ANTWERP APPOINTS NEW CEO 66 BAIN & CO, AWDC UNVEIL 2019 GLOBAL DIAMOND INDUSTRY REPORT 82 WORLD GOLD COUNCIL GOLD DEMAND TRENDS

Timeless Elegance Harry Winston (March 1, 1896 – December 8, 1978) was an American jeweler. He donated the Hope Diamond to the Smithsonian Institution in 1958 after owning it for a decade.[2] He also traded the Portuguese Diamond to the Smithsonian in 1963.

Winston founded the Harry Winston Inc. in New York City in 1932. He had been called by

many as the “King of Diamonds” Winston’s father Jacob started a small jewelry business after he and his mother immigrated to the United States from Ukraine.

While growing up, he worked in his father’s shop. When he was twelve years old, he recognized a two-carat emerald in a pawn shop, bought it for 25 cents, and sold it two days later for $800.

Winston started his business

in 1920 and opened his first store in New York City in 1932.

Winston’s jewelry empire began in 1926, with his acquisition of Arabella Huntington’s jewelry collection, for $1.2 million. The wife of railroad magnate Henry E. Huntington, Arabella amassed one of the world’s most prestigious collections of jewelry, largely from Parisian jewelers such as Cartier. When Winston bought the collection after her death, the designs of the jewelry in the collection were quite old fashioned. Winston redesigned the jewelry into more contemporary styles and showcased his unique skill at jewelry crafting.

When he died, Winston left the company to his two sons, Ronald and Bruce, who then entered into a decade-long battle over the control of the company. In 2000, Ronald along with new business partner, Fenway Partners, bought Bruce out from the company for $54.1 million.

Winston was among the most noted jewelers in the world, well-known to the general public. In the 1953 musical film Gentlemen Prefer Blondes, the song “Diamonds Are a Girl’s Best Friend” includes the spoken interjection “Talk to me, Harry Winston, tell me all about it!” The Lauren Weisberger comic novel, Chasing Harry Winston, was published in May 2008.[17] In 2015, Harry Winston, Inc. operated 39 salons and numerous retail affiliates in locations such as New York, Beverly Hills, Las Vegas, Dallas, Honolulu, Bal Harbour, Chicago, Costa Mesa, and other countries around the world.

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KATERINA PEREZ, ONE OF THE WORLD’S BEST KNOWN JEWELERY EXPERT, HAS PUBLISHED AN ARTICLE ABOUT TURQUOISE STONES ON HER WEBSITE.

A GEMSTONE THE COLOUR OF THE MORNING SKY

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he talisman of lords, a symbol of good luck, a protecting stone, a love amulet – legend has it that all these can be attributed to turquoise. Its significance is increased if you were born in December: those whose birthday falls in the last month of the year are afforded special protection by this stone that boasts the colour of the morning sky.

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Check out the article on katerinaperez.com

TURQUOISE

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Boghossian Art of Inlay necklace with sapphires inlaid in turquoise and further embellished with diamonds

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Bvlgari Serpenti Secret Watch with Chaumet Les Mondes de 18 kt rose gold head set with bril- Chaumet Talismania bracelet liant cut diamonds and turquoise eyes, 18 kt rose gold case, 18 kt in ebony and turquoise set in yellow gold rose gold dial and double spiral bracelet, both set with brilliant cut diamonds and turquoises

ntil recently, the jewellery industry saw turquoise as an inexpensive material that could be framed in silver. It was in this form that the stone with its amazing colour would find itself in the jewellery boxes of young ladies. But the latest trends - which paved the way for this admittedly affordable but enchanting gemstone to make its way into high jewellery collections - have taken turquoise to a whole new level.

In the last year alone, it has become part of collections at Bulgari, Harry Winston, Louis Vuitton, Mellerio Dits Meller, Suzanne Syz, Veschetti, David Yurman and many other famous brands.

This appears to be something of an unprecedented elevation for such an unpretentious stone, but no!

Turquoise has for time immemorial been accustomed to royal environments, both in the literal and figurative sense. In the 16th century for example, Persian craftsmen made the throne presented to Boris Godunov

by Shah Abbas I from hammered gold with a floral pattern that was richly decorated with rubies, pearls and turquoise.

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Chopard RIHANNA CHOPARD Harry Winston Winston Candy earrings ring with 1 oval-shaped pink tourmaline weighing a total of 11.22 carats, pink sapphires and turquoise

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urquoise also adorns the throne that originally belonged to Ivan the Terrible, and then to Mikhail Romanov. Here, inlays made with the blue mineral are accentuated by tourmalines, chrysolites, pearls and two large topazes. It is not surprising that turquoise became world-famous thanks to the generous gifts of eastern rulers, as its first deposits were found in modern-day Iran.

Now turquoise is also mined in the USA (Arizona), Mexico, Mongolia, Afghanistan, China, Israel, Kazakhstan, Uzbekistan and the Sinai Peninsula.

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Turquoise certainly was not chosen to be a December birthstone by chance. It can be damaged by fats, oils and alcohol solutions, heat or direct sunlight - but with the help of water it adopts a more intense colour. There is often not enough blue sky in winter, and so a jewel with this particular colour will invariably invoke pleasant associations for both its owner and for those around them!

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Piaget Extremely Piaget Van Cleef & Arpels Perlée “Sunlight” ring in turquoise with Couleurs transformable long a central tanzanite necklace with turquoise set in yellow gold

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David Webb Shangri-La neGlenn Spiro Turquoise cklace with carved emeralds, Ceramic bangle in 18K yellow oval cabochon turquoise, brilgold set with 16 Antique liant-cut diamonds, polished turquoise beads weighing 18K gold, and platinum 393.53 cts, moonstones and diamonds

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Van Cleef & Arpels Lady Arpels Martin-Pêcheur Azur watch with turquoise, lapis lazuli and diamonds

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KATERINA PEREZ Jewellery insider Katerina Perez is a specialist with professional knowledge and insight of the industry. Since training as a gemmologist at The Gemmological Association of Great Britain (Gem-A), Russian-born London-based Katerina has worked as a freelance journalist and content editor since 2011. She has written articles in both English and Russian for VO+, Robb Report and Kommersant, amongst others. Since founding her website in 2013, Katerina has championed the work of talented jewellers across the globe, from established brands to fledgling designers whom she has personally scouted.

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de GRISOGONO Mediterranean necklace with turquoise, sapphires and diamonds

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Pomellato Pomellato Armonie Minerali ring with lapis lazuli, chrysocolla and emeralds

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Tiffany&Co. Turquoise and rubellite ring

Katerina’s mark on the industry has so far been recognised in her appointment as a judge on the panel for one of the world’s most renowned jewellery competitions (Couture, Las Vegas), as well as her invitations to give educational talks by The Gemological Institute of America (GIA) and hold seminars at International Jewellery London (IJL), rated as the fair’s top events for 3 consecutive years running. In March 2017, Katerina helped raised funds for Action for Children, offering a jewellery consultation as a lot in their charity auction.

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Ming Lampson Turquoise Flower Drop earrings with turquoise drops, tsavorites and sapphires

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de GRISOGONO Mediterranean collection ring with 18 cts turquoise, sapphires, amethysts and diamonds

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CHRISTIE’S

LAUNCHING NEW PUBLISHING INITIATIVE IN 2020

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hristie’s is launching a new publishing initiative to significantly reduce print materials. The initial focus will be on the continued evolution of catalogue production and circulation with a goal of 50% reduction in print over the course of 2020.

The reduction will be paired with increased investment in digital capabilities and experiences – from immersive property presentation to transactional experiences.

“Nearly all Christie’s global client base are now digitally engaged on a transactional basis with a complete collecting experience online. From engaging

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general content to our detailed catalogues, bidder registration and post-sale processes, all can be accessed via screens of choice. While recognising broader efforts are required to continue to address our overall environmental impact, this initiative provides the opportunity to significantly reduce print materials and the associated distribution impact.

It is now not only possible but essential,” commented Guillaume Cerutti, Chief Executive Officer, Christie’s International.

Existing client behaviour underpins this shift with over 52% of all lots acquired at Christie’s already being purchased

by clients who did not receive any print materials. The project is rooted in Christie’s commitment to a more sustainable future. Already underway at Christie’s is an ongoing, iterative Sustainability program. This programme covers efforts to procure energy from renewable sources, including implementing energy reduction initiatives throughout buildings globally, assessing travel of staff and artworks, and reviewing the production of materials and recycling to minimize waste. “As a priority in 2020, we will continue to look at all aspects of our business to identify where we can reduce environmental impact” concluded Mr. Cerutti.

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Mouawad Unveils $5 Million Miss Universe Diamond Crown Sightholder Mouawad has unveiled the $5 million crown created for the Miss Universe competition.

The 18-karat gold creation, called The Miss Universe Power of Unity Crown, is set with over 1,770 white diamonds. The headpiece also features three yellow diamonds from Botswana including a 62.83-carat shield-cut canary yellow stone at its center.

Through its partnership with The Miss Universe Organization, Mouwad will also craft crowns for the MISS USA and MISS TEEN USA pageants. The winners of these competitions will receive a keepsake tiara from Mouawad.

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Quilted motif bangle in 18K BEIGE GOLD and diamonds Ref. J11763 $9,800

NOT JUST ANOTHER CRUSH: CHANEL’S COCO CRUSH COLLECTION Whether you’re a maximalist or a minimalist, Chanel’s Coco Crush collection lets your express your unique personality freely

Just as Coco Chanel fearlessly revolutionised the way women dress and style themselves, that same spirit is reflected in everything the House of Chanel creates. Four years since the debut of its fine jewellery collection, Coco Crush, we still can’t stop crushing on the quilted-motif pieces, from the delicate chain necklace to the chunky diamond-studded ring.

Nail the art of minimalism with Coco Crush by letting each individual piece shine. Going minimalist doesn’t have to mean being boring, Jazz up a statement jacket (like the metallic leather jacket above) with classic jewellery, or pair the timeless pieces with everyday denim for an effortless vibe.

And as we prep ourselves (and our wardrobes) for the upcoming New Year’s celebrations— not to mention Chinese New Year right up ahead—it’s time to embrace the season’s festivities and have fun with Coco Crush.

Complement your party outfits by piling on ring upon ring (yes, on the same finger) and layer a yellow gold bracelet with a white gold one. There’s no better excuse to go over the top and be bold with your maximalist look!

Whether you’re all about more-is-more or prefer to keep it simple, Chanel’s Coco Crush collection is definitely a staple in every jewellery arsenal.

The Chanel Coco Crush collection is available at Chanel Fine Jewellery Boutique and Chanel Fashion Boutiques.

Quilted motif bangle in 18K BEIGE GOLD and diamonds Ref. J11666 $5,200

Quilted motif bangle in 18K yellow gold Ref. J11663 $4,200

Quilted motif ring, medium version, in 18K yellow gold Ref. J10574 $3,300

Quilted motif earrings in 18K BEIGE GOLD and diamonds Clip-on earrings with removable posts for both pierced and non-pierced ears Ref. J11755 $4,800

Quilted motif ring, small version, in 18K BEIGE GOLD and diamonds Ref. J11101 $4,500

Quilted motif ring, medium version, in 18K white gold, all diamond paved Ref. J10955 $19,500

Quilted motif two-finger ring in 18K white and yellow gold and diamonds Ref. J11655 $6,300

Quilted motif earrings in 18K BEIGE GOLD Clip-on earrings with removable posts for both pierced and non-pierced ears Ref. J11754 $3,300

Diamond Princess

by Roberto Coin This Christmas, the romanticism of the new collection devoted to princesses and their diamonds is truly stunning. Diamond Princess is the latest addition to Roberto Coin’s Princess line, a world that took the classic dream of becoming a princess and made it modern again. The princess that wears this collection doesn’t need pomposity to revolutionize traditional beauty standards.

The pieces in the collection are symbols of romanticism reinterpreted in a contemporary ultra-feminine look, without the dust of the past.

The flower design evokes all the delicateness of sensuality and the scent of innocence that only dreamers possess. This is the look of the princesses walking down this year’s Christmas-lit streets.

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Black Orchid

by Roberto Bravo Orchidelirium is the name given to the Victorian era of flower madness when collecting and discovering orchids reached extraordinaily high levels.

Wealthy orchid fanatics of the 19th century sent explorers and collectors to almost every part of the World in search of new varities of orchids.

Orchids are considered symbols of love because of the fact that the plants grow easily and bloom under most conditions. During the Victorian era, it was a custom to gift exotic and rare flowers to Show love and affection.

It was even believed that rarer the flower you chose as a gift, deeper was your love. In parts of Europe, orchids were used as a key ingredient in love potions. Black Orchids symbolize admiration, respect, dignity and royalty.

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Petit Garden Collection

By Pasquale Bruni The spirituality of the island of Bali, the wonderful nature of the Hawaii islands with their mighty ocean and lush views: the Petit Garden line is born from these warm suggestions -small secrets of pure passion.

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www.premierjwlry.com Kuyumcukent Atölye Bloğu 1. Kat 5. Sokak No: 20/21 Yenibosna / Bahçelievler / İSTANBUL / TÜRKİYE premierjewelrytr Tel: +90 212 444 0 995

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Trendy jewels

by Regold Regold Stylish Gold, one of the leading brands in the jewelery sector, will enable women to achieve perfect elegance with their new products.

The tradition of craftsmanship, unique designs and original pieces of jewelry has always been the passion of women.

This passion creates a different dimension with Regold jewelry.

Regold Stylish Gold reveals the changes that surround the heart of the woman who carries the jewel, the subtlety, the harmony with the fashion and the original designs.

Designed with precious stones coming from the depths of nature, the products of design and craftsmanship make people look flawless and complete. It guides you in recognizing and finding the uniqueness you want.

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LVMH REACHES AGREEMENT WITH TIFFANY & CO.

LVMH Moët Hennessy Louis Vuitton SE (“LVMH”), the world’s leading luxury group and Tiffany & Co. (NYSE: TIF) (“Tiffany”), the global luxury jeweler, announced that the companies have entered into a definitive agreement whereby LVMH will acquire Tiffany for $135 per share in cash, in a transaction with an equity value of approximately €14.7 billion or $16.2 billion.

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or more than 180 years, Tiffany has been synonymous with elegance, innovative design, fine craftsmanship and creative excellence. Since 1886, when it established the eponymous diamond ring as an enduring symbol of commitment, Tiffany has stood for love. Its extraordinary diamonds are cherished for generations and its legendary jewelry designs are the ultimate reference in the global jewelry world. Even the Tiffany Blue Box is recognized worldwide as an icon of refinement and desirability.

Founded in 1837 when Charles Lewis Tiffany opened the first store in downtown Manhattan, Tiffany today is the leading luxury brand originated in the United States and delights discerning customers in more than 300 stores around the globe. Nature is not only the source of inspiration for Tiffany’s designers, but precious metals and natural gemstones are necessary components for the creation of its designs.

Tiffany stood apart in the industry as an early proponent of sourcing these materials with a socially and environmentally responsible rigor.

Protecting the environment and respecting human rights continue to be core business principles.

The acquisition of Tiffany will strengthen LVMH’s position in jewelry and further increase its

presence in the United States. The addition of Tiffany will transform LVMH’s Watches & Jewelry division and complement LVMH’s 75 distinguished Houses.

We are delighted to have the opportunity to welcome Tiffany, a company with an unparalleled heritage and unique position in the global jewelry world, to the LVMH family.

Bernard Arnault Chairman of LVMH

Bernard Arnault, Chairman and Chief Executive Officer of LVMH, commented: “We are delighted to have the opportunity to welcome Tiffany, a company with an unparalleled heritage and unique position in the global jewelry world, to the LVMH family. We have an immense respect and admiration for Tiffany and intend to develop this jewel with the same dedication and commitment that we have applied to each and every one of our Maisons. We will be proud to have Tiffany sit alongside our iconic brands and look forward to ensuring that Tiffany continues to thrive for centuries to come.”

Roger N. Farah, Chairman of the Board of Directors of Tiffany, commented, “Following a strategic review that included a thoughtful internal process and expert external advice, the Board has concluded that this transaction with LVMH provides an exciting path forward with a group that appreciates and will invest in Tiffany’s unique assets and strong human capital, while delivering a compelling price with value certainty to our shareholders.”

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Art Deco Cartier Necklace Triples Estimate at Bonhams’ London Jewels Sale

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n Art Deco aquamarine and diamond necklace by Cartier, dated circa 1940, sold for £459,062 (approx. $601,399) including premium, at Bonhams’ London Jewels sale, tripling its pre-sale estimate of £100,000 - 150,000 (est. high of $197,440). The auction house says that the highly articulated geometric necklace, set with nearly 170 carats of beautifully matched aquamarines, was an impeccable example of Cartier’s late Art Deco style and sparked an international bidding war.

The necklace headlined headlined the selection of Art Deco jewelry and timepieces from the most coveted jewellery houses - including Cartier and Lacloche Frères.

The Cartier Art Deco Aquamarine and Diamond necklace is described as “a perfect example of Cartier’s late Art Deco style, for which the French jeweler is internationally recognised.” Emily Barber, Bonhams UK Jewelry Director, says: “From the 1930s Cartier used aquamarines in their designs. This necklace is a magnificent example of how the Maison elevated the transparent pale-blue gem to the forefront of contemporary high jewelry design.”

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Richemont acquires Buccellati Richemont is pleased to announce that it has acquired 100% of Buccellati Holding Italia S.p.A., the owner of Buccellati, the renowned Italian jewellery Maison, in a private transaction with Gangtai Group Corporation Limited, a privately held conglomerate, which captures the growth in the consumer, culture, finance, and health industries.

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uccellati was founded in Milan in 1919 by Mr Mario Buccellati. The Maison has a rich history and patrimony, distinguished by exceptional craftsmanship and unique know-how. Its jewellery creations are renowned for their highly distinctive look-and-feel evoking silk, damask, tulle and linen. All jewellery pieces are handcrafted with techniques dating back to the Renaissance, in Buccellati’s four in-house workshops, all located in Italy. Buccellati is also active in the fields of watchmaking and silverware.

Mr Xu Jiangang, founder and Chairman of Gangtai Group, commented: “We are extremely glad to have successfully contributed to the introduction of the prestigious Buccellati brand in the Greater China market, strengthening Buccellati’s identity and enhancing all of the elements which make it one of the best-known brands worldwide in the fine jewellery sector. We are now honoured and proud that Richemont will continue the journey, ensuring Buccellati’s great success, starting from the celebration of its 100th Anniversary.”

Commenting on the acquisition, Mr Johann Rupert, Chairman of Richemont, said: “Distinguished by strong heritage, craftsmanship and family spirit, Buccellati is one of the few Maisons in the dynamic branded jewellery market which is complementary to our existing jewellery Maisons, in terms of style, origins and craftsmanship.

Buccellati meets the needs of today’s customers who are looking for creative jewellery, with a highly distinctive style.

Mr Andrea Buccellati, Honorary Chairman and Creative Director of Buccellati, said: “We are proud to join Richemont, a family-spirited Group and nurturer of prestigious luxury Maisons, with an undisputed expertise in jewellery. We value their long term strategic thinking and look forward to seeing the potential of Buccellati realised as part of Richemont.”

We welcome Andrea Buccellati, his family and his team. With them, we share a culture of constant quest for creativity, innovation, quality and excellence. We look forward to ensuring the long term development of this unique jewellery Maison.”

The transaction closed on 26 September 2019 and will have no material financial impact on Richemont’s consolidated net assets or operating result for the year ending 31 March 2020. The results of Buccellati will be reported under the Jewellery Maisons business area.

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HOLIDAY CONCEPT JEWELERY FAIR

‘‘JEWELLERY ANTALYA’’ The largest 300 jewellery companies from Europe and Russia will meet in Antalya. In ‘’Jewellery Antalya’’ organised by Jewellery Exporters’ Association of Turkey, buyers will meet with Turkey’s most important exporter companies. The organisation will be held between 03-07 January 2020 in Antalya Rixos Sungate Premium Hotel.

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he president of The Jewellery Exporters’ Association of Turkey, Mustafa Kamar, expressed his views about the organization of ‘’ Jewellery Antalya ‘’.

Kamar said, ‘’ 300 jewellery buyers have already booked their places.

We want our relationship with B2B procurement delegations to be entirely based on holiday concept.

By introducing tourism, we will bring the world’s largest buyers to our country. Our aim is to organize the world’s first fair in this field for buyers who have completed their

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Christmas sales and preparing their stocks for 14th February Valentine’s Day and 8th March International Women’s Day. We want the jewellers from Russia and Europe come to Antalya on Christmas holidays. We want them to spend their holidays here and develop their B2B relationship with us. In this fair, we will implement the ’Cash and Cary’ system. We have completed the technical preparations on this subject. Buyers will be able to buy the products

they have selected at this fair. Our guests will be able to complete their preparations for Valentine’s Day and International Women’s Day. In ‘’Jewellery Antalya’’ organizations, more than 300 of our guest will meet Turkey’s 54 most important exporte companies and buyers will be able to look at the latest collections of our manufacturers. We will also welcome our guests from Antalya in our Istanbul Jewellery Show which will be held in March.’’

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8TH ASEAN CONFERENCE HELD FOR THE FIRST TIME IN ISTANBUL

Known as the G20 of the jewellery world, the Association of Southeast Asian Nations (ASEAN), is holding its eighth Gems and Jewellery Association Conference in Istanbul for the first time this year.

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he Jewellery Exporters’ Association, with the support of Turkey Promotion Group, hosted the 8th ASEAN (Association of Southeast Asian Nations) Countries Gems and Jewellery Association Conference in Istanbul for the first time.

With over 100 delegates from 37 Southeast Asian countries, including Brunei, Cambodia, Laos, Malaysia, Myanmar, Philippines, Thailand and Vietnam, the opening

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speeches of the 8th ASEAN Conference were delivered by the Deputy Minister of Trade of the Turkish Republic, Rıza Tuna Turagay; Turkish Exporters’ Assembly Chairman Ismail Gülle; ASEAN Gems and Jewellery Association Head Suttipong Damrongsakul; and Jewellery Exporters ‘ Association Chairman Mustafa Kamar.

“G20 of Jewellery gathers in Istanbul” Stating that the east and west have for the first

time become such close thanks to the meeting of the jewellery sector association in Istanbul, a bridge between the two continents, the Chairman of the Board of Directors of the Jewellery Exporters’ Association Mustafa Kamar asked why a modern Silk Road could not have been built between countries as he underlined the importance they attach to the ASEAN Conference. ”During the conference we will review the existing relations among the G20

countries of Jewellery and set off to build new collaborations,” said Mustafa Kamar adding: “With a population of about 80 million, GDP of USD 784 billion and export volume of USD 168 billion, Turkey is the only real bridge between East and West, which boasts a population of 1.2 billion and GDPof USD 24 trillion... Our country is one of the strongest players in the world with nearly 35 thousand retail jewelers, 6 thousand manufacturers, about 1000 exporters, and

2 refinaries who are members of the LBMA, which only has 64 such members in the world. Today, we are one of the 5 largest markets in the world jewellery sector together with India, China, USA and Russia, one of the 3 largest producers together with India and China, and 3 largest countries exporting its production together with Italy and China. Last year, our country recorded a 36% increase in jewelllery exports reaching USD 4.4 billion with USD 2.5 billion exports within the scope of the outward processing regime and USD 3.5 billion in tourism exports. We organized visits to Vicenza, Hong Kong, Moscow, Dubai, and United States jewellery fairs, as well as visits to Saudi Arabia, Qatar and Miami; and are working hard to achieve our goals through excellent B2Bs.”

in effect with all countries, trade should be facilitated with gold replacing money” ”Having a limited say and trade volume in the jewellery sector is upsetting for us, “ said Kamar adding, “ 37 participant countries in the conference achieve USD 88.5 billion in imports and USD 111 billion in exports of jewellery. The ASEAN countries, where nearly 650 million people live, have a jewellery import of USD 4.1 billion, while only about USD 45 million is bought from Turkey.

To increase our exports from Turkey, we need to explain the contents of the difficult FTA agreements to our bureaucracy. We can create a doping effect in the foreign markets by solving high import duties, and in the domestic market by taxing only labour.

One of the most important issues of our sector, Outward and Inward Processing Regimes, should be implemented with all

”

“Inward and outward processing regimes should be

Our country is one of the strongest players in the world with nearly 35 thousand retail jewelers, 6 thousand manufacturers, about 1000 exporters and 2 refinaries who are members of the LBMA, which only has 64 such members in the world.

Mustafa Kamar Jewellery Exporters’ Association of Turkey / Chairman

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countries. In addition to this, we can take a big step forward in Swift transactions, used as a trump card in trade wars, by facilitating trade with gold, by now a currency substitute, which can also be used as a trading tool. We should raise awareness about the jewellery sector through cooperating with governments on all these issues, and start working as soon as possible to regulate the issues raised through establishing commissions.”

Suttipong Damrongsakul: “Our Efforts Will Lead to the Development of Stronger Jewellery Markets” Suttipong Damrongsakul, Chairman of the Board of Directors of the ASEAN Gems and Jewellery Association, began his speech by saying: “Thanks to the strong unity among our members from 36

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the Gems and Jewelry Associations, the ASEAN Association is now officially established.”

Suttipong Damrongsakul further said: “With these projects, we believe that greater collaboration will take place among gems and jewelry associations, producers, makers, suppliers, distributors and retailers in the ASEAN region and beyond. Our determination and efforts to achieve this goal will lead to the development of stronger jewelry markets in ASEAN and non-ASEAN countries in the near future.”

Ernest Blom, Behnar Karaşen and Prof. Dr. Emre Alkin make their marks at the Conference Following the opening speeches of the conference, Ernest Blom, President of the World Federation of Diamond Bourses,

gave a speech on “Lab Grown Diamonds, Natural Diamonds, International Diamond Trade and the Role of WFDB in this Trade.” This was followed by the speech of Behnar Karashen, Director of International Projects at the Rare Metal Refinery.

Prof. Dr. Emre Alkin, Academician, Economist and Author, gave a presentation on ”Trade Wars, Expectations, and the Future of Economy”. ”Marketing Strategies For New Generation” discussed in the First Panel As part of the conference, Celine Lau, Informa Markets Director of Jewellery Fairs, gave a brief speech, followed by the panel on “Marketing Strategies for New Generation,” moderated

by Ya’akov Almor, Editorin-Chief of Idex-World Diamond Magazine.

“Easy Trade, Trade Wars,

Free Trade Agreements” the subject of the Second Panel.

What followed next in the conference were the speeches of Aycan Karagöz, Atty. of the Rare Metal Refinery, and Rashad Abelson, OECD Legal Expert on “Responsible Gold Supply.” The next panel was on “Easy Trade, Trade Wars, Free Trade Agreements,” moderated by Mia Florencio, AGJA Board Member and President of Guild of Philippine Jewellers Inc. The 8th ASEAN Conference came to an end with assessments by Suttipong Damrongsakul, Chairman of the Board of Directors of AGJA; and Mustafa Kamar, Chairman of the Jewellery Exporters’ Association on issues addressed earlier in the day.

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ZEN DIAMOND HAS OPENED ITS 3RD STORE IN GERMANY Zen Diamond, the leader in diamond jewellery, has expanded its international store networked and opened the 3rd store in Germany in Hamburg.

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In this last 3 years, Zen has been rapidly expanding abroad as it opened stores in Düsseldorf, Cologne and later in Hamburg. Other international stores are in Dubai, Abu Dhabi, Kuwait, TRNC and New York, US. Zen Diamond stores aim to provide the Zen shopping experience to the guests by enabling them to discover hundreds of design in a warm and elegant environment. In addition to various diamond jewellery models in different styles including modern or classical design, there are designs where diamond and colourful valuable stones are combined.

Zen Diamond has the largest diamond jewellery factory in Europe and the Middle East. Diamonds as the dream of every woman turn into a piece of jewellery at the skilful hands of Zen craftsman.

In addition to its expertise in production and wholesales, Zen Diamond started its operations in retail in 2005 and today, the brand has reached a store chain that expands with 80 stores from its own country to America, Gulf countries and Europe. Zen Diamond designs are also sold to the entire world from wholesale sales offices in New York, Düsseldorf and Dubai. Zen Diamond has completed the highest export between 2008-2015 and on 2018 in diamond jewellery and awarded by İstanbul Minerals and Metal Exporters’ Association.

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ISTANBUL JEWELRY SHOW HOSTED 20.172 VISITORS FROM 127 COUNTRIES The second show in 2019 of Istanbul Jewelry Show, one of the top five jewelry exhibitions in the world, has just ended. Organized by Informa Markets for the 49th time Istanbul Jewelry Show – October 2019, introduced over 800 companies and brands from 20 countries to 20.172 sector professionals from 127 countries.

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ecognized as one of the top five jewelry exhibitions in the world, and as Turkey’s first and only specialized international jewelry exhibition, Istanbul Jewelry Show – October 2019 has closed its doors. The exhibition whereby over 800 companies and brands from 20 countries showcased their products has been visited by 20.172 sector professionals from 127 countries.

Presidents of Associations from around 50 countries that had joined ASEAN Gems & Jewelry Association Conference as well as buyers from these countries visited Istanbul Jewelry Show and got together with professionals of the sector at the most prominent exhibition of the region. As part of the International Buyer Delegation Program

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organized alongside the exhibition, over 1.000 buyers from 70 countries have been hosted. Master and young designers showcased their trendy designs created for 2020 season at the Designer Market.

Turkey is now among the top destinations for global jewelry industry buyers!

Professionals of the global jewelry industry are showing growing interest in Istanbul Jewelry Show and Turkey every year.

And one of the most concrete examples of this growing interest has been the 12% increase in the number of international visitors of October 2019, compared to the exhibition in October 2018.

Compared to October 2018 exhibition, October 2019 exhibition saw a 12% increase in the number of international visitors.

Istanbul Jewelry Show plays an important role to Turkish Jewelry Industry reach its 2019 export target of USD 6 billion and March and October Exhibitions of Istanbul Jewelry Show broke its own record by hosting over 50 thousand jewelry buyers in 2019.

Again, at the October 2019 exhibition the number of international visitors increased by 164% for African countries, by 41% for North American countries, 11% for Asian countries, 10% for Middle Eastern countries and by 8% for European countries.

Istanbul Jewelry Show October 2019 featured the “International Buyer Delegation Program” with the goal of increasing jewelry exports, finding new markets and preserving the market share.

As part of the program, buyer delegation of over 1.000 professionals of the sector representing Europe, Middle East, USA, North Africa and Far East countries have been hosted at the exhibition.

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Designer Market was once again the heart of jewelry design!

Organized every year as part of Istanbul Jewelry Show – October 2019, the Designer Market, brought together master and young jewelry designers on the same platform.

Designers will be showcased their latest designs and signature jewelry products at the Designer Market, which is specially created at the exhibition venue.

ASEAN Gems & Jewelry Association Conference 2019 participants were hosted at Istanbul Jewelry Show!

ASEAN Gems & Jewelry Association Conference aims to facilitate networking and improve relations both among members of Precious Stone and Jewelry Associations in ASEAN region and with associations from NON-ASEAN countries (Australia, China, Hong Kong, India, Israel, Italy, Japan, South Korea, New Zealand, Sri Lanka, Taiwan, Turkey), Dialogue Partner Countries (USA, EU, Canada, Russia), Industrial Dialogue Partner Countries (Switzerland, Norway, Pakistan) and other countries, and to ensure coordinated work with associations from different countries. By visiting Istanbul Jewelry Show, Presidents of Associations from around 50 countries participating at ASEAN Gems & Jewelry Association Conference and professional buyers from these countries got together with the professionals of the sector at the most important event of the sector in the region.

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Conference participant countries that had a 96% share in the 88 Billion USD global jewelry imports in 2018, and 97% share in 110 Billion USD global jewelry exports, have offered great opportunities in terms of increasing market diversity for Turkey which aims to increase its jewelry exports.

UBM Rotaforte Founding Partner Şermin Cengiz: “We broke a record by hosting over 50 thousand jewelry buyers at our exhibitions in 2019” UBM Rotaforte Founding Partner Şermin Cengiz, “Thanks to our broad range of exhibitors that create trend-setting collections combining technology with design, Istanbul Jewelry Show exhibitions now attract greater attention from the global jewelry buyers. Number of international visitors at our March 2019 exhibition had increased by 9%. And our October 2019 exhibition where 51% of the visitors were from abroad, saw a 12% increase in number of international visitors. We are proud to have hosted over 50 thousand jewelry sector professionals at our March and October exhibitions that we organized in 2019. Istanbul Jewelry Show is capable of meeting all needs of jewelry buyers and with our 50th exhibition which will be organized in March 2020, we’ll continue to offer the ultimate platform for fueling exports of the jewelry sector of our country.”

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The buyers are hosted, free of charge in the best hotels

BOOK FOR TO THE MARCH EDITION OF IJS

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JTR is already working on the next group to be invited to the Spring edition of Istanbul Jewelry Show that will be held from March 19-22, 2020 44

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he Turkish Jewellery Exporters' Association (JTR) will welcome buyers from all over the world in Istanbul at the Istanbul Jewelry Show that is organised twice a year. During the previous show held in October, some 1,000 foreign buyers were hosted in Istanbul. The buyer’s programme is also Turkey’s most successful of its kind.

Turkey’s jewellery manufacturers and wholesalers that exhibit at the shows. Once the list is compiled and reviewed, the buyers, who hail from all over the world, are consequently contacted and invited. JTR takes well care of these buyers, by coordinating flights and hotel bookings, and by offering them a wide choice of services to make their visit and stay as effective and pleasant as possible.

The Istanbul Jewelry Show is now one of the most important jewellery fairs in the world. The efforts of the Turkish Jewellery Exporters' Association (JTR) have been central to the success of the Buyer’s Delegation Programme.

Many hundreds of foreign buyers in Istanbul were not only hosted free of charge during the İstanbul Jewelry Show, but also had a chance to create a tremendous, often new network of vendors to their businesses.

Jewellery buyers are hosted in the best hotels in Istanbul

Free accommodation to buyers Throughout the year, JTR expends intensive and continuous efforts to compile profiles and lists of preferred buyers that will be beneficial to

To JTR, it is important the members of the Buyer’s Delegation Programme arrive with high expectations and leave as ambassadors of IJS and the Turkish jewellery industry and trade.

It is therefore that these guests are hosted, free of charge, in some of the best available hotels, in close proximity to the IJS venue.

JTR is already working on the next group to be invited to the Spring edition of IJS that will be held from March 19-22, 2020.

For your reservation ; www.jtr.org.tr

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#primavicenzaoro Italian Exhibition Group (IEG), 2020 will open in Vicenza on 17th January under the banner of strategies and actions to promote the gold – jewellery industry.

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n agenda, two exhibition giants: VOJ - Vicenzaoro January The Jewellery Boutique Show and T-GOLD, the international show for machinery and the most innovative technologies applied to jewellery and precious metal processing, both showcasing until the 22nd. But that’s not all.

“The business and innovation combination,” said IEG President, Lorenzo Cagnoni, “is indispensable and every edition of our events are always further enriched. In this case it will be with the brand new VO VINTAGE event, an original exhibition dedicated to vintage watches and jewellery with unique items and some of the world’s most coveted rarities on display.

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An announcement that I know the whole market is pleased about.”

VO VINTAGE will have its own entrance and be held from 18th to 20th Janaury in the foyer on the first floor of the Vicenza Expo Centre in an exclusive context specifically for collectors and enthusiasts and will involve a select number of renowned exhibitors at this first edition. The exhibitors, some showcasing to the public for the first time, will be proposing their unique and timeless collections.

Stefano Mazzariol, one of the most prestigious names in the Vintage Watch sector, explained: “We will be at VO VINTAGE to meet a select and knowledgable audience. Selling vintage also means selling the history and culture of a vintage item so that

enthusiasts can discover and re-live the flavour of a watch from times göne by and be enamoured by the story that lies behind it”.

VO VINTAGE will be attended by great collectors, such as internationally renowned Sandro Fratini, and by the most esteemed and wellknown experts, such as Giulio Papi, the most famous master watch-maker in the world.

The first event of the year for the gold – jewellery industry (in fact, the official hashtage will be #primavicenzaoro), VOJ is the sector’s international hub of reference, the most exclusive and much-awaited stage for the market’s top brands to exhibit their latest creations.

IEG’s ownership and management of the Italian trade show Jewellery Agenda, which unravels with two editions of VO in January and September and OROAREZZO and GOLD ITALY in Arezzo, as well as other shows organized around the World for Italian companies, from the Arab Emirates to the United States, make IEG a key player: “The Customers,”explained Patrizia Cecchi, IEG’s Director of Exhibitions Italy, “acknowledge our role as a business platform for international relations.

Not only do we work meticulously on profiling buyers, we also bring them to where our companies’ identity is.

The identity of a historic, cultural and social territory. In a nutshell, this is Made in Italy promotion and we have a first-rate partner for this in ICE – the Italian Trade Agency, and another, Vicenza Municipality, for promoting the territory among an international public”.

According to data processed for FEDERORAFI by Confindustria Moda’s Research Centre, the first six months of 2019 saw a +6.2% increase in Italian jewellery exports.

VOJ 2020 hosts 1500 exhibiting brands – covering the entire production chain - and their arrangement into communities, based on positioning and target, facilitates the show experience for the traders, the majority of whom are foreign buyers from over 120 countries representing the most prestigious boutiques, malls, retailers and stores in the world’s largest cities.

Italian Exhibition Group, which will be closing an exceptional edition of Ecomondo, Europe’s number one show for the green, blue and circular economy, tomorrow at Rimini Expo Centre, will immediately re-open this highly topical file at VOJ 2020 under the banner of Sustainability, a theme developed and further examined in all its aspects during Cibjo’s main event as well as at the traditional Digital Talks and Gem Talks.

VOJ 2020 will also deal with another of Italian Exhibition Group’s key themes which regards trade shows as a bridge between the worlds of research and work. “We will have a hackaton in collaboration with Padua University,” Marco Carniello, IEG’s Jewellery & Fashion Brand Director announced from China, where he

is negotiating international VOJ relations.

“A ‘call for ideas’ open to 60,000 students and researchers summoned to find business solutions for new ways of creating innovative packaging will bring to VOJ the 40 best proposals to be placed before an advisory board consisting of sector companies and protagonists”.

Creativity and innovation will also be the focus of “VISIO.NEXT”, VOJ 2020’s opening conference, this year organized by Club degli Orafi.

At the same time as VOJ, Vicenza Exhibition Centre will also be attracting visitors from all over the world with T-GOLD, the international show for machinery and advanced technologies designed to increase the quality of jewellery processing. A 4,000 mÇ exhibition area in which top companies operating within the sector will be offering the latest ideas and technologies absolutely indispensable for jewellery producers that want to launch their business internationally.

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ROBERTO BRAVO OPENED A NEW STORE IN CHINA

Roberto Bravo has 14 stores in Venice and Moscow, and new store is opened in capital of China, in Tianjin.

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oberto Bravo continues to investment in abroad country.

Roberto Bravo has 14 stores in Venice and Moscow, and new store is opened in capital of China, in Tianjin. This is the first Turkish jewellery store in Beijing.

In You Yi Shoping Mall, Beijing Ambassodor of Turkish Republic Abdülkadir Emin Önen, Chairman of the Trade Council Hakan Kızartıcı, CEO of Roberto Bravo Mustafa Kamar, Brand Face of Roberto Bravo Victoria Bonya the executive vice-president of Gems & Jewelry Trade Association of China Sun Fengmin and Manager of You Yi Shopping Mall Wu Di attended at the opening ceremony.

At the opening Abdülkadir

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CEO of Robero Bravo Mustafa Kamar said, One Generation - One Way Silk Road has carried many products from porcelain to silk and tea from China to Istanbul and Europe. China meets jewellery and spices due to this road.

Emin Önen spoke that; Roberto Bravo is one of the most important brand of Turkey and we are here for the first investment of Roberto Bravo.

and east side of historical Silk Road and these countries making good combination of political trust and win – win economical corporation. Accordingly, in 2018

This store represents the only Turkish jewelry store in China. We hope this step will be followed by other Turkish brands. And he goes on these words. Turkey and China is two countries west

Turkey was declared the year of tourism in China and four-hundred-thousands Chinese came to Turkey. In a $ 23.6 billion trade with China was held in Turkey in 2018.

The process of eastern and western culture, which is began in the past, is highly regarded by the Chinese Government, today.

Because the Silk Road offers opportunities beyond the socio-economic and cultural harmony between east and west. As Roberto Bravo, we hope that our jewelry will bring cultural opportunities to China as well as many opportunities

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Head Office: Nuruosmaniye Mah. Şerefefendi Cad. No-27 Cağaloğlu Fatih 34110 İSTANBUL Store: Arapsuyu Mah. Atatürk Bulv. No:3 5M Migros AVM No:144 Konyaaltı/ANTALYA Serkan YILDIRIMER :0533 359 08 66

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TIFFANY’S SEES HIGHER HOLIDAY SALES ON STRENGTH OF CHINA

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iffany & Co. announced on Thursday Dec. 26 that its overall global sales during the holiday shopping season (from November 1 through Christmas Eve) rose about 1% to 3% compared with the same period last year, with the largest contribution coming from China, Europe and a recovery in the Americas. Mainland China drove the business during the holiday period, with Tiffany seeing a double-digit sales increase there, offset by declines in Hong Kong.

Overall, sales in Tiffany’s Asia-Pacific region, which includes greater China, rose 7% to 9% after accounting for currency movements. “We continued to see the Chinese Mainland drive our overall sales growth with a strong double-digit increase, offset by the persisting declines in the Hong Kong market and, to a lesser degree, Japan,” Tiffany CEO Alessandro Bogliolo said in a statement. In the Americas, Tiffany expects net sales growth of

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2% to 4%. “We are happy to see sales growth in the Americas, a momentum shift in the region,” said Bogliolo.

Meanwhile, Tiffany reported an impressive sales gain of 3% to 5% for the holiday period in Europe.

“We completed the enlargement of our flagship store in Shanghai, now the largest Tiffany store in Asia, in a prominent street-facing location within the Hong Kong Plaza mall. At this location, we also just celebrated the opening of the first Tiffany Blue Box Café on the Chinese Mainland. Our London flagship store on Old Bond Street was renovated. Additionally, we opened our third store in Kyoto, Japan and our newest one in the U.S., at Hudson Yards, our fifth store in New York City,” he added. “Our iconic flagship store on Fifth Avenue in New York City has remained open throughout the 2019 interim holiday period. The flagship store will close in mid-January 2020, at which time we will begin its complete renovation and temporarily move our operations to the ‘Tiffany Flagship Next Door’ at 6 East 57th Street.”

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ALROSA UNVEILS STRATEGY TO STREAMLINE DIAMOND MANUFACTURING

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he Supervisory Board of Alrosa has approved the miner’s three-year strategy for developing and streamlining its diamond cutting and polishing units for 2020-2022, as well as the plan to integrate the recently-acquired manufacturer Kristall into the Alrosa Group. The plan includes a set of measures focused on improving product mix efficiency, production cycle optimization and the creation of a consolidated sales system for polished diamonds, a strategy they believe will improve the operational efficiency of Alrosa’s consolidated diamond cutting activities.

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The Alrosa Group currently includes diamond cutting companies Diamonds of Alrosa (branches in Moscow and Barnaul), and Kristall (Smolensk), which was purchased from the state in October this year.

Together they account for more than 60% of diamond cutting and polishing in Russia. The company says it will redistribute its mix of rough diamonds for cutting, with fancy-colored and large colorless diamonds sent to Moscow while colorless diamonds weighing 1 to 10 carats will be moved to Smolensk to reduce costs. Small-size diamonds will be cut in Barnaul and Smolensk.

The total cutting volume will exceed 200,000 carats of rough diamonds.

The focal points of the strategy includes the centralization of rough-diamond allocation and polished sales; Diamonds of Alrosa will be selling the polished products. Alrosa plans

to create a consolidated sales service for polished diamonds based at this branch. Some of the employees of Kristall’s sales divisions will move to the new sales division.

“We aim to improve the quality of interaction with customers, develop new sales channels, implement joint marketing programs with jewelry manufacturers and introduce more automation and modern technologies,” says Sergey Ivanov, Alrosa CEO. “In our opinion, the merger of diamond cutting platforms will make it possible to reduce production costs and get a stable market share for polished diamonds with Russian origin marked by a high quality of cutting.” He also noted that their efforts to improve the efficiency of the Diamonds of Alrosa branch led to a positive financial result in 2019 for the first time in three years.

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JEWELERS OF AMERICA REACHES MILLIONS WITH CONSUMER MARKETING

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ewelers of America (JA) announced the results from the consumer marketing test-campaign that ran in Los Angeles, CA, from September 23 – November 3, 2019. “Another Piece of Your Story” was an industry-wide collaboration to increase consumer desire for jewelry by connecting consumers to the emotional aspects of jewelry ownership. Over 3,000,000 unique consumers were reached during the short, six week test campaign.

“The industry came together and we were able to execute a campaign by the industry, for the industry,” says JA President & CEO David J. Bonaparte. “The success of the test campaign gives us great promise for the future of a national campaign that can do so much for the jewelry industry.”

Jewelers of America hired Cramer-Krasselt (C-K) to create a campaign that focused on female self-purchasers outside of traditional gift giving times.

The test campaign media consisted of paid social ads including Facebook and Instagram posts, a rich influencer program and www. yourfinest.com - a website that connects consumers to the stories and jewelry from the campaign as well as connects them with a retail jeweler from which to buy jewelry.

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those, 27% clicked to link through to a retailer jeweler’s website •Those exposed to the campaign were 22% more likely to consider purchasing jewelry for themselves than those tht were not exposed to the campaign.

Four LA-based influencers were identified and hired as campaign contributors.

Together, they are a diverse group of women who all have a high concentration of the campaign’s target audiences as followers. The influencers each shopped at a retail jeweler and selected jewelry that spoke to them.

They shared “Another Piece of Your Story” on their social media accounts as well as on yourfinest.com.

The influencer posts had high positive sentiment and engagement from their followers.

Prior to launch, a pre-campaign survey was conducted in the target market and following the close, another post-campaign survey was completed.

Here are some of the

metrics and measurements from the effective test campaign: •28,912,531 impressions from 3,000,000 unique consumers across all media.

•The influencers created 13 pieces of content over the six weeks, generating over 17,500,000 million impressions •Respondents who saw the ads, visited the website or interacted with influencers were more likely to believe jewelry becomes more meaningful with wear and believe you should have nice pieces of jewelry.

•18% of visitors to yourfinest.com searched for a retailer jeweler - and of

Looking to keep the momentum moving in 2020 JA and has assembled a Consumer Marketing Committee made up of representatives from across the jewelry industry. The Consumer Marketing Committee will work to create a funding mechanism that will support a multi-year, national campaign.

The current Consumer Marketing Committee members include: Sarin Bachman, JCK & Luxury; Katherine Bodoh, American Gem Society; David Bonaparte, Jewelers of America; Gannon Brousseau, Couture; David Bouffard, Signet Jewelers; Caryl Capeci, Chow Tai Fook North America; Kirsten Darrow, Fred Meyer; Dominic Gabriel, Gabriel & Co.; Michael Lerch, GoldStar & Plumb Club; Mark Smelzer, Mark Smelzer; Dominick Sorresso, Rogers Enterprises, Inc. Additionally, the Committee will help move forward the plans to launch in additional markets in 2020.

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ROSY BLUE’S DILIP MEHTA LAUNCHING SYNTHETIC DIAMOND VENTURE

F GIA TO CLOSE SHOP IN DUBAI

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he Gemological Institute of America (GIA) is set to close its operations in Dubai.

According to sources, the GIA is making the move to ensure they use their resources as effectively as possible to fulfil their consumer protection mission, and will close its Dubai office by the end of the year.

The renowned diamond grading and certification lab most recently started operations at a new facility in Antwerp.

“The hard decision to close the Dubai operations was made to align GIA’s resources with our mission,” said Nirupa Bhatt, Managing Director, GIA India & Middle East.

“Laboratory clients who have previously used the take-in facility in Dubai may submit stones to any other GIA laboratory or take-in facility. The Dubai school location will continue to operate through Dec. 31, 2019. We are committed to fulfilling our obligations to our

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students and will continue to provide quality educational services during this closure period.” Students who wish to continue their GIA education or need to complete required lab classes within a credentialed distance education program may enroll through another GIA global location.

In the midst of market volatility, Bhatt says that the GIA remains focused on its mission: “The industry has been through many cyclical ups and downs, and throughout such periods - whether in the past or present - the GIA has always remained focus on its mission to ensure the public trust in gems and jewelry. The decision to close the Dubai location is to help the Institute align its resources to fulfil and further the mission.” In addition to opening a new lab in Antwerp, the GIA has expanded its operations in Hong Kong.

ormer CEO and now chairman emeritus of Rosy Blue Alliance, Dilip Mehta, has announced a new venture into synthetic diamonds, partnering with his sons to launch a business in Surat. Mehta is just the latest of many diamond veterans to test the synthetic-diamond waters. Speaking to the Times of India, Mehta made clear that the venture was fully independent of Rosy Blue. “This one is our own venture and nothing to do with Rosy Blue,” he is quoted as saying.

“We have done a lot of research and work in the last 12 months and now the time has come to put it into practice.” Mehta told the newspaper that the new company will manufacture 25,000 carats of diamonds and will import rough synthetic manufactured in China via Hong Kong.

“Our target market will be India along with the U.S. and Dubai,” he said.

“Gradually, we will be expanding our manufacturing capacity. Many diamond companies are already into lab-grown business, but they have not come out officially.

In [the] next couple of [years], you will see lot many companies in this lucrative field.”

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DIAMOND MARKET RECESSION CONTINUES TO IMPACT ANTWERP IN OCTOBER

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mports and exports of rough and polished diamonds to Antwerp slowed in October on a year-over-year basis as the market recession continued to impact the flow of goods and their prices. High inventories of polished goods continue to soften demand for rough goods to polish, pushing rough as well as polished prices down. It is worth noting, however, that while the average price of rough diamonds traded in Antwerp was 20% lower than in October 2018, they rose substantially from last month.

The volume of goods traded in the month of October also fell sharply on a year-over-year basis, according to figures from the Antwerp World Diamond Centre’s Diamond Office.

In October, the volume of rough-diamond imports to Antwerp declined by 12% while exports declined by more than 23% year-over-year. Coupled with a 20% decline in the average price per carat for both imports and exports, rough imports in October fell 30% to $529 million while exports declined 39% to $545 million. As noted, the average price of rough exports jumped 27% to $94 per carat from just $74 per carat last month; the average price of rough imports rose 21% to $97 per carat from $80 in September.

For the year to date, the average price per carat of rough-diamond imports and exports has declined by 16%, with imports currently sitting at $102 per carat ($121 in 2018) and export at $89 per carat ($107). The volume of rough carats imported is down 15% to 63.5 million carats; the volume of rough exports is down 17% to 81.8 million carats. As a result, the value of Antwerp’s rough-diamond exports, at $10.5 billion, is 30% lower than last year; the value of rough imports, at $9 billion, is down by 28%.

On the polished side of the trade, the average price per carat took a significant downturn in October, coming in well below the average for the year.

The price per carat for imported goods fell to $1,631 compared to the year’s average of $1,990, which is just a few dollars shy of the 2018 average. The price for polished exports tumbled as well, to $1,944 per carat compared to an average price of $2,465 for the year, which is 1% higher than in 2018.

PANDORA APPOINTS NEW CHAIRMAN

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andora has elected Peter Ruzicka to succeed Peder Tuborgh as chairman of the board, as part of its efforts to reinvigorate interest in its brand.

Ruzicka’s appointment follows the recruitment earlier this year of Alexander Lacik as CEO, along with other executive changes, as the company seeks to cut costs and improve its profit via its Programme Now strategy.

Pandora announced in March that Tuborgh would step down as the Danish jeweler recorded disappointing sales and experienced problems with its new jewelry lines.

“We are progressing quickly with Programme Now to reenergize our brand and restore growth,” Tuborgh said. “Now, the time is right for me and for Pandora to bring in a new chair to realize the long-term potential of our company.”

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EUROPE ADOPTS CUSTOMS CODE TO DIFFERENTIATE NATURAL & SYNTHETIC DIAMONDS

T HRD ANTWERP APPOINTS NEW CEO

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he diamond grading and certification lab HRD Antwerp has appointed a new CEO, Ellen Joncheere. HRD Antwerp has been in the business of grading and certifying polished diamonds since 1973, delivering some 130,000 polished-diamond certificates annually. It also offers diamond-related training and education programs, in Belgium and internationally, as well as developing and marketing technological devices such as microscopes, detection and screening equipment.

The company has undergone significant restructuring in recent years to adapt to the changing market conditions, opening new labs in promising diamond markets such as Turkey, India, Dubai and Hong Kong. “HRD Antwerp has an excellent reputation internationally and its grading certificates are very highly regarded, meeting the highest standards,” says Ari Epstein, CEO of HRD’s parent enterprise the Antwerp World Diamond Centre (AWDC). “We needed to find an excellent new CEO to safeguard the future of HRD Antwerp, and are very pleased to have secured the services of Ellen Joncheere.”

Ellen Joncheere for the past six years was the CEO of the Fremach

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International Group, a supplier to the automotive industry, and was formerly the CEO of Suez Bellux.

Joncheere commented, “After six years I was ready for a new challenge.

My experience in various industries, as well as helping to transform those companies to meet changing market conditions, will help me to enable HRD Antwerp to grow and strengthen its market position.”

According to the Belgian newspaper De Tijd, HRD Antwerp lost 4.3 million euros (US$4.8m) in fiscal year 2018. Ten years ago, HRD graded about 10% of the world’s polished diamonds, but the company has seen its market share diminish in recent years. With the appointment of a new CEO, discussions regarding the sale of the company have come to a halt, temporarily. Speaking to the Belgian newspaper, Joncheere addressed the issue of being new to the diamond industry: “I enjoy working for companies situated outside of my comfort zone. Furthermore, I have developed new strategies on several occasions for companies in markets undergoing transformation. I intend to do the same at HRD, which has had to face new competitors in recent years.” Joncheere expects to stay at least three years to develop a new strategy for HRD.

he European Commission has adopted a new customs code to differentiate between natural and synthetic diamonds. In a communication to the members of the national associations of the European Federation of Jewellery (EFJ) and to public authorities, the association applauded the pending entry into force of the new European customs code for synthetic diamonds. This code, introduced in the European combined nomenclature (Chapter 71), will enter into force as from January 1, 2020.

It will be applied until January 1, 2022, when the HS6 customs code, which was recently adopted by the World Customs Organisation (WCO), will be applied at the European level.

The EFJ and its membership pursued the adoption of this new European customs code, which will facilitate the monitoring of synthetic diamond flows in Europe, thus allowing better compliance with the Kimberley Process Certification Scheme. Although legitimate, synthetic diamonds fundamentally differ from natural diamonds, the EFJ writes. The EFJ says it therefore welcomes the acknowledgement of the difference between natural diamonds and synthetic diamonds by the European Commission through the new customs code. Given these fundamental differences, the EFJ also deems it essential to legally oblige retailers to duly inform consumers about the nature of the product they are selling. The EFJ will therefore continue to advocate the establishment of a European legislation differentiating natural diamonds from synthetic diamonds at retail level in order to ensure consumer protection through full product disclosure.

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DE BEERS PROVIDING ITS OWN CLARITY ABOUT NATURAL AND LABORATORYGROWN DIAMONDS

ALROSA, TENCENT & EVERLEDGER JOIN FORCES ON WECHAT ECOMMERCE PILOT

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lrosa, Tencent and Everledger are launching a new WeChat Mini Program e-commerce solution for Chinese retailers. The pilot will employ blockchain technology to enable full traceability of diamonds from mine to consumer, providing full transparency of their origin, characteristics and ownership history.

According to a release, Russian diamond producer Alrosa and independent technology company Everledger created this new Mini Program pilot to “put transparent and secure diamond information at the fingertips of potentially a billion active WeChat users. It is also the first product to capitalise on the synergy between Everledger and their new investor Tencent, creator of WeChat – one of the world’s largest social media and e-commerce platforms.” They explained that the WeChat Mini Program pilot will showcase diamonds from Alrosa, enabling full traceability from mine to consumer.

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proposition. The intention is to enable a better-informed and more secure purchase for consumers as well as a more seamless online-to-offline user experience.

Alrosa said that by enabling new touch points between consumers, jewelry manufacturers and retailers, the Mini Program will encourage brand differentiation in the highly competitive Chinese luxury market.

Alrosa will provide information on their diamonds extracted in Russia, thus enabling consumers to know the exact origin of each stone and have certainty around its sustainable and ethical footprint.

Pavel Vinikhin, Head of Diamonds of Alrosa (the company’s polishing branch), said the program “reinforces our pursuit for guaranteeing the origin of our products. We believe that this collaboration with the most popular social media platform in China will help us to further strengthen our sales there.”

Leanne Kemp, founder and CEO of Everledger, adds: “This pioneering collaboration is exactly why we launched Everledger – and it shows how far we have come since our humble beginnings in 2015.

Our blockchain and IoT solutions will enable key stakeholders in the jewellery industry to bring secure and reputable information to consumers in China and beyond.”

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he De Beers Group has created a new booklet to clearly differentiate between two “entirely different” products, with two entirely different value propositions, which now form part of its product portfolio: natural and laboratory-grown diamonds. Their “Summary of Facts” booklet, a copy of which we recently obtained, has been distributed to their ‘sightholders’ and stakeholders, and addresses the primary differences among the two products, such as; rarity, the types of jewelry for which they are appropriate, the environmental impact of the two products and the question of ‘legacy’ - highlighting the present and future positive impact that natural diamonds have on the communities that mine them.

The brochure is aimed to enable consumer-facing teams to explain clearly the differences between the products.

“With socially-conscious consumerism on the rise,” it starts out, “front-line teams need to be equipped to educate consumers about the many positive attributes and beneficial impact of diamonds, and dispel any myths or misconceptions. Making sure that consumers can make clear and informed choices about what they are buying is crucial if the opportunities [to grow demand for natural diamonds] are to be realised.” De Beers Group says that, as purveyors of both products, they are uniquely positioned to understand what differentiates them.

“This booklet equips diamond professionals with the facts to communicate accurately to consumers.”

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ALL SIGNET JEWELERS BANNERS INDIA’S POLISHED IN U.S. NOW SELL SYNTHETICS DIAMOND EXPORTS, ROUGH

IMPORTS WELL OFF 2018 PACE

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ased on research from Rob Bates of JCK Magazine, the United States’ largest retailer of diamond jewelry, Signet Jewelers, is now selling laboratory-grown diamonds at all its major U.S. jewelry banners. These include Kay, Jared and Zales, as well as their online site James Allen, which was already selling them. David Bouffard, Vice President, Corporate Affairs, told Bates that the sythetic diamonds will be available in bridal as well as fashion jewelry. Jared is selling loose lab-grown diamonds and ring settings as part of its Chosen collection.

An interesting obseveration from Bates is that Signet will not be accepting synthetics for trade-in, pointing out the uncertainty of their

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long-term value. According to ad copy Bates shares with his readers, Signet says the natural supply of diamonds is “finite and rare,” while the lab-grown supply is “potentially unlimited.” The Zales site reads, “We believe that diamonds are right for everyone, but everyone may have a different idea as to which diamond is right for them.” As Bates notes, “Zales currently lists two dozen man-made diamond pieces, ranging in price from under $1,000 to around $7,500.” De Beers’ efforts to erode the price of lab-grown diamonds by offering all its synthetic stones at the price point of $800 per carat to this point seems to have had a limited impact on the wider market.

ndia’s exports of cut and polished diamonds in October declined by 15.4% year-on-year to $1.95 billion as compared to $2.30 billion in October 2018, according to the provisional data released by The Gem & Jewellery Export Promotion Council (GJEPC) of India. The $1.95 billion is the same amount exported in September, which represented an 18% decline from the year prior. The volume of polished diamonds exported declined 8% to 2.8 million carats, as the average price per carat for the month fell 22% to $689 per carat. For the fiscal year to date (April - Oct. 2019), polished diamond exports have fallen 18% to $12 billion from $15 exported over the same period last year. For the calendar year to date, they are down 15% at $18.2 billion.

The average price per carat for the year to date (Jan.- Oct.) has only declined 4% to $755 per carat.

Rough imports during the month of October fell by 20% to $796 million from $990 million during the previous October. In volume terms, rough imports increased marginally by 2% to 9.9 million carats in October 2019 from 9.7 mcts during October 2018.

For the fiscal year to date, imports of rough diamonds have declined by more than 22% in value to $7.3 billion from $9.4 billon during the same period a year earlier. For the calendar year to date, the value of rough-diamond imports has lost 23% to $11 billion. In volume terms, India has imported 10% fewer rough goods, falling to 85 million carats for the first seven months of the fiscal year from 94 mcts in the same period last year.

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BAIN & CO, AWDC UNVEIL 2019 GLOBAL DIAMOND INDUSTRY REPORT: STRONG ORIGINS

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elcome to the ninth annual report on the global diamond industry, prepared by the Antwerp World Diamond Centre (AWDC) and Bain & Company. This year’s edition covers industry performance in 2018 and the first half of 2019 and explains key trends that are shaping the industry.

The report begins with key developments along the value chain.

In subsequent sections, we review factors that influenced rough diamond production and sales, midstream performance and global diamond jewelry demand in major markets. This year, we also review the industry’s performance over the past 50 years, analyze historic downturns and apply that history to recent events.

We updated our long-term outlook for the diamond industry through 2030. The 2030 supply–demand forecast considers announced production plans, recent changes in mining operations, potential additional sources of supply, expected changes in global and regional macroeconomic parameters, and potential impacts from lab-grown diamonds.

Key points are summarized below:

Short-term challenges caused mining and midstream revenues to shrink by 25% and 10%, respectively, in 2019.

Near record-high rough diamond production in the beginning of 2019 was followed by lower-thanexpected demand for polished diamonds, causing a ripple effect through the supply chain. The softer demand for polished diamonds was driven by two major factors: geopolitical and macroeconomic tension lowered consumer confidence and thus demand, and an increase in e-commerce created efficiencies in the supply

chain that decreased the need for inventory on hand.

Available financing for midstream players decreased by $5 billion since 2013. This

30% decline in financing impacted the ability of manufacturers to support the growth of their operations.

Traditional diamond banks curtailed their exposure to the diamond sector. Indian banks adopted a more conservative approach following the poor performance and challenges of the Indian financial sector at large. Cutters and polishers reduced rough diamond purchases about 30% to off-load inventory and improve their cash flow. In 2019, access to affordable financing became even more challenging for midstream players.

In 2019, global diamond jewelry retail sales are expected to decline by up to 2% in US dollars based on the retail performance during the first three quarters of the year. In local currency, we expect

the demand for diamond jewelry to remain stable. The strength of the holiday shopping season will determine the final outcome. The decline is driven by changes in the two largest markets, the US and China, where jewelry sales are expected to decline by 2% and 5%, respectively, in 2019. However, the holiday season may reversethat trend. In the US, the downturn is attributed to three things: shrinking consumer confidence, a decline in Chinese tourists that consequently lowered luxury purchasing, and a 15% tariff on Chinese jewelry that went into effect in September. Despite a shift toward local consumption, the diamond jewelry market in Greater China is also expected to decline.

Softer demand for polished diamonds led to a 3% drop in polished prices and is expected to lead to 10% to 15% lower revenues for midstream players. The

At just 5% to 10%, the share of online diamond jewelry sales lags behind other consumer products.

However, e-commerce is accelerating, and major diamond jewelry retailers in the US and China increased their online sales to 13% and 11%, respectively.

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slowdown resulted in some of the lowest profit margins experienced in years, as well as high inventory levels, which have been accumulating since 2017.

Rough diamond sales are expected to fall by 25% in 2019 though rough diamond production remained stable. Major rou-

gh diamond producers responded to midstream pressure by increasing their inventory levels and offering more flexible purchasing terms, cutting rough diamond prices by 5%. Junior miners lowered prices by 7% to 10% in attempts to minimize inventory.

Based on historic experience, the market typically returns to precrisis levels within one to two years. Aside from the cur-

rent downturn, the diamond market has faced only four recessions in the past 50 years. In the same time frame, rough diamond production has grown three times, and rough and 68

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polished prices have increased 450% and 250%, respectively.

We expect the midstream to clear its inventory backlog in the beginning of 2020, bringing a better year for the industry. However, based on our

historical analysis, the industry is not likely to fully recover in 2020 because of ongoing supply–demand inequality and limited growth of financing options for midstream players. Major diamond producers have not announced substantial mining plan cuts, and we do not expect significant retail growth in 2020, as consumers brace for a global recession. The industry will have a stronger chance to rebalance and grow in 2021.

Four key trends are currently shaping the diamond industry: The rapid growth of e-commerce in the diamond jewelry market lowered

polished sales performance in 2019 and will continue to influence the diamond pipeline. Online sales and more efficient supply chain operations require less inventory on hand, causing a need to rethink the business model for midstream players.

Marketing spending is increasing to address complex consumer needs. Customer

preferences are changing rapidly, and the diamond jewelry industry is facing increased competition from the Experiences and Electronics categories and from lab-grown stones.

The lab-grown diamond market grew 15% to 20% again in 2019. Chinese and Indian producers drove the increase, aided by the widening price differential of lab-grown diamonds versus natural ones and campaigns that leveraged the “green� benefits of manufactured stones. Select jewelry designers and retailers are beginning to use lab-grown diamonds,

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signaling their acceptance and driving lab-grown jewelry sales.

The focus on sustainability and social welfare is heightened. Both consumers

and the professional community are seeking transparency throughout the pipeline to ensure diamonds are sourced responsibly and produced sustainably. Blockchain solutions are being used to track diamond origin, and programs are emerging to minimize negative environmental impacts and to support people in remote locations with employment opportunities.

The long-term outlook for the diamond market remains positive despite shortterm challenges. In volume terms,

rough diamond supply growth is projected to be negative 2% or 0% annually. Demand for mined rough diamonds is expected to recover, either staying flat or growing up to 3% annually through 2030. Recovery

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requires continued growth of GDP, the middle class and purchasing power, particularly in China and India. To convert increased wealth into growth, the industry must also provide structured marketing support. Both industry-wide and company-specific marketing are necessary to revive and sustain demand.

In the conservative scenario, our projection accounts for a possible shift in consumer preferences away from natural diamonds due to lack of marketing support. It also reflects fundamental long-term supply and demand factors rather than shortterm fluctuations.

1. RECENT DEVELOPMENTS IN THE DIAMOND INDUSTRY • The diamond industry experienced short-term challenges in 2019, particularly compared with 2018, in which every segment of the value

chain improved. In 2019, rough diamond producers achieved near record-high production while jewelry retailers optimized and lowered their inventory needs. As a result, we expect mining and midstream revenues to decrease by 25% and 10%, respectively, in 2019 and diamond jewelry sales to be nearly stable in local currencies. • In the second half of 2018, demand for rough diamonds began to stall, causing inventories to rise and prices to decrease. In 2019, rough diamond revenue is expected to decline 25%. In response, major mining companies are adjusting production plans for 2019, cutting their minimum purchase requirements in half and lowering rough diamond prices by about 5%. Smaller players are dropping prices more significantly (as much as 10%), and many smaller producers skipped planned auctions in the third and fourth quarters.

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• After modest growth in 2018, cutting and polishing revenues are expected to decline 10% to 15% in 2019.

The surge in production, combined with more sophisticated inventory management by retailers, puts pressure on revenue and margins in the midstream. Many cutting and polishing manufacturers are reporting operating margins at or below their breakeven points. To maintain factory utilization, midstream players purchased more small stones, which increased demand for smaller rough diamonds.

• Retail demand has been mixed over the past year and a half. In 2018, robust diamond jewelry sales resulted in 2% growth. But in 2019, retail sales are expected to decline by up to 2% in US dollars and remain stable in local currencies This is a result of the trade tension between the US and China and deteriorating consumer confidence overall. In the US, a slowdown

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in Chinese tourism also negatively affected sales. Weakened currencies in most major non-US markets hurt retailers’ performance. Like never before, everyone is closely watching this holiday season, which will determine retail’s final annual results.

• The short-term situation remains uncertain: rough diamond production is still relatively high, whereas geopolitical and economic uncertainties loom over every key market.

• Learning from past diamond industry recessions, we foresee a resolution in the next two years. If the industry is appropriately supported by marketing, and barring any unforeseen economic or political shocks, it will rebalance. Campaigns should target the mass market, which is not traditionally covered by branded advertisers.

2. ROUGH DIAMOND PRODUCTION • Between 2010 and 2016, global production was consistently between 120 million and 130 million carats. In 2017, it jumped to roughly 152 million carats and then fell 3% to 147 million carats the following year. The decrease in 2018 is largely attributed to lower production in Australia, the Democratic Republic of the Congo and Russia. The unexpected closure of Mir in Russia and planned downscaling at Argyle in Australia contributed to the decline.

• The 26 million–carat production increase in 2017 was the largest single-year volume increase since 1986, and it created a surplus that affected the entire value chain. As a result, inventory in the mining and midstream markets increased through

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2019. Prices and revenues declined in both segments in 2019 despite only a slight decrease in consumer demand. Assortment sales shifted toward smaller stones in 2019, which also contributed to lower sales.

• In 2019, production is expected to drop an additional 4%. Production is depleting at Argyle in Australia; in South Africa, Venetia is transitioning from open pit mining to underground; and production levels were lowered at Orapa in Botswana. These changes will be partially offset by increased supply from several ALROSA mines in Russia and smaller players in Angola.

• During the first half of 2019, pressure on rough diamond prices, sales mix and sales volume led to lower adjusted EBIT (earnings before interest and taxes) margins for most producers.

ALROSA maintained the highest margin in the rough diamond production segment. Rio Tinto and several other junior miners with high shares of small-gem- and neargem- quality diamonds reported negative EBIT margins in the first half of 2019.

• We expect the supply of natural diamonds to decline substantially starting in 2021, with an annual decrease of 8% compared with 2020 projections. The downward trend from the past few years will be amplified by supply contraction at Argyle and at Diavik and Ekati in Canada

3. CUTTING AND POLISHING • In 2018, cutting and polishing revenue grew 3%, supported by a healthy increase in consumer demand for diamond jewelry. However, polished diamond sales are expected to drop 10% to 15% by the end of 2019 because of slowing demand for diamond jewelry globally, lower diamond content in jewelry designs, inventory 74

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optimization by major retailers and declining available financing for midstream players.

• The combination of lower polished diamond sales and excess inventory accumulated by the midstream in 2017 and 2018 reduced net imports by 3% and 30% in 2018 and 2019, respectively.

India experienced the steepest decline.

In India, weakened local currency, liquidity issues resulting from bank financing cuts, and ongoing effects of dem netization contributed to stockpiling of incoming goods • Slower sales and stretched working capital damaged th sector’s profitability. On average, operating margins in the cutting and polishing segment contracted 2% to 3% in 2019 compared with 2018. To sustain profitability, the midstream companies cut excess capacity and shifted their focus to melee diamond production to maintain factory utilization and minimize working capital. The decline of rough diamond prices exacerbated the situation, leading to stock devaluation and, in some cases, affecting financing options. In the midterm, the segment will continue to operate with significant pressure on the bottom line.

• Interest rates, maturity and availability of financing continued to challenge the midstream segment in 2019. Interest rates increased to match rising default risk. In 2019, cutting and polishing players needed longer-maturity loans for two reasons: growth in consignment practices increased the number of days for receivables to turn over, and inventory turnover days increased because of lower demand among certain assortment groups. Traditional diamond banks tightened financing and credit requirements, and key Indian banks became more conservative following the generally poor performance of the Indian financial sector. The current situation presents an opportunity for nontraditional financing options, which are currently limited to a handful of large midstream players.

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• Short-term pressure on the midstream could lead to longoverdue restructuring and consolidation within the segment. Even in the current situation, some companies are making money. Successful players have shifted from a supply-driven mindset to a demand-driven model in which they make purchasing decisions in line with downstream demand. These companies also offer greater transparency, which is attractive to financing institutions and banks.

4. DIAMOND JEWELRY RETAIL The global personal luxury goods market, the bellwether of the diamond jewelry industry, experienced slower growth in 2018 and 2019. The slump was caused by moderating global GDP growth, lower consumer confidence. Global diamond jewelry 76

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retail posted 2% sales growth in 2018, but sales are expected to decline by up to 2% in 2019, based on the results of the first three quarters. A strong holiday season could reverse the trend.

In 2019, US diamond jewelry retail sales are expected to fall 2%, in contrast to 3% growth in 2018. There are three key reasons for the reversal.

First, consumer confidence fell to its lowest point since 2016 because of uncertainties surrounding the labor market, trade tension and a possible recession.

Second, a continuous decline in Chinese travelers to the US lowered luxury purchases overall.

And third, an extra 15% tariff on Chinese jewelry went into effect in September 2019 and could impact sales during the crucial holiday season.

In 2018, the Chinese market, including Hong Kong, grew 4%. In 2019, that trend reversed; the Chinese market is expected to decrease by 5% in US dollars equivalent and 1% in local currency. The shift is attributed to yuan depreciation, declining consumer confidence stemming from trade tension between the US and China, and significantly lower sales in Hong Kong amid protests in the area. The decrease will be partially offset by growth in local consumption in Mainland China.

A repatriation trend is being driven by import duty reductions, stricter gray market control and price harmonization among international retailers.

The Indian diamond jewelry market declined by 1% in 2018 following rupee depreciation and the bankruptcy of large jewelry retailer

14-18-22 K

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Gitanjali in India. In 2019, sales are expected to return to healthy 3% growth due to increased customer confidence, a growing population of working women and a shift in preference from occasion-only to everyday jewelry. However, retail sales are being reined in by tighter tax controls for luxury spending, a spike in gold prices and continuing rupee depreciation.

In 2019, performance in Europe was negatively affected by sociopolitical turmoil in the UK and France, but this was partially offset by higher tourism spending in the Eurozone.

Japan is expected to remain stable in 2019 because of lower consumer confidence and decreased spending

by Chinese tourists.

The midterm outlook for 2019–20 remains uncertain given continued geopolitical instability, strong signs of an impending recession and limited marketing support, especially for nonbranded and lower-end jewelry.

The branded luxury diamond jewelry segment, which accounts for about 15% of the total diamond jewelry market, is expected to perform well, growing at high single digits. That is in line with the growth of personal luxury goods.

5. KEY INDUSTRY TRENDS

In 2018 and 2019, production of lab-grown diamonds increased 15% to 20%, with majority of the growth coming from China. As the lab-grown market evolves, several business models are emerging.

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Four trends have the highest potential to impact the industry in the near term: rapid growth of online sales channels, increased marketing spending to support the natural diamond industry, developments in lab-grown diamonds, and an increased focus on the environment and sustainability.

At just 5% to 10%, the share of online diamond jewelry sales lags behind other consumer products. However, e-commerce is accelerating, and

major diamond jewelry retailers in the US and China increased their online sales to 13% and 11%, respectively. Greater pricing transparency and retail stock optimization caused by e-commerce will significantly affect demand and pricing for polished diamonds.

Mining companies increased their marketing efforts, both brand-focused and generic, and raised marketing budgets to historically high levels. In 2019, more than $200 million was invested in diamond industry marketing, including $70 million to $80 million of generic marketing channeled through the Diamond Producers Association.

The industry is using marketing to combat complex challenges, such as rapidly changing customer preferences, increased competition from the Experiences and Electronics categories, and the rapidly growing lab-grown diamond market.

In 2018 and 2019, production of lab-grown diamonds increased 15% to 20%, with majority of the growth coming from China. As the lab-grown market evolves, several business models are emerging.

Chinese companies primarily use high-pressure, high-temperature (HPHT) technologies to produce rough diamonds, competing on lowest production cost. In the US, companies are pursuing a vertically integrated business model by selling premium branded jewelry. If we assume that early growth in the lab-grown market happened because both wholesale and retail prices were decreasing differentially, allowing players to earn better margins than with natural stones, then wholesale prices have stabilized. We expect additional pressure on retail prices to accelerate lab-grown diamond jewelry sales.

www.modaalyans.com

Fly Collection

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Both consumers and investors are demanding more transparent and environmentally responsible practices. Multiple industry initiatives are focused on pipeline transparency and traceability, which could increase the confidence of both lenders and consumers. Midstream operations may become more transparent and more efficiently managed as a result.

6. HISTORICAL ANALYSIS OF INDUSTRY RECESSIONS AND IMPLICATIONS Over the past 50 years, the diamond market has grown three times. Historically, nominal pricing adjustments for rough and polished diamonds were 4% and 3%, respectively. There has generally been a strong correlation between rough and polished prices, aside from some short-term deviations that can be explained by supply and demand issues.

The relationship between supply and demand is well illustrated throughout the industry’s recessions and recoveries. Since 1970, the industry has experienced four major downturns: global recessions disrupted the industry in the late 1970s and early 1980s and again in 2008–09. In 1985 and 2015, downturns were caused by inefficiencies in the diamond pipeline.

Downturns caused by global macroeconomic recessions typically experienced 6 to 12 months of price decline followed by one or two years to reach full price recovery.

Upstream players historically adjusted their supply of rough diamonds to support price recovery, and this helped midstream players and 80

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retailers destock until demand returned. In 2009, for example, mining companies decreased rough diamond sales by 50%.

In comparison, downturns caused by internal pipeline inefficiencies took longer to recover. In 1985, the introduction of Argyle increased supply by 7 million carats. It took three years for stock to fully work through the system and for prices to return to historic levels. In 2015, slower demand for diamond jewelry and retail footprint rationalization in China were followed by a 20% jump in production in 2017. Those factors led to stock accumulation throughout the pipeline, the effects of which are still felt today.

We expect 2020 to be better for the industry once the midstream starts to clear its excess inventory in the beginning of the year. However, ongoing supply–demand inequality will prevent full recovery of the industry and may be exacerbated by a continuing decrease in available financing for midstream players. Few producers have announced sufficient mining plan cuts, so we do not foresee a major decline in supply. Retail sales will not grow significantly because consumer confidence and spending are diminishing in anticipation of a global recession. There is also no short-term expectation of an increase in available financing.

The industry’s first and strongest opportunity to rebalance and regain growth will be 2021. Rough diamond supply is projected to decrease about 8%, and macroeconomic indicators are expected to improve if the global recession is short-lived.

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5 November 2019 | www.gold.org

Gold Demand Trends Q3 2019

Highlights Holdings in gold-backed ETFs hit a new all-time high of 2,855.3t in Q3. Holdings grew by 258.2t during the quarter, the highest level of quarterly inflows since Q1 2016.

Accommodative monetary policies, along with safe-haven and momentum buying, drove demand.

Central banks added 156.2t to reserves in Q3. The -38% y-o-y decline was partly due to Q3 2018 being the highest quarter of net buying in our records. Y-t-d, central banks have purchased 547.5t on a net basis, 12% higher y-o-y.

Jewellery demand was down 16% to 460.9t in Q3. Weak consumer sentiment due to continued geopolitical and economic uncertainty, coupled with substantially higher gold prices, dented jewellery purchases in all major markets.

Bar and coin investment halved in Q3 to 150.3t. Higher gold prices across many key currencies were the main cause of the decline to a multiyear low, as retail investors across the globe opted to defer purchases and lock in profits.

Gold supply rose 4% in Q3 to 1,222.3t. Growth was driven by a 10% increase in recycling – to its highest level since Q1 2016 – as the ongoing price rally continued to encourage selling back by consumers. Mine production of 877.8t was virtually unchanged y-o-y.

The gold price continued to rally, reaching new multi-year highs.

The gold price rose by 5% during Q3, finding sustained support around US$1,500/oz. The primary factors behind this price momentum continued to be ongoing geopolitical tensions, concerns of a slowdown in economic growth, lower interest rates and the level of negative yielding debt.

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Surge in ETF inflows supports Q3 gold demand growth Gold demand grew modestly to 1,107.9 tonnes (t) in Q3 thanks to the largest ETF inflows since Q1 2016.

A surge in ETF inflows (258t) outweighed weakness elsewhere in the market to nudge gold demand 3% higher in Q3. Although central bank buying remained healthy, it was significantly lower than the record levels of Q3 2018.

Jewellery demand (-16%) was hampered by the continued strength in the gold price, which hit new multi-year– and, in some cases, record – highs, as well as by consumer concern over the health of the global economy.

Similarly, the decline in bar and coin demand (-50%) in Q3 was driven primarily by the gold price: retail investors took the opportunity to lock in profits rather than making fresh purchases. Technology demand for gold fell 4% as economic challenges remained, but the nascent 5G infrastructure helped to slow the decline in the important electronics sector. With mine production virtually unchanged, a price-related 10% jump in gold recycling boosted gold supply 4% to 1,222t.

Gold demand boosted as surge in ETF inflows outweighed weakness elsewhere Tonnes 1,400 1,200 1,000 800 600 400 200 0 -200 Q3’18 Jewellery ETFs and similar products

Q3’19 Technology Total bar and coin demand Central banks and other institutions

Source: Metals Focus, World Gold Council

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Jewellery Jewellery demand was weakened by higher prices, down 16% to 460.9t • Jewellery demand fell 16% to 460.9t in Q3, its lowest level since 2010 • Consumers deferred purchases due to higher prices and the subdued economic sentiment • US demand, however, continued to grow in Q3, up y-o-y for the eleventh consecutive quarter.

Tonnes

Q3’18

Q3’19

World total

546.2

460.9

-16%

India

148.8

101.6

-32%

China

176.6

156.3

-12%

Jewellery demand fell 16% y-o-y in Q3 to 460.9t, its lowest level since Q2 2010 (422.8t). Consumers were deterred from making fresh purchases during the quarter as the price rally – which began in June – gathered momentum. The quarterly average gold price in Q3 was US$1472.47 – 21% (or US$259.3/oz) higher y-o-y. This price pressure was exacerbated by concerns over the health of the global economy, which encouraged many consumers to moderate their buying plans. Bright spots were few and far between, with most markets seeing significant y-o-y declines, particularly in Asia and the Middle East.

Y-o-y change

Jewellery demand fell to its lowest level since 2010 due to the higher price Tonnes 900

US$/oz 2,000 1,800

800

1,600

700

1,400

600

1,200 500 1,000 400 800 300

600

200

400

100

200

0 Q1’10 Jewellery

0 Q1’11

Q1’12

Q1’13

Q1’14

Q1’15

LBMA Gold Price (US$/oz, rhs)

Source: Metals Focus, Refinitiv GFMS, ICE Benchmark Administration, World Gold Council

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Q1’16

Q1’17

Q1’18

Q1’19

WOJ

Jewellery India Indian jewellery demand of 101.6t was almost a third lower y-o-y due to weaker consumer sentiment.

Jewellery demand suffered as consumer confidence fell further over concerns around the slowing economy.

Several indicators – such as lower sales volumes reported by large fast-moving consumer goods (FMCG) companies and domestic car/two-wheeler sales – pointed towards a slowdown in both urban and rural demand.1 Weak sentiment due to a liquidity crunch, excessive monsoon rains in some states, and the absence of any festivals, also influenced demand in the quarter.

Demand received no support from the domestic price either. The gold price rally powered ahead during the quarter: it breached the Rs35,000/10g level in mid-July and continued climbing to Rs38,795/10g by the end of August, before reaching an all-time high of Rs39,011/10g during the first week of September. The two-month leap of ~Rs5,000/10g – from Rs34,006/10g at the end of June – caught consumers completely off-guard, prompting many to delay buying. Despite a correction in the final few weeks

of the quarter – due to the decrease in the international gold price and a strengthening rupee – the impact on demand was muted as it coincided with Pitru-Paksha, an inauspicious 16 lunar day period during which Hindus pay homage to their ancestors.2 Demand was further dented by a 2.5% rise in the custom duty on gold to 12.5%. This higher rate hit sentiment amongst both the gold trade and consumers, and fresh jewellery purchases suffered as a result. Consumers preferred gold-to-gold exchanges, which accounted for an average of 50-60% of purchases, while retailers wound down existing stocks.

Wedding-related purchases provided some support during the quarter. Wedding days in the Southern states of Tamil Nadu, Kerala and Karnataka supported jewellery demand during August and September. But volumes were 15-20% lower y-o-y due to the higher gold price.

Jewellery retailers attempted to counter this by offering promotions – such as discounts on labour charges – but with limited impact.

Economic slowdown dampened urban and rural consumer sentiment in India % 10

% 10 9

8 8 6

7 6

4

5 2

4 3

0

2 -2

1 0

-4 Q2’12 GDP growth

Q2’13

Q2’14

Q2’15

Q2’16

Q2’17

Q2’18

Agricultural GVA growth (rhs)

Source: Bloomberg, World Gold Council

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1 For example, Hindustan Lever – India’s leading FMCG company – reported slower growth in Q3 2019 www.hul.co.in/Images/sq19-resultspresentation_tcm1255-541174_1_en.pdf 2 Pitru-Paksha occurred between 13 - 28 September.

Q2’19

WOJ

Jewellery China Jewellery demand in China declined 12% y-o-y in Q3 to 156.3t. This is 10% below the five-year quarterly average of 173.5t and the fourth consecutive quarter of y-o-y declines. Concerns over the health of the Chinese economy, as well as rising inflation in staples such as pork, meant that consumers prioritised spending elsewhere.

Plain and mass-appeal 24K gold jewellery suffered a double-digit y-o-y decline in Q3. As these products account for the largest segment in the market, this dragged overall jewellery demand lower. But there were bright spots during the quarter. Most retailers saw growth in the sales of 3D hard gold, 5G gold and other innovative products with lightweight and fashionable designs that appeal to younger consumers. Growth in these highmargin products also helped shore up jewellers’ profits during the quarter. But the lower market share and lighter per-piece weight of these innovative products meant

that their sales growth couldn’t reverse the falling trend in jewellery demand. Talks with our trade partners in the industry indicate that lighter, more aesthetic products are growing in popularity – consequently, these products are expected to take a larger share of the market in the longer run.

In what has become an increasingly visible trend, the traditional jewellery sales boost again failed to materialise during the long National Day holiday in October. As we mentioned in Gold Demand Trends Full Year 2018, the relevance of the golden week holiday as a shopping occasion has been fading over recent years.

Consumers, especially the younger generation, prefer to spend their money on experiential purchases. According to the Ministry of Commerce, there were 782 million domestic tourist trips made in China during the holiday, a rise of 8% y-o-y. In addition, China’s mainland box office revenue increased by more than 100% y-o-y during golden week.

Momentum in the gold price rally during Q3 kept consumers on the sidelines Index level 135 130 125

Gold prices in EUR, GBP, INR and TRY all hit record highs during the quarter, as well as in key producer currencies: CAD, RUB, ZAR and AUD.

120 115 110 105 100 95 90 Jan-19

Mar-19 US dollar

Euro

Indian rupee

May-19 Chinese renminbi

Note: Index level 01/01/2018 = 100.

Source: ICE Benchmark Administration, Datastream, World Gold Council

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Jul-19 Turkish lira

Sep-19 Pound sterling

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Jewellery Middle East and Turkey

The West

Demand for jewellery across the Middle East fell 12% to 35.3t, with nearly all markets seeing significant declines. With their local currencies pegged to the US dollar, consumers in both the UAE and Saudi Arabia were exposed to the full rise in the international gold price. In the UAE, gold jewellery demand fell 21% to 5.4t, while in Saudi Arabia it dropped 26% to 8.8t. The higher gold price was the primary reason for weaker demand, but consumer sentiment was also depressed due to concerns over regional economic growth and security. In Egypt, the y-o-y decline was more modest – down 5% to 7t – as the stability in the pound helped to offset the rise in the US dollar price.

In the US, jewellery demand in Q3 was 1% higher y-o-y at 28.5t. While this is the eleventh consecutive quarter of growth, it was at a slower pace than in Q2 (+3%). Consumer confidence in the economy remained upbeat during the quarter, helping to support sales, but deteriorated slightly compared to the first half of the year.

Demand was also hampered by the substantial rise in the gold price during Q3.

Turkey and Iran were the two exceptions in an otherwise dismal picture, although this was almost entirely due to the low-base effect. Despite the local gold price surpassing last year’s record highs, Turkish jewellery demand grew by 5% to 7.6t in Q3. However, the y-o-y comparison is flattered by Q3 2018 demand totalling just 7.2t, the lowest level of demand since Q4 2012. Iran recorded the largest y-o-y increase in Q3, rising by 32% to 6.1t. This marks a significant recovery from Q3 2018, when jewellery demand collapsed by almost 60% y-o-y to 4.6t, the lowest level in our records. The modest recovery in the Iranian rial, which begun in May, helped offset some of the rise in the international gold price this year.

European jewellery demand fell fractionally in Q3, down 1% to 12.4t. Faced with record prices in both euros and sterling during the quarter, and ongoing concerns over the health of European economies, consumers remained cautious with their spending. The largest y-o-y decline was seen in the UK: demand fell 4% to 4.4t with concerns surrounding Brexit intensifying as politicians and negotiators raced to reach an agreement ahead of the 31 October deadline. Modest y-o-y increases in France and Spain failed to offset the overall decline across the region.

Other Asia Fears over an economic slowdown and higher gold prices dented demand in smaller Asian markets.

Faced with a record local gold price amidst sluggish economic activity, Indonesian consumers reduced their jewellery demand by 15% in Q3 to 8.8t. This is the lowest level in three years, and 10% below the five-year quarterly average of 9.8t. Under these conditions, selling back took precedence over new purchases.

Vietnamese jewellery demand declined by 12% y-o-y to 3.6t, the lowest level of demand since Q3 2016 and the first y-o-y decline since Q1 2017. Both consumers and retailers remained cautious over the rising local gold price (which reached an eight-year high) and heightened volatility in the local currency. In Thailand, jewellery demand fell sharply by 12% y-o-y to 2.7t, due to the higher gold price and weaker economic growth.

By contrast, the picture in Japan appears relatively healthy.

Jewellery demand rose by 5% to 4.2t. Despite the higher gold price, demand for the popular Kihei gold chains – plain, heavy gold chains that serve as quasi-investment products – held up well.

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WORLDOFJEWELRY.NET January 2020

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