Lonsdaleit
Lonsdaleit (pomenovaný na počesť Kathleen Lonsdale), nazývaný aj šesťhranný diamant v odkaze na tvar kryštalickej štruktúry, je alotrop uhlíka s hexagonálnou mriežkou. V prírode sa vyskytuje zriedka, poznáme ho z meteoritov. Lonsdaleit bol prvýkrát zistený v Canyon Diablo, z meteoritu v kráteri Barringer (tiež známy ako kráter Meteor) v Arizone. Bol objavený v roku 1967. Lonsdaleit sa objavuje ako mikroskopické kryštály sa spájané s diamantom z meteoritu v Canyon Diablo; Kennyho meteoritom, Nové Mexiko, a meteoritom Allan Hills (ALH) 77283, Victoria Land, Antarctica. Bol tiež hlásený z Tunguska, Rusko.

Hexagonálny diamant bol tiež syntetizovaný v laboratóriu, ešte predtým, ako bol objavený v prírode v roku 1967. Je priesvitný, nahnedlej alebo žltej farby a má index lomu 2,40 až 2,41, čo je hustota 3,2 - 3,3 a tvrdosť 7-8 (11). V Mohsovej stupnici tvrdosi má diamant stupeň 10; nižšia tvrdosť lonsdaleitu je hlavne spôsobená nečistotou a nedokonalosťou v prírode sa vyskytujúceho materiálu.

V prípade čistej vzorky by mohol byť o 58% tvrdší ako diamant. Vo februári 2009 vedci z univerzity v Nevade a na univerzite v Šanghaji ohlásili simulácie, ktoré ukazujú, že sa veľmi že by mohol odolávať tlakom 152 GPa, teda oveľa vyšším ako diamant, ktorý za tých istých podmienok odolá 97 GPa.

Rapaport TradeWire - Friday, May 01, 2009
News: Markets remain quiet after holidays with short week in India due to elections. Trade confidence has improved as prices for goods under 2 carat have stabilized, but concerns remain about the future. Prices on larger stones still under pressure due to weak demand, as evidenced by exceptionally poor Russian tender results. India demand stable for SI and imperfect goods, with shortages in G-I colors. Rough sales and process have increased from all time lows as some large Indian factories resume production. De Beers 1Q production -91% to 1.1 million carats, and expects 5-10% drop in 2009 global retail sales. Rio Tinto reports blue diamond tender exceeds expectations with record prices. ALROSA plans new production pipes. Amazon 1Q profits +24% to $177 mil., sales +18% to $4.9 bil. Swiss watch exports -27% to $791 mil in March. Three Bangalore diamond dealers murdered, three brokers arrested. S. Africa’s Jacob Zuma wins majority vote in presidential election. Simcha Lustig, leader of Israeli diamond industry passes away at 72.

ANNOUNCEMENTS:

RAPAPORT BREAKFAST AT JCK VEGAS

"State of the Diamond Industry" by Martin Rapaport
Monday, June 1, 2009, 8:00-10:00 a.m.

Fair Trade Jewelry Conference, 1:00 - 4:30 p.m.

Venetian Hotel - San Polo Ballroom (Level 3)
RSVP: conference@diamonds.Net

Limited Seating. Reserve your space now!

For Additional Rapaport JCK information visit
http://www.diamonds.net/Events/

Rapaport International Diamond Conference
New York City - September 10, 2009

Save the Date
Reserve your space early. Email IDC@diamonds.net

RAPAPORT INDIA – CAREER OPPPORTUNITY

Energetic motivated assistant manager
with diamond industry experience and excellent references.
University-educated with fluent English, Gujrati and computer skills.
Resume to: career.India@rapaport.com

RETAIL QUOTE:

"People are coming in and so far this year theyre spending money, theyre spending in different areas. Theyre spending money on womens beauty, cosmetics, theyre spending money on shoes, handbags, mens clothing, womens high street fashion, our Wonder Room, which is a collection of fantastic products, anything from watches to phones to jewelry and diamonds. That business is really, really performing very strongly in 2009."

Paul Kelly
Chief Executive of Selfridges in London

WORLD NEWS:

De Beers 1Q Production -91%

De Beers production fell 91 percent in the first quarter of 2009, to 1.1 million carats, after the company scaled back its mining in line with the weakened demand for rough diamonds. Anglo American, which owns 45 percent of De Beers, expects production to ramp up again in the second quarter as many of its mines come back on stream.

U.S. Weekly Retail Sales -2%

Retailers experienced a drop in sales of 1.7 percent from one year ago for the week that ended April 25, 2009, according to the International Council of Shopping Centers (ICSC) and Goldman Sachs. The warm weather afforded consumers plenty of reasons to turn their attention to other activities, the groups concluded. The drop in chain store sales was the steepest since the week that ended February 7. For April, ICSC Research expects that sales will increase by 1 percent or more, inflated by the calendar-shift from when Easter fell out in each year.

Consumer Spending Drops, U.S. GDP Measures Steep Decline

U.S. consumer spending dropped by 0.2 percent in March, the first fall in three months, and worse than economists had expected. Incomes, reflecting the continued massive wave of layoffs, dropped by 0.3 percent. The Federal Reserve announced on Wednesday that it will keep rates low for the foreseeable future. The overall economy, as measured by the gross domestic product (GDP), fell at an annual rate of 6.1 percent in the first three months of the year.

Renewed Demand in India Brings Workers Back

After a downturn that saw more than 5,000 units closing shop and close to 200,000 workers laid off in Surat alone, the Indian diamond industry is now looking to hire about 50,000 people. The industry was hampered by huge inventories, but a 20 percent surge in demand for polished stones from the U.S., Europe and Asia has used up these stocks, and as many as 300 units have reopened. Some 40 companies have announced increases of more than 10 percent in workers salaries.

Brutal Murder of Brokers was Well-Planned

The murder of three diamond brokers, Shauhar Raza, Shani Abbas and Zabbir Abbas in Palanpur was a cold-blooded, meticulously planned crime, as indicated by evidence that their graves were dug before they were killed. Ishwar Rajput, a diamond broker, was apprehended by the Banaskantha police this past week, and Dhansinh Rajput and Lala Raval were arrested the next day. The accused apparently invited the brokers to Mangad with promises of a gala party, whereupon they murdered them and burnt their clothes and luggage. Ishwar took diamonds and gems worth $30,000 (INR 1.5 million), and $30,000 (INR 1.5 million) in cash was distributed among the thieves. Two suspects are still at large.

EU Renews Sanctions on Myanmar

European Union (EU) foreign ministers extended sanctions against Myanmar for another year Monday to push for democratic change, and called on Myanmars military regime to take steps to make planned 2010 elections "credible" and "inclusive." The sanctions were put in place in 2006 to protest the juntas crackdown on prodemocracy groups. The EU added other economic sanctions in 2007, including a ban on imports of timber, gemstones and precious metals from Myanmar. The sanctions have had little effect on the behavior of Myanmars military, which has held power since 1962. David Miliband, the British foreign secretary, said that the EU had to keep pressure on Myanmars military-led regime to introduce democratic reforms.

South Africa Bids to Beat Diamond Sector Slowdown

The Diamond Council of South Africa has brought together a working group that includes industry, the government, banks and labor, to find ways to ensure the survival of diamond cutters, polishers and dealers under crisis conditions and to grow the industrys global market share. The group has identified the need to address liquidity pressures, with assistance from banks and the government, or through some form of tax relief. The working group made a comparative study of leading cutting and polishing countries and looked at ways to grow demand and develop the right local skills.

Rapaport Weekly Broadcast

Everything was coming up platinum in Manhattan for this broadcast, recorded on spring preview day at Platinum Guild International. Jewelry style guru Michael OConnor discusses the latest trends in the world of platinum and diamonds.

http://www.diamonds.net/news/NewsItem.aspx?ArticleID=26164

WHOLESALE & RETAIL NEWS:

Amazon Profits Soar But Reports Cautious Outlook

Amazon.com Inc. reported that its net income increased 24 percent to $177 million in the first quarter, and that sales surged 18 percent to $4.9 billion. Amazons growth was fueled in part by aggressive discounting, causing some analysts to worry how it would affect their bottom line. But Amazon reported operating margins for the quarter of 6.6 percent, among the highest the company has reported in recent years. Looking ahead, company noted that its operating income could decline between 12 percent and 49 percent in the current quarter.

Christies Dubai Jewels Sale Tops $4M

Jewelry belonging to Umm Kulthum, a legendary Egyptian singer, sold for $118,000 at a Christies auction in Dubai on Tuesday night. The entire sale reached just over $4 million, with 76 percent sold by lot. The highlight of the sale was a kite-shaped, 5.01-carat, D, internally flawless diamond pendant, which sold for $194,500 to a Middle Eastern private collector. The number of Middle Eastern buyers at Christies auctions globally has risen 400 percent since 2004.

Swiss Watch Exports -27% in March

Swiss watch exports fell 27 percent in March to $791.3 million (CHF 914.4 million), according to the Swiss Watch Federation, with the high-end market particularly hard-hit. There were declines in almost all of the federations markets for the month, with exports to Hong Kong, Switzerland’s largest market, falling by 29 percent. Exports to the U.S. fell by half for the second consecutive month. Switzerland’s watch exports in the first quarter fell 24 percent to $2.5 billion (CHF 2.9 billion).

De Beers Expects 5-10% Drop in 2009 Retail Sales

Against the backdrop of the global slowdown, De Beers has decided to cut its production by 40 to 50 percent this year. According to Varda Shine, managing director of the Diamond Trading Company (DTC), demand at the retail counter should experience a drop of between 5 and 10 percent this year, but the fall in supplies will be much larger, leading to improved stability in the industry. The company has also decided to cut costs by 47 percent and to close some of its less-viable mines. Shine noted that DTC has revised prices of rough diamonds downward, but refused to divulge price details.

IBISWorld Predicts Mothers Day Jewelry Sales -19%

IBISWorld predicted a 19 percent drop in jewelry sales this Mothers Day to $2.3 billion. The market analysts expect an overall spending decrease of 15 percent to $12.9 billion. IBISWorld concluded that those who shop for mom will stay away from electronics stores, jewelry stores and department stores, downgrading their gift purchases to lower-priced merchandise and services. Earlier in April, the National Retail Federation released its Mothers Day projections, estimating jewelry spending at $2.3 billion and total spending at about $14 billion.

M.J. Christensen Begins Las Vegas Consolidation Sale

Jeweler M.J. Christensen is offering discounts of as much as 70 percent as part of an eight-week consolidation sale at all four of its Las Vegas, Nevada, stores. M.J. Christensen is closing its Galleria Mall location in nearby Henderson, but it will continue operating its three other freestanding stores in the area. The inventory up for sale is valued at more than $10 million. The sale is being managed by liquidators Buxbaum Jewelry Advisors. The consolidation is the largest in the companys 70-year history.

Man Sang Holdings Issues Profit Warning

Man Sang Holdings issued a warning that it expects to record a loss for its fiscal year that ended on March 31, 2009. The company attributed the projected loss to the declining real estate markets in Hong Kong and China. Man Sang Holdings, which deals both in pearls and jewelry products and in real estate development and leasing, is required to report any decreases in the fair value of the group’s investment properties.

Zalemark, M&L Jewelry Sign Agreement to Merge

Zalemark Holding Company signed a letter of intent to merge M & L Jewelry Company into Zalemark. The merger is subject to negotiation and execution of binding definitive documents. M & L Jewelry, a 33-year-old company based in Los Angeles, California, has a design and manufacturing facility in Guangzhou, China.

Good Demand for Diamond Jewelry During Akshaya Tritiya

Akshaya Tritiya, an auspicious occasion for buying gold, is seeing many customers opting for diamonds rather than gold. As gold prices soar, jewelers are promoting diamond jewelry, feeding a gradual shift in Indian consumer preference towards diamonds. Jewelers are offering promotions and discounts to take advantage of the growing market. Nonetheless, some gold shops reported that sales during the Akshaya Tritiya festival were as much as 20 times higher than on an average day. The majority of the sales were in the leading gold-houses such as Bheema, Alukkas and Josco, while small shops remained deserted — a result of the marketing strategies of the bigger stores, which included promotional offers, discounts and hallmarked jewelry.

Abramov Launches Lamont in Beverly Hills

Monty Abramov launched the Lamont diamond jewelry brand, which produces, under his direction, heirloom and unique diamond jewelry designs and diamond bridal jewelry. The collection highlights round, fancy shapes and natural colored diamonds ranging from 1 carat to more than 20 carats. The first piece in the Lamont collection is a classic 10-carat pear shape and baguette diamond ring set in platinum. Lamont will preview collections, by appointment only, to collectors and to select prominent independent retailers in the U.S. Lamont will launch globally at the Hong Kong Jewellery & Watch Show on September 23, 2009.

Damas Unveils Two Luxury Timepieces for Women

Damas unveiled two luxury timepieces for women from Jaquet Droz — the Date Astrale and the LHeure Céleste. The watches, from the brands Hommage Paris 1785 series, are crafted in 18-karat white gold, diamonds and mother-of-pearl. The Date Astrale has an off-center subdial at 2 oclock, and its face blends mother-of-pearl and diamonds, mounted on the horns and bezel. Its dial is traversed by a diamond indicating the date. The LHeure Céleste has a dial that displays a virgin canvas lacquered in black, against which a galaxy of planets in white gold are set with diamonds. Handcrafted in three dimensions, natural light illuminates its dial from unusual angles. Each watch is available in a "numerus clausus" limited edition of eight.

Jewelry Scam Prompts Consumer Warning in Oregon

The attorney general of Oregon warned consumers about a jewelry scam: Consumers have reported receiving an offer that looks like a green U.S. Postal Service tracking notice, saying that $50 worth of jewelry has been sent to the recipient but that a processing fee of $6.95 is required to receive it. The so-called pearl-and-diamond "gold-toned" necklace that the consumer receives has been valued at about $1. The card carries an almost invisible disclaimer that the promotion is not affiliated with the postal service. The company involved, Consumer Clearinghouse Distributors, owned by Emerson Direct of Naples, Florida, has been investigated in the past.

Birmingham Assay Office Warns About Gold Hallmark Checks

The Birmingham Assay Office in the U.K. reminded jewelers that hallmarking inspections are being carried out across the country. Spot checks in Birmingham and Southall showed that eight out of 10 items were not hallmarked. U.K. law states that any item of gold weighing more than 1 gram must be hallmarked. Stores are also required to display a dealers notice that explains hallmarking. Penalties for violating hallmarking law include fines of up to GBP 5,000 ($7,350) for each unmarked item or a maximum of two years in prison. The Assay office can hallmark items in 24 hours in urgent cases, and the group also provides dealers notices.

Cartier to Display Jewels of Famous for Centenary

Cartier will take a populist tack when celebrating its U.S. centenary. The jewelry house has collected pieces commissioned over the last century by the rich and famous, and has installed them in its Fifth Avenue flagship for "Cartier...100 Years of Passion and Free Spirit in America," opening May 1. The show is replete with objects like the Duchess of Windsors lorgnette and the diamond-and-panther brooch created for the Woolworth heiress Barbara Hutton.

Antwerpsche Diamantkring Waives Entrance Fees for Two Months

The Antwerpsche Diamantkring cvba (ADK) is waiving the fee for entrance to its exchange hall during May and June 2009 for diamantaires who are not members of Belgian bourses but who hold a 2009 membership in a bourse affiliated with the World Federation of Diamond Bourses (WFDB). The decision was taken to stimulate trade in the current difficult economy. The ADK is one of four diamond exchanges located in Antwerp, and is the worlds only bourse with an exchange hall dedicated to the rough trade.

WHO IS NEWS:

Cavalieri Tells Perus Jewelry Sector to Adopt CSR

Gaetano Cavalieri, president of the World Jewellery Confederation (CIBJO), called upon Perus jewelry sector to adopt strict standards of corporate social responsibility in order that they be properly integrated in the global market. Before addressing an international conference on jewelry in Peru, Cavalieri met with President Alan Garcia Perez to discuss the development of Perus jewelry industry.

Simcha Lustig Passes Away

Simcha Lustig passed away on Monday after a short illness at age 72. Lustig hailed from one of the founding families of the Israeli diamond industry, and was a member of the board of directors of the Israel Diamond Exchange (IDE) for 18 years. Lustig served as vice president of the IDE and as Israel’s representative on a multinational marketing committee established by the Diamond Trading Company (DTC). He was chairman of the Israel Diamond Institute Group of Companies (IDI) from 2003 to 2006. In 2008, Lustig received the Israel Diamond Industry Dignitary Award.

International Speakers Bureau Signs Simmons

Russell Simmons has signed with the International Speakers Bureau (iSB). As part of the exclusive alliance between the two, iSB will exclusively represent Simmons in booking speaking engagements. Simmons is co-owner of the Simmons Jewelry Company. He created the Diamond Empowerment Fund (D.E.F.), a nonprofit organization that raises money for education initiatives that develop and empower economically disadvantaged people in African nations where diamonds are a natural resource.

Gem-As Ogden to Speak at ICA Congress in China

Jack Ogden, chief executive officer (CEO) of the Gemmological Association of Great Britain (Gem-A), will be addressing the 13th International Colored Gemstone Association (ICA) Congress in Panyu, China, May 5 to 10, 2009. This event, the largest jewelry industry conference ever to be held in China, will provide an international forum for discussing the issues facing the colored gemstone and jewelry industry. Ogden’s subject will be "Gem Education for the 21st Century." For additional information, contact Arianna Maccaferri at arianna@gem-a.com.

Master Cutter McHardy Shows His Skills in Malaysia

Brian McHardy, a master diamond cutter from South Africa, was brought to Malaysia by Habib Jewels for its monthlong annual Diamond Fest, which ends on May 3, to show the art of diamond cutting. McHardy also unveiled the spectacular new diamond collection by Hearts on Fire that pays homage to eight of the worlds most inspiring architectural feats. McHardy, who was born and raised in the town of Cullinan, home of the Premier Mine, joined Boston-based Hearts on Fire in 1999.

IDCA Gives Awards for 09

The Indian Diamond & Colorstone Association (IDCA) selected its honorees for 2009. Fred Meyer Jewelers was named retailer of the year; the Pioneer Award was granted to Navratan Kothari, chairman of the KGK Group; and Vasantbhai Sanghavi and Chandrakant Sanghavi, the chairman and director of Sanghavi Exports, respectively, together earned IDCAs Lifetime Achievement Award.

Turkish PM to Attend Opening of CIBJO Congress in Istanbul

Recep Tayyip Erdogan, the Prime Minister of Turkey, has confirmed that he will attend the opening ceremony of the 2009 CIBJO Congress in Istanbul on May 3. Also representing the Turkish government at the opening ceremony will be Kursad Tuzmen, the countrys minister of foreign trade.

GIAs Weldon, Pardieu to Address ICA Congress in China

Robert Weldon and Vincent Pardieu, representatives of the Gemological Institute of America (GIA), will address the International Colored Gemstone Association (ICA) Congress in China. Weldon, manager of GIA photography and visual resources, will discuss “New Developments at the Gemological Institute of America." He will also share reports from GIAs recent travels to exotic gemstone localities around the world. Pardieu, supervisor of field gemology at the GIA laboratory in Bangkok, will discuss a new deposit of emeralds that was recently discovered in Davdar, in the Xinjiang province of China. The ICA Congress will be held May 5 through 10, 2009, in Panyu in Guangzhou province.

GENERAL NEWS:

Jacmel Jewelry Vault Manager Swipes $12M in Gold

The vault manager at Jacmel Jewelry has been charged with grand larceny and criminal possession of stolen property after she slowly stole about $12 million worth of gold by concealing small amounts in the lining of her pocketbook over the past 5 years. Teresa Tambunting, 50, worked at Jacmel for nearly 28 years and was made vault manager in 1991. After an investigation began, Tambunting wheeled a suitcase containing gold worth about $868,000 into the Jacmel office. She is out on bail.

BJP Fears Political Cost of Gujarat Diamond Workers Woes

In 2002 and 2007, the Bharatiya Janata Party (BJP) emerged triumphant in Gujarat with the support of diamond workers, who formed 10 percent of the electorate. But Narendra Modis BJP government, after the economic crisis hit the industry, was slow to respond, finally coming up with a relief package two days before the new round of polls was announced. The Election Commission will not allow the plan to be implemented until the election process is done at the end of May. Angry diamond workers have threatened to vote against the BJP in as many as nine constituencies — Surat, Ahmedabad (East), Banaskantha, Bhavnagar, Amreli, Junagadh, Mehsana, Patan and Rajkot.

Is Surats Improved Demand Just Pre-Election Hype?

Some diamantaires in Surat say there has been a slight improvement in the diamond industry, while others say these reports are politically motivated rumors, being spread to influence the fast-approaching poll. With official statistics showing a sharp decline in both exports and imports in March 2009, the issue has taken center stage in the election battle.

South Africas ANC Faces New Test

The ruling African National Congress (ANC) won 65.9 percent of the vote in this past weeks South African elections, on a platform that vowed to create more jobs and improve basic services. The ANC won 264 of the 400 seats in Parliament — just three seats shy of the two-thirds majority it needed to govern unopposed. Jacob Zuma, the ANC leader, is to be sworn in as president in May. The ANC has promised a massive infrastructure-spending bill, which it hopes will help fuel growth in the economy and lure private investment. It is also counting on a boost from gold, diamond and platinum operations, which havent been hit as hard by falling prices.

Ex-FedEx Worker Pleads Guilty in Heist Plot

Edward Flores, a former FedEx worker, pleaded guilty last week for his involvement in the hijacking of a FedEx truck in Manhattan and the kidnapping of its driver. The mastermind of the heist was allegedly Brian Greenwald, co-owner of Doppelt & Greenwald, who is accused of also planning several other crimes, including a armed robbery of his own store by thieves dressed as FedEX workers. Flores gave the hijackers cellphones, company uniforms and information on truck routes and timing before the heists. The 34-year-old faces up to 20 years in prison.

JVC Memo Transaction Seminar - May 29 at JCK Vegas

The Jewelers Vigilance Committee (JVC) and The Jewelers Board of Trade (JBT) will present “The Basics of Memo Transaction — The Dos and Don’ts of Trading on Memo” at the JCK Las Vegas Show on Friday, May 29, 2009, from 12:30 p.m. to 1:45 p.m., in the San Polo Ballroom, Room 3401, on Level 3 of the Venetian Hotel. The seminar is free to all JCK Show badgeholders and no prior registration is required. Attendees will receive a copy of “The Essential Guide to ‘Memo’ Transactions." For questions, contact Amy Greenbaum at amy@jvclegal.org.

DIAMOND MINING NEWS:

Rio Tinto’s Blue Diamond Tender Exceeds Expectations

Rio Tinto’s recent tender of its "Once in a Blue Moon" collection, comprising 16 lots of blue and violet diamonds from its Argyle mine in Australia weighing 287 carats, garnered record prices, according to Rio spokespersons, who did not disclose the value of the sale. Diamonds for the tender were sourced from several years of production at Argyle, which, the company recently reported, doubled to 4.4 million carats in the first quarter of 2009 due to the processing of higher-grade ore at the mine during the period.

Stornoway Targets Proceeds of $2M in Private Placement

Stornoway Diamond announced a brokered private placement of almost 9.1 million flow-through common shares, for gross proceeds of up to $1.7 million (CAD 2 million). Stornoway reported that the flow-through shares will be priced at 22 cents each and are subject to a four-month holding period. The compensation options will be exercisable at 22 cents and will expire two years following closing. The proceeds from the placement will primarily be used for Stornoways share of the exploration costs of the Renard Diamond Project in Quebec, Canada.

Namakwa Diamonds 1H Loss Grows to $77M

Namakwa Diamonds reported a loss of $76.7 million during the first half of its fiscal year 2009, up from a loss of $19.4 million one year ago. The junior miner laid off 562 employees. Low diamond prices caused Namakwa to process diamond inventory impairments to the value of $32.1 million. At the end of the half, the company had $21.4 million cash at hand, diamond inventory of $21.9 million and receivables of $8 million, for total assets of $52.2 million.

Mano River FY Income -33%

Mano River Resources net income fell 33 percent to $1.8 million during the fiscal year that ended December 31, 2008. During the year, the companys diamond project in Kono, Sierra Leone, sold 811 carats of diamonds from the Pol-K kimberlite for an average of $152 per carat, and a parcel of 253 carats from the Bardu kimberlite realized an average value of $54 per carat — but the company claimed that these grades were not representative. Mano River subsidiary Stellars new Mandala project in Guinea has so far this month yielded 1,649 carats of diamonds, for an average grade of 0.8 carats per cubic meter. Mandala is projected to produce an average of 10,000 carats of diamonds per month from May to December 2009.

Orion Souths Bulk Sample Program Recovers 520cts.

The final set of diamond results from underground bulk sampling of the Orion South kimberlite, in Fort à la Corne in Canada, recovered 519.63 carats. In the final sample, a total of 2,573 commercial-sized diamonds collectively weighing 519.59 carats was recovered from fourteen batches. Sixty-four diamonds greater than 1 carat were recovered, and 11 exceeded 2 carats; the four largest stones were 32.96, 7.23, 5.97 and 3.17 carats. With the processing of samples from Orion South now completed, a total of 2,346.27 carats have been recovered, for an overall average grade of 18 carats per hudred metric tons.

BRC DiamondCore Might Delist from TSX

BRC Diamondcore may delist from the Toronto Stock Exchange (TSX). The junior miner reported Thursday that it has until May 28, 2009, to comply with the exchange’s listing requirements. BRC DiamondCore posted a net loss of $86.2 million in fiscal 2008. The company suspended bulk sampling operations at all of its South Africa operations in the fourth quarter.

Peregrine Diamonds Funds 09 Nanuq Exploration

Peregrine Diamonds approved a $1.5 million exploration budget for its Nanuq property in Nunavut, Canada, which will set the stage for a drilling program in 2010. Peregrine discovered three diamondiferous kimberlites, Naturalik, Kayuu and Tudlik, at Nanuq in 2007, and many anomalies remain to be investigated. The program will begin in July, with results expected later in the year and in early 2010. Peregrine and its predecessor company have spent approximately $7.5 million on exploration at Nanuq so far.

Pangea DiamondFields Strengthens Project Portfolio in 08

Pangea DiamondFields reported excellent progress during its last fiscal year: It increased its holdings in the Cassanguidi project in Angola to 58.5 percent; it held its first sale from the Bakerville project in South Africa, yielding $1,448 per carat; and it recovered 2,600 carats from bulk sampling at the Longatshimo River project in the Democratic Republic of the Congo (DRC). The company reported that diamond revenue fell 42 percent to $2.8 million. Pangea sustained a loss of $17.2 million, a 9 percent improvement from one year ago.

Motapas Mothae Results Include Several Stones +20cts.

Motapa Diamonds and its joint venture partner Lucara Diamond completed diamond recovery work on their 100,000 metric ton (110,231 ton) bulk sample program at Mothae in Lesotho. One 15,390 metric ton (16,965 ton) sample yielded 1,519 stones totaling 715.79 carats, for a sample grade of 4.65 carats per hundred dry metric tons. Total diamonds recovered from tailings and the bulk sampling combined included 217 stones greater than 2 carats, 63 stones greater than 5 carats, 13 stones greater that 10 carats and 5 stones greater than 20 carats. The five largest diamonds weighed 24.60, 23.39, 22.71, 22.62 and 20.04 carats.

Report Questions Botswanas Funding of De Beers

Botswanas government should use the current downturn as an opportunity to take a second look at its agreement with De Beers, suggests a report by Bifm. In the report, an economic review of the first quarter of 2009, Keith Jefferis, the chairman of the Bifm Investment Committee, questions the governments logic of pumping money into De Beers at a time when Debswana is closing some mines and laying off workers. The report suggests that if the government is being asked to put more money on the table in its partnership with De Beers, it should first ask itself if the returns are worth the extra investments. The report also questions the marketing agreement that dictates that all diamonds produced by Debswana should be sold through the Diamond Trading Company (DTC), since the DTC has put these plans on hold.

Mining Symposium to Focus on Impact of Recession

The Capital Resources Conference, scheduled for Botswana in June of this year, will focus on how the global economic crisis has affected international mining companies operating in the country. The conference has high-caliber sponsors and presenters, among them the government of Botswana, the Canadian Trade Commission, Paydirt Media and Mining Weekly. Most companies involved in uranium, coal, copper, nickel and diamond mining in Botswana are scheduled to present. There will be pre- and post-conference roadshows to some of the resource projects highlighted at the conference, and attendees will have the opportunity to have one-on-one meetings with potential investors and fund managers.

ALROSA Plans Production Expansion at New Diamond Fields

Russias ALROSA is planning to launch production at new diamond fields, Sergei Vybornov, the company president, told reporters. In an interview with Interfax, it also emerged that ALROSA is considering withdrawing from the Luo-Kamachia-Kamajiku diamond project in Angola, since the venture is barely profitable and work there has virtually shut down. ALROSA owns a 45 percent stake in the project; Portugals Eskom owns the rest. Catoca mining company, ALROSAs second joint venture in Angola, will continue to operate. Vybornov also said that ALROSA will suspend plans to build two hydroelectric plants in Africa. The ALROSA Investment Group may sell its interest in an iron ore project in Yakutia, valued at $300 million to $400 million, to investors from China. Two unnamed companies are currently interested.

Pala Investments Calls a Rockwell Shareholder Meeting

Pala Investments Holdings, which holds almost 20 percent of the common shares of Rockwell Diamonds, has called for a special and general shareholders meeting of Rockwell to be held on May 14, 2009. Pala called the meeting in order to pass a special resolution to remove the directors of the company, to elect new directors and to amend and then terminate the companys shareholder rights plan agreement. Pala is exercising its right to call the meeting after Rockwells directors failed to call one that Pala had requisitioned.

Sunrise Diamonds Concludes Kaavi-Kuopio Acquisition

Sunrise Diamonds concluded its agreement with Nordic Diamonds to acquire Nordics 14 Kaavi-Kuopio claims in Finland, for which it issued 100,000 of its shares to Nordic. Sunrise also granted to Nordic a 1 percent gross overriding royalty on production of diamonds from the claims. Application will be made for the new shares to be admitted to trading on Londons Alternative Investment Market (AIM), and trading is expected to commence on April 30, 2009.

ECON WATCH:

For the week ending April 30, 2009

Apr. 30 Apr. 23 Chng.
$1 = Euro 0.755 0.768 -0.013
$1 = Rupee 49.7 50.1 -0.3
$1 = Israel Shekel 4.19 4.26 -0.07
$1 = Rand 8.46 8.96 -0.50
$1 = Canadian Dollar 1.20 1.24 -0.04

Precious Metals
Gold $886.20 $903.30 -$17.10
Platinum $1,103.00 $1,182.00 -$79.00

Stock Indexes Chng.
BSE 11,403.25 11,134.99 268.26 2.41%
Dow Jones Avg. 8,168.12 7,957.06 211.06 2.65%
FTSE 4,243.71 4,018.23 225.48 5.61%
Hang Seng 15,520.99 15,214.46 306.53 2.01%
S & P 500 872.81 851.92 20.89 2.45%
Yahoo! Jewelry Index 771.14 720.21 50.93 7.07%

USA
Birks & Mayors $0.37 $0.44 -$0.07 -15.91%
Blue Nile $42.74 $38.65 $4.09 10.58%
Charles & Colvard $0.42 $0.41 $0.01 2.44%
DGSE Companies, Inc. $1.00 $1.10 -$0.10 -9.09%
Fuqi International $6.31 $4.96 $1.35 27.22%
JCPenney $30.72 $26.68 $4.04 15.14%
Kohls $45.35 $44.30 $1.05 2.37%
Lazare Kaplan $1.45 $1.21 $0.24 19.83%
LJ International $1.09 $1.13 -$0.04 -3.54%
Macys $13.71 $12.62 $1.09 8.64%
Man Sang $2.21 $2.15 $0.06 2.79%
Movado Group $9.25 $8.59 $0.66 7.68%
Nordstrom $22.67 $21.14 $1.53 7.24%
Saks $5.17 $4.30 $0.87 20.23%
Signet $15.85 $16.24 -$0.39 -2.40%
Sothebys $11.69 $9.95 $1.74 17.49%
Tiffany $28.95 $26.80 $2.15 8.02%
Wal-Mart $50.41 $48.86 $1.55 3.17%
Zale $3.73 $4.41 -$0.68 -15.42%

EUROPE
Bulgari €3.90 €3.93 -€0.03 -0.76%
Bijou Brigitte €81.46 €79.66 €1.80 2.26%
Esa €2.74 €3.10 -€0.36 -11.61%
Golay-Buchel CHF 1,300.00 CHF 1,180.00 CHF 120.00 10.17%
LVMH €57.39 €54.35 €3.04 5.59%
Pinault P-R SA €58.45 €57.74 €0.71 1.23%
Richemont SA CHF 20.60 CHF 20.70 -CHF 0.10 -0.48%
Swatch Group CHF 160.30 CHF 161.60 -CHF 1.30 -0.80%
Theo Fennell (pence) 16.70 16.70 €0.00 0.00%

INDIA (rupee)
Classic Diamond 13.04 11.87 1.17 9.86%
Gitanjali Gems 66.55 67.00 -0.45 -0.67%
Rajesh Exports 26.70 28.35 -1.65 -5.82%
Ren. Jewellery 26.65 27.00 -0.35 -1.30%
Su-Raj Diamonds 26.45 26.50 -0.05 -0.19%
Titan 748.40 763.15 -14.75 -1.93%
Zodiac JRD 12.60 12.50 0.10 0.80%
Suashish Diamonds 182.00 140.65 41.35 29.40%

NEW ZEALAND
Michael Hill NZD 0.55 NZD 0.54 NZD 0.01 1.85%

MINING STOCKS
(pence unless noted)
USA
Anglo American $10.78 $9.87 $0.91 9.22%
CANADA
Archangel CAD 0.05 CAD 0.08 -CAD 0.03 -37.50%
Harry Winston CAD 5.00 CAD 5.15 -CAD 0.15 -2.91%
Mountain Province CAD 1.28 CAD 1.29 -CAD 0.01 -0.78%
Peregrine Diamonds CAD 0.59 CAD 0.63 -CAD 0.04 -6.35%
Rockwell Diamonds CAD 0.06 CAD 0.05 CAD 0.01 20.00%
Shore Gold CAD 0.43 CAD 0.42 CAD 0.01 2.38%
Stornoway Diamond CAD 0.17 CAD 0.18 -CAD 0.02 -8.33%
True North Gems CAD 0.09 CAD 0.10 -CAD 0.01 -5.26%
UK (pence)
African Diamonds 22.7 22.5 0.2 0.84%
BHP Billiton 1,424.0 1,385.0 39.0 2.82%
Firestone Diamonds 27.5 24.0 3.5 14.42%
Gem Diamonds 125.5 130.0 -4.5 -3.46%
Gemfields 4.3 4.3 -0.1 -1.39%
Mano River 4.0 4.3 -0.3 -6.35%
Mwana Africa 5.9 4.6 1.3 27.27%
Namakwa Diamonds 26.0 29.5 -3.5 -11.86%
Petra Diamonds 47.5 40.0 7.5 18.75%
Rio Tinto plc 2,774.5 2,571.0 203.5 7.

Rapaport TradeWire - Friday, May 08, 2009
News: Rounds in 0.90-2.00 ct., H-I, VVS-VS improving with healthy demand for oversizes. Indian demand rising but cash buyers are price resistant and requesting very deep discounts. U.S. retail demand continues to slow with lower price points expected for Mothers Day. China’s gold and jewelry sales +20% over May Day holiday weekend on May 1. Blue Nile 1Q sales -11% to $62.4 mil., net profits -25% to $1.9 mil. Bidz.com 1Q sales -50% to $31.2 mil., profits -67% to $1.5 mil. Finlay 4Q sales -22% to $263 mil., net loss of $63 mil. vs. net profit of $13 mil. Signet 1Q sales -7% to $763 mil., same store sales -3%. Suashish Diamonds 4Q sales -70% to $15 mil., net loss of $4 mil., vs. profit of $1 mil. Diavik mine production expected to drop 41% to 5.4 million carats in 09. Japan’s March polished imports -21% to $59 mil.

ANNOUNCEMENTS:

RAPAPORT BREAKFAST AT JCK VEGAS

Monday, June 1, 2009
Venetian Hotel - San Polo Ballroom (Level 3)

"State of the Diamond Industry" by Martin Rapaport,
8:00-10:00 a.m.

Bankers Conference,
11:30 a.m. - 12:30 p.m.

Fair Trade Jewelry Conference,
1:00 - 4:30 p.m.

RSVP: conference@diamonds.net

Limited Seating. Reserve your space now!

For Additional Rapaport JCK information visit
http://www.diamonds.net/Events/

Rapaport International Diamond Conference
New York City - September 10, 2009

Save the Date
Reserve your space early. Email IDC@diamonds.net

RAPAPORT INDIA – CAREER OPPPORTUNITY

Energetic motivated assistant manager
with diamond industry experience and excellent references.
University-educated with fluent English, Gujrati and computer skills.
Resume to: career.India@rapaport.com

RETAIL QUOTE:

"These are challenging times, not bad economic times — they just inspire us to get creative. We started during one of these times, and again in the 1980s; at Christmastime we just turn off the news and remain positive. Our onsite casting and repair shop has been a tremendous asset, and we can keep the cost of our product very competitive. During these challenging times, people tend to eliminate marketing from their budgets to try and save money, but you really need to market more. If people see that you are positive and confident, they will feel more confident to come in and make that special purchase. It is just fun to be in here, and we enjoy every one of our customers."

Jim & Sherry Hofstetter
J.R. Hofstetter, Jefferson Village, Ohio

WORLD NEWS:

U.S. Consumer Sentiment Rises on Obamas Policies

Pumped up by faith in President Barack Obamas policies, U.S. consumer sentiment rose to 65.1 in April from 57.3 in March, according to a survey by the University of Michigan and Reuters. In mid-April, the estimate was 61.9. The April result is the highest since September 2008. Sixty-five percent of consumers thought that Obamas policies would improve the national economy, and 43 percent thought that they would improve their financial situation. However, most continue to be concerned about their personal finances and are cutting spending.

May Day Gives Chinese Retail, Jewelry a Boost

China’s retail sales grew 9 percent during the three-day May Day holiday. Based on figures from 1,000 major domestic retailers that it monitors, Chinas Ministry of Commerce estimated that retail sales reached $1.8 billion (CNY 12 billion). The ministry reported that sales of gold and other jewelry rose 20 percent.

Boycott of Pakistani Blood Emeralds Urged

A campaign to boycott emeralds from the Pakistani district of Swat has begun, because the money could be used to buy explosives for the Taliban. The Taliban have seized two of the emerald mines in Swat, declared them a trust and are mining them around the clock. The profits are split between the Taliban and the miners, potentially netting the Taliban about $3 million a year.

Rapaport Weekly Broadcast
Very poor consumer spending habits continue to pressure the industry, as publicly listed companies report steep declines in sales and demand.

http://www.diamonds.net/news/NewsItem.aspx?ArticleID=26282

DIAMOND STATS:

Japan’s Polished Diamond Imports -21% in March

Japan’s polished diamond imports fell 21 percent to $59.3 million in March 2009. Imports by volume rose 26 percent to 217,956 carats, as the value per carat dropped 37 percent to $272. During the first quarter of the year, Japan’s total diamond imports fell 19 percent to $174.3 million, but they were up 7 percent in terms of volume, to 508,577 carats.

RETAIL & WHOLESALE NEWS:

U.S. April Retail Sales Slide, High End Hit Hardest

April retail sales results are as follows: Neiman Marcus April sales fell 21 percent to $271 million and same-store sales dropped 23 percent. Third fiscal quarter revenue declined 24 percent, and comparable revenues decreased 25 percent. Nordstrom April sales were down 7 percent to $561 million and same-store sales decreased 11 percent. First-quarter sales fell 9 percent to $1.7 billion, and same-store sales declined 13 percent. Saks April sales plunged 31 to $238.7 million and same-store sales dropped 32 percent. First-quarter sales fell 27 percent to $615.1 million and same-store sales were down 28 percent. Macys April sales declined 10 percent to $1.7 billion and same-store sales dropped 9 percent. First quarter sales decreased 10 percent to $5.2 billion and same-store sales fell 9 percent. J.C. Penney April sales declined 5 percent to $1.3 billion and comprarable store sales were down 7 percent. Kohls April sales slipped 2 percent to $1.2 billion and same-store sales decreased 6 percent. Dillards April sales dropped 10 percent to $429.3 million and same-store sales fell 6 percent. First-quarter sales were down 16 percent to $1.4 billion and same-store sales declined 13 percent. Costcos April sales decreased 6 percent to $5.2 billion. Comparable store sales dropped 8 percent. BJs April sales decreased 3 percent during April to $719 million and comparable club sales declined by 5 percent. First quarter sales were flat at $2.3 billion and same-store sales fell 2 percent.

U.S. Weekly Retail Sales -1%

U.S. chain store sales fell 0.8 percent for the week ending May 2, 2009, according to the latest results from the International Council of Shopping Centers (ICSC) and Goldman Sachs. Week-to-week comparisons, however, provided a slightly better outlook, as sales rose 0.7 percent from the previous week. ICSC Research anticipates that aggregate reported sales for the month of April will increase at least by 1 percent from a year ago.

Hong Kong Retail Sales -8% in March

Hong Kong’s retail sales fell 8 percent in March to an estimated $2.7 billion (HKD 20.8 billion). Discounting deflation, sales decreased by 9 percent during the month. Declines in sales of jewelry, watches, clocks and valuable gifts fell 10 percent by volume during the month.

Blue Nile 1Q Sales -11%, Profits -25%

Blue Niles first-quarter sales fell 11 percent to $62.4 million. Cost of sales dropped 13 percent to $49.2 million. Gross profit as a percent of sales rose 140 basis points to 21.2 percent. The improvement reflected Blue Niles ability to benefit from declining diamond prices. The companys net profits decreased 25 percent to $1.9 million. International sales were down 3 percent to $5.6 million, but excluding the impact of a stronger dollar, Blue Nile reported, international sales rose 19 percent. This means that sales in the U.S. market were $56.8 million, a decline of more than 12 percent from a year ago.

Su-Raj 4Q Sales -4%, Profits -70%

Su-Raj Diamonds net sales fell 4 percent to $145.3 million (INR 7.2 billion) during its fourth fiscal quarter that ended March 31, 2009. Diamond revenues declined 6 percent to $38.2 million (INR 1.9 billion), while jewelry revenues dropped 3 percent to $107.1 million (INR 5.3 billion). Su-Rajs net profits plunged 70 percent to $1.3 million (INR 63.5 million) for the quarter. Su-Raj’s consolidated financial results for the full fiscal year saw net sales rise 16 percent to $533.5 million (INR 26.4 billion), and profits falling 42 percent to $8 million (INR 394.3 million).

Titan Industries FY09 Profits +11%, Jewelry Sales +36%

Titan Industries, which owns the Tanishq brand, reported that its net profits were up 11 percent to $32.9 million (INR 1.6 billion) for the year that ended March 31, 2009, as net sales rose 28 percent to $770.9 million (INR 38.3 billion). Jewelry sales grew 36 percent to $555.8 million (INR 27.6 billion), and profits from the jewelry segment increased 51 percent to $33.1 million (INR 1.6 billion). The company plans to close its two Tanishq boutiques in the U.S.

Finlay FY Sales +5% to $754M, Reports Loss of $107M

Finlay Enterprises sales rose 5 percent to $754.3 million for its fiscal year that ended January 31, 2009. The company had sales of $444.6 million at department store-based jewelry counters, a drop of 10 percent from one year ago, and $310 million at specialty jewelry stores, up 39 percent. Finlay reported a net loss of $107.3 million, widened from a loss of $10 million one year ago. The group is exiting the department store business model, and plans to close approximately half of its specialty jewelry stores in 2009.

Charles & Colvards 1Q Sales -27%, Reports Loss of $1M

Charles & Colvards sales in the first quarter dropped 27 percent to $2.5 million, and the company repored a net loss of more than $1 million, up from a loss of $698,085 one year ago. Charles & Colvards U.S sales for the quarter fell 29 percent to $1.7 million, and international sales fell 21 percent to $800,000. The average selling price per carat decreased 13 percent from one year ago, due to a special pricing promotion. The companys immediate priorities include an attempt to find more sales opportunities.

Bidz.com 1Q Revenue -50%, Profits -67%

Bidz.com reported net revenue of $31.2 million for its first quarter, down 50 percent from one year ago. U.S. sales represented almost 70 percent of the total. Net income fell 67 percent to $1.5 million for the quarter, which ended March 31, 2009. The auction website revealed that the number of new buyers dropped 39 percent to 51,021, the average selling price per order dropped by $1 to $181, and the average number of items sold per day dropped 50 percent to 6,110. Bidz.com anticipates that net revenue for its second and third quarters will be lower than in first quarter.

Flawless Diamond 4Q Sales +10%, Profits -94%

Flawless Diamonds net sales rose 10 percent to $35.5 million (INR 1.8 billion) in the fourth quarter that ended March 31, 2009. Net profits for the period dropped 94 percent to $107,209 (INR 5.3 million), due in part to a 16 percent rise in expenses to $34.8 million (INR 1.7 billion). Flawless Diamond ended the fiscal year with sales up 9 percent to $123.8 million (INR 6.1 billion), while net profits declined 45 percent to $2.7 million (INR 133.5 million).

Suashish Diamonds 4Q Sales -70%, Posts Net Loss

Suashish Diamonds reported net sales fell 70 percent to $15.1 million (INR 748.5 million) in the fourth fiscal quarter that ended March 31, 2009. The company posted a net loss of $4.1 million (INR 200.6 million) for the quarter. For the full fiscal year, sales declined 25 percent to $149.7 million (INR 7.41 billion), and Suashish reported a net loss of $12.3 million (INR 607.8 million).

Signet 1Q Sales -7%

Signet reported that group same-store sales fell 3 percent, and total sales dropped 7 percent to $762.6 million, during its first quarter that ended May 2, 2009. The weak British pound impacted the sales figures for the U.K., which showed a decline of 28 percent in dollar terms, to $137.8 million. At constant exchange rates, however, U.K. sales decreased only 2 percent. Same-store sales in the U.K. were down 4 percent. Sales in the U.S. fell 1 percent and same-store sales dropped 3 percent.

Sothebys 1Q Rev. -58%, Reduces Headcount 20%

Sothebys first-quarter revenue fell 58 percent to $54.4 million. The decrease was primarily due to a 71 percent decline in net auction sales. The auction houses net loss for the first quarter increased by 178 percent to $34.5 million, or 53 cents per share. Sothebys plans to reduce its headcount by 20 percent, for an annual cost savings of approximately $24 million.

London Jewelry Sale at Bonhams Approaches $2M

Bonhams London sale of fine jewelry on April 29, 2009, came in at almost $1.9 million. The sale featured 136 lots, of which 68 percent were sold. Seventy percent of the buyers were privates. A pear-shaped, fancy light pink diamond, weighing 1.47 carats, sold for $30,000, and a round brilliant-cut diamond weighing 5 carats, D, VS1, sold for $194,000, against a presale estimate of $117,600 to $147,000.

International Diamond & Gold of Ohio Forced into Liquidation

International Diamond & Gold plans to liquidate and close its four stores in central Ohio and four more in Washington state. The Columbus-based jeweler was put into receivership by Huntington National Bank after defaulting on a $12.25 million loan with $11.5 million still outstanding. Michael Barren of Barren & Merry will oversee the liquidation, which is set to conclude no later than August 30, 2009. The liquidation is expected to fetch $13 million on inventory valued at $50.4 million.

M.J. Christensen to Rebrand One of its Locations After Closing Sale

Retailer M.J. Christensen plans to reopen its Henderson, Nevada, Galleria Mall location under the new name LaReverie after the consolidation sale that is underway there is finished. The new store will focus on "price points primarily between $300 and $2,500," with "strong self-purchase appeal for the fashion-conscious woman." M.J. Christensen plans to continue operating under its namesake at its three freestanding locations at Boca Park and Montecito Marketplace in las Vegas and at Eastern and Coronado streets in Henderson.

Still No Sign of Australian $1M Diamond Ring

In a smash-and-grab robbery, a 9.1-carat solitaire diamond engagement ring was stolen from Hardy Brothers jewelers in Melbourne, Australia, in broad daylight on March 29, 2009, but the piece has not yet turned up. Investigators suspect the thief has tried to sell the diamond.

Bonhams June Sale Features Tourmaline

Bonhams in New York will hold an auction on June 1, 2009, featuring 525 lots of mineral specimens, gold nuggets, lapidary works of art, gemstones and jewelry. Tourmaline is featured in more than 50 of the lots; many shades of the gemstone will be on offer in both polished and unpolished form, as unmounted stones and in jewelry. Leading the tourmaline offerings is a multicolor jewelry suite comprising 59 tiny, intricately hand-carved flowers by German lapidary master Manfred Wild, with a presale estimate of between $28,000 and $35,000.

Recessionistas Scoop Up Big and Blue Diamonds

Australian jewelry makers say that diamonds are becoming an investors new best friend in the wake of the property slump and the stock market slide. In recent months the value of smaller mainstream white diamonds has fallen sharply, but some jewelers here say the market for larger stones is growing. So-called "recessionistas" apparently see these diamond as a good investment. The fancy colored diamond market is also surprisingly strong, as evidenced by the success of a global auction of a rare collection of blue diamonds from the Argyle mine.

Goenka Diamonds & Jewels Launches Ceres Collection

Goenka Diamonds & Jewels has launched "Ceres," a high-end diamond jewelry brand, sold at an exclusive Ceres store in Mumbai. Three more Ceres retail outlets will open this year in Bangalore, Delhi and Kolkata, and plans are underway for international stores. Prices start from $20,000 and run into the hundreds of thousands. Goenka, which also owns the lower-priced G-Wild line, plans to invest close to $30.4 million on its retail plans this year.

Tiffany Buys Lambertson Truex

Luxury jewelry retailer Tiffany & Co. has bought Lambertson Truex, the 10-year-old upscale handbag and other accessories brand, which filed for Chapter 11 in March. Majority owner Samsonite put the brand up for sale in December.

Ultra-Wealthy Rank Graff as Best

High net-worth consumers in the U.S. rated Graff the best among luxury jewelry brands, according to the Luxury Institute. Consumers who recommend Graff describe the brand as "large and understated but beautiful diamond jewelry" and having "ultimate quality and design." Harry Winston and Buccellati were ranked second and third, respectively.

WHO IS NEWS:

Julie Haack Receives WIN Business Award

The Women’s Initiative Network (WIN) awarded Julie Haack, president of Donald Haack Diamonds & Fine Gems, with the Elaine Creasser National Christian Business Woman’s Award.

Zalemark Appoints Ta as Company VP

Zalemark appointed Jenny Ta, principal of investment banking and consulting firm JC Concorde Securities, as a vice president. Ta will be handling a comprehensive shareholder and external communications program for the jewelry brand. Zalemark also signed a licensing agreement with artist Deb Eiseman for a watch and jewelry line centered around Eisemans healing-inspired artwork.

LVMH Appoints Dufour to Head Zenith

LVMH Moët Hennessy Louis Vuitton appointed Jean-Frederic Dufour to be president and chief executive of Zenith Manufacture, effective June 1, 2009. Dufour previously worked at Cie Geneva, Swatch Group and Ulysse Nardin, and has been head of product development for Chopard Watches and Jewellery since 2001.

Jewelers Mutual Appoints Copeman as President

Jewelers Mutual Insurance Company appointed Darwin Copeman as the company’s new president and chief executive officer (CEO). Copeman has more than 30 years of insurance experience. He will join Jewelers Mutual on May 18, 2009.

Former Friedman’s CEO Gets 12 Years for Fraud

Bradley Stinn, the former chief executive officer (CEO) of Friedman’s and Crescent Jewelers, was sentenced to 12 years imprisonment for securities fraud, mail fraud and conspiracy. A jury found Stinn guilty of leading a multiyear securities fraud scheme that resulted in Friedman’s shareholders and other victims losing more than $20 million.

Israels Avidar Calls For Aggressive Marketing Programs

Eli Avidar, managing director of the Israel Diamond Institute Group of Companies (IDI), called upon the global jewelry and diamond industries to “think out of the box” about marketing their products during the current economic crisis. He added that now, as other enterprises are pulling out, is the best time to introduce aggressive, strategic advertising and marketing programs in all media. Avidar cited the Israel Diamond Institutes “Together Works” campaign as an example of the type of marketing initiatives he is calling for.

Judge Denies Plea Request in Donnelly Murder Case

Christopher DiMeos motion to plead guilty in killing Fairfield jewelers Tim and Kim Donnelly four years ago, on the condition that he get a life term instead of the death penatly, was denied by Connecticut Superior Court judge. DiMeo pleaded guilty in the June 2005 killing of Long Island, New York, jewelry store owner Thomas Renison and was sentenced to life in prison in that case. Kimberly Pearce, DiMeos girlfriend, pleaded guilty in November to helping plan the murder of the Donnellys. She is facing up to 50 years in prison.

Buffett Says Consumers Have Changed Habits

Warren Buffett said during the companys shareholders meeting on Saturday that Berkshire Hathaway will report a roughly 10 percent drop in its first-quarter operating profit, to about $1.7 billion. Jewelry stores, Shaw carpet, Acme Brick and Clayton Homes performed poorly he said. Buffett remains optimistic about the long-term prospects of the U.S. economy, but said that it is difficult to predict when the recession will end. Many consumers who still have the same jobs, same savings and same homes responded to the financial turmoil by changing their spending and buying habits dramatically, and this shift in consumerism may spell a slow recovery.

GENERAL NEWS:

2009 CIBJO Congress Wraps Up

During the three-day CIBJO Congress, which ran from Sunday, May 3, through Tuesday, May 5 in Istanbul, Turkey, the CIBJO General Assembly unanimously passed sweeping changes to its statutes, extending voting rights to members representing commercial entities while preserving the role of national associations. Committee highlights included the Diamond Commission, which discussed at length the issue of a nomenclature for gem-quality synthetic diamonds, and the Pearl Commission, which passed a motion to disclose pearls as "color-induced cultured pearls" if a new treatment was applied to them during the growth process. The congress also decided to create a new standing committee for chief executives of industry organizations. Dr. Gaetano Cavalieri was reelected CIBJO president.

Dealers Club Disputants File Warring Briefs

Diamond dealer David Abraham called upon the Supreme Court of New York to void the vote that was taken on December 4, 2008, by the members of the New York Diamond Dealers Club to change the clubs bylaws, and to void the subsequent general election of February 26, 2009, in turn. In the most recent development in the case, both sides filed briefs in which they laid out their two different versions of how the clubs bylaws and New York statutory law define the consequences of nonpayment of dues and the resulting automatic suspension of membership — a definition that would determine the eligibility of those voters who paid their dues, or were given dues waivers, on the day of the vote itself.

Wrekins $16M Ruby Loses Promise

After U.K. company Wrekin Construction collapsed, investigators discovered that a wildly overvalued ruby had a role in the companys downfall. In 2007, Wrekin issued $16 million (GBP 11 million) of preference shares to Derbyshire construction firm Tamar Group in exchange for a mysterious ruby named the "Gem of Tanzania." The ruby had been valued at just $447,000 a year before, however, and it turned out that the two separate valuations that placed it in the tens of millions were forgeries. The record for the most valuable ruby ever sold is $4.5 million.

Grand Jury Indicts Six Men in Salesman Robbery Case

A federal grand jury in Columbus, Ohio, indicted six men on April 28, on one count each of conspiracy and interfering with interstate commerce for an April 3 robbery of $1 million worth of jewelry. The jeweler was likely followed to a restaurant parking lot in Westerville, Ohio, where the robbers smashed his windows and took jewelry cases. Oscar Ferero, 26; Fernando Patino Cruz, 25; Kevin Ismael Miranda, 29; and Bernardo Sanchez-Perez, 35, of Los Angeles, as well as Donald Jose Bonilla-Canales, 34, and Yhariel Allesandro Roverando-Mondragon, 38, are all in New Jersey awaiting transfer to Ohio.

Rosy Blue Publishes its First CSR Report

The Rosy Blue Groups first corporate social responsibility (CSR) report is now available online at www.rosyblue.com/html/csr_report.html. The report summarizes the group’s CSR activities in 2008, and highlights how Rosy Blue has managed its social, environmental and community impacts, as well as its committed strategy moving forward.

Rio Tinto Launches Champagne Diamond Competition

Rio Tinto Diamonds launched the Champagne Diamond Design Competition, which aims to attract talented new jewelry designers to showcase the range of champagne diamonds in innovative designs. The competition comprises four categories, with the overall winner receiving the title of "Champagne Visionary." The four winning designs will form part of a nationwide travelling exhibition hosted at leading jewelry retail locations.

Platinum Guild Announces Platform for 2009 JCK, Couture Shows

Platinum Guild International USA will be bringing the “Platinum Pavilion" — which will serve as both a location for platinum designers booths and an educational center — to both the JCK and Couture shows this year. At Couture, PGI will host the second annual “Platinum Couture Style Challenge,” which recognizes and promotes creatively-designed, unique platinum pieces.

JA Pushes Back Date of 2010 Winter Show

JA New York and the National Jeweler Network have scheduled the JA NY Winter Show 2010 for February 28 through March 2, 2010, which is later than the usual January time slot, in order for retailers to assess post-Christmas and Valentines Day inventory before the show. JA reported that the response to the new dates has been enthusiastic.

GIA India to Launch Classes in Hyderabad

The Gemological Institute of America (GIA) India plans to offer a pearl-grading lab class and a retail jewelry management (RJM) business course at the Golconda Institute of Diamonds in Hyderabad.

Gübelin Gem Lab to Hold Off-Premises Testing in NY

The Gübelin Gem Lab will hold off-premises testing services in New York City from May 20 through 27, 2009, at 589 Fifth Avenue, Suite 1205, between the hours of 9 a.m. and 6:30 p.m.

MINING NEWS:

Diavik Diamond Production to Drop 41% in 2009

Production at the Diavik Diamond Mine in Canada is expected to fall 41 percent to 5.4 million caratsin 2009, as owners Harry Winston and Rio Tinto scale down output to meet the slump in demand. Harry Winston, which has a 31 percent “economic” share in the mine, has budgeted $130 million for capital expenditure at the mine in the next three years, allocating $47 million to the fiscal year ending January 31, 2010. Open pit mining at Diavik is expected to conclude in 2012, and underground mining is expected to reach its ongoing capacity of 1.5 million metric tons (1.7 tons) a year in 2013.

Shore Gold Recovers $4M from ABCP Investment

Shore Gold received $4.4 million as a partial return of principal from its $19 million asset-backed commercial paper (ABCP) investment that was essentially frozen since August 2007. The Pan-Canadian Investors Committee worked out a restructuring plan with all affected stakeholders, and it was approved by the court in January. Shore Gold has $20.2 million in cash and short-term investments, more than enough for the exploration work and desktop studies necessary to reach a production decision in 2010.

Lucara Diamond Signs Agreement to Acquire Motapa

Lucara Diamond signed an agreement to acquire all outstanding shares of Motapa Diamonds. Each Motapa share will be exchanged for 0.9055 shares of Lucara. The convertible securities of Motapa will be acquired at the same exchange ratio. Motapa will hold a shareholder meeting to vote on the transaction on June 26, 2009. If the acquisition passes, the combined company will include the major Mothae diamond development project in Lesotho.

Archangel Calls Off De Beers Refinancing

Archangel Diamond Corporation has called off a fundraising plan which would have given De Beers a 72 percent stake in the company. De Beers, which owns 58 percent of Archangel shares, was scheduled to raise its stake in a $2.6 million (CAD 3 million) private placement and $6.7 million (CAD 7.9 million) debt restructuring announced on March 20. The funds were to be used to restructure existing debt and enable Archangel to meet its normal running costs. Archangel is now seeking alternative financing.

Stornoway Encouraged by Diamond Processing at Aviat

Stornoway Diamond recovered 213.2 carats of diamonds from processing 148.3 metric tons (163.5 tons) from the ES1 kimberlite at its Aviat Project in Nunavut, Canada. The three largest diamonds recovered weighed 3.99 carats, 1.72 carats and 1.22 carats. A total of 302.7 carats of diamonds have now been recovered from 190.9 metric tons (210.4 tons) from ES1, for an overall diamond recovery rate of 159 carats per hundred metric tons. The next stage of the project will be to conduct a market valuation on the full parcel of diamonds, which will proceed once the market stabilizes.

Pala Proposes List of Names to Run Rockwells Board

Pala Investments Holdings released a list of people whom it contends are strong candidates to run Rockwell Diamonds. Pala, which owns a 20 percent stake in the junor miner, has called a special shareholders meeting for June 17, 2009, to vote on whether to remove Rockwells current directors and elect new ones. Pala also expects the shareholders to vote on terminating the companys shareholder rights plan agreement.

Harvard Study Criticizes Child Labor in Diamond Mines

Harvard Universitys human rights program says children are being exploited as a source of cheap labor for diamond mines in Sierra Leone. The civil war that raised awareness of "blood diamonds" and led to the creation of the Kimberly Process has ended, but the lives of children working in the mines have not improved. Many children came to the mines after their parents were killed or wounded during the war, and these children are being exploited, the Harvard researchers say, working long hours in dangerous conditions for very little pay.

ECON WATCH:
For the week ending May 7, 2009

May. 7 Apr. 30 Chng.
$1 = Euro 0.746 0.755 -0.009
$1 = Rupee 49.1 49.7 -0.6
$1 = Israel Shekel 4.12 4.19 -0.07
$1 = Rand 8.41 8.46 -0.05
$1 = Canadian Dollar 1.16 1.20 -0.04

Precious Metals
Gold $910.50 $886.20 $24.30
Platinum $1,145.00 $1,103.00 $42.00

Stock Indexes Chng.
BSE 12,116.94 11,403.25 713.69 6.26%
Dow Jones Avg. 8,409.70 8,168.12 241.58 2.96%
FTSE 4,398.68 4,243.71 154.97 3.65%
Hang Seng 17,217.89 15,520.99 1,696.90 10.93%
S & P 500 907.36 872.81 34.55 3.96%
Yahoo! Jewelry Index 764.25 771.14 -6.89 -0.89%

USA
Birks & Mayors $0.46 $0.37 $0.09 24.32%
Blue Nile $44.61 $42.74 $1.87 4.38%
Charles & Colvard $0.44 $0.42 $0.02 4.76%
DGSE Companies, Inc. $1.00 $1.00 $0.00 0.00%
Fuqi International $7.34 $6.31 $1.03 16.32%
JCPenney $30.04 $30.72 -$0.68 -2.21%
Kohls $44.29 $45.35 -$1.06 -2.34%
Lazare Kaplan $1.60 $1.45 $0.15 10.34%
LJ International $1.36 $1.09 $0.27 24.77%
Macys $12.81 $13.71 -$0.90 -6.56%
Man Sang $2.21 $2.21 $0.00 0.00%
Movado Group $8.76 $9.25 -$0.49 -5.30%
Nordstrom $23.31 $22.67 $0.64 2.82%
Saks $4.41 $5.17 -$0.76 -14.70%
Signet $17.56 $15.85 $1.71 10.79%
Sothebys $11.99 $11.69 $0.30 2.57%
Tiffany $28.20 $28.95 -$0.75 -2.59%
Wal-Mart $49.85 $50.41 -$0.56 -1.11%
Zale $3.70 $3.73 -$0.03 -0.80%

EUROPE
Bulgari €4.10 €3.90 €0.20 5.13%
Bijou Brigitte €87.73 €81.46 €6.27 7.70%
Esa €2.88 €2.74 €0.14 5.11%
Golay-Buchel CHF 1,365.00 CHF 1,300.00 CHF 65.00 5.00%
LVMH €58.53 €57.39 €1.14 1.99%
Pinault P-R SA €60.92 €58.45 €2.47 4.23%
Richemont SA CHF 22.38 CHF 20.60 CHF 1.78 8.64%
Swatch Group CHF 177.40 CHF 160.30 CHF 17.10 10.67%
Theo Fennell (pence) 16.70 16.70 €0.00 0.00%

INDIA (rupee)
Classic Diamond 13.00 13.04 -0.04 -0.31%
Gitanjali Gems 72.25 66.55 5.70 8.56%
Rajesh Exports 29.50 26.70 2.80 10.49%
Ren. Jewellery 26.00 26.65 -0.65 -2.44%
Su-Raj Diamonds 26.90 26.45 0.45 1.70%
Titan 838.70 748.40 90.30 12.07%
Zodiac JRD 13.94 12.60 1.34 10.63%
Suashish Diamonds 163.55 182.00 -18.45 -10.14%

NEW ZEALAND
Michael Hill NZD 0.62 NZD 0.55 NZD 0.07 12.73%

MINING STOCKS
(pence unless noted)
USA
Anglo American $11.59 $10.78 $0.81 7.51%
CANADA
Archangel CAD 0.08 CAD 0.05 CAD 0.03 60.00%
Harry Winston CAD 6.01 CAD 5.00 CAD 1.01 20.20%
Mountain Province CAD 1.65 CAD 1.28 CAD 0.37 28.91%
Peregrine Diamonds CAD 0.65 CAD 0.59 CAD 0.06 10.17%
Rockwell Diamonds CAD 0.07 CAD 0.06 CAD 0.01 16.67%
Shore Gold CAD 0.41 CAD 0.43 -CAD 0.02 -4.65%
Stornoway Diamond CAD 0.17 CAD 0.17 CAD 0.00 0.00%
True North Gems CAD 0.09 CAD 0.09 CAD 0.00 0.00%
UK (pence)
African Diamonds 31.0 22.7 8.3 36.62%
BHP Billiton 1,513.0 1,424.0 89.0 6.25%
Firestone Diamonds 29.3 27.5 1.9 6.81%
Gem Diamonds 129.5 125.5 4.0 3.19%
Gemfields 4.3 4.3 0.0 0.00%
Mano River 4.0 4.0 0.0 0.50%
Mwana Africa 6.7 5.9 0.8 14.12%
Namakwa Diamonds 32.3 26.0 6.3 24.04%
Petra Diamonds 59.5 47.5 12.0 25.26%
Rio Tinto plc 3,019.0 2,774.5 244.5 8.81%

Rapaport TradeWire - Friday, May 15, 2009
News: Caution -- large supplies of Zimbabwean rough and resultant polished being offered at 20% or greater discounts in India. Labs have been over grading these stones due to green hue. Polished prices relatively stable as diminished production reduces supply. Consistent demand for 0.50-2.00ct. engagement rings firming prices for corresponding rough. DTC May sight estimated at $250 mil. Dealers preparing for June, Vegas and Hong Kong, shows but keeping expectations low. Indian market on vacation until June. Sothebys Geneva brings $35.8 mil., (77% by lot) with 7.03 ct., fancy vivid blue, IF, Cushion selling for $9.5 mil. ($1.4 mil./ct.). Christie’s Geneva brings $19.6 mil. (66% by lot). Richemont FY profits -31% to $1.5 bil., sales +2% to $7.4 bil., jewelry sales +4% to $3.8 bil. Bulgari 1Q sales -23% to $243.3 mil., net loss of $40 mil. U.S. March polished imports -53% to $837.2 mil., polished exports -42% to $727.4 mil. Belgium April polished exports -46% to $599.4 mil., rough imports -58% to $399 mil. Israel April polished exports -28% to $269.1 mil., total diamond imports – 62% to $302.3 mil.

ANNOUNCEMENTS:

RAPAPORT BREAKFAST AT JCK VEGAS

Monday, June 1, 2009
Venetian Hotel - San Polo Ballroom (Level 3)

"State of the Diamond Industry" by Martin Rapaport,
8:00-10:00 a.m.

Bankers Conference,
11:30 a.m. - 12:30 p.m.

Fair Trade Jewelry Conference,
1:00 - 4:30 p.m.

RSVP: conference@diamonds.net
Limited Seating. Reserve your space now!

For Additional Rapaport JCK information visit
http://www.diamonds.net/Events/

Rapaport International Diamond Conference
New York City - September 10, 2009

Save the Date
Reserve your space early. Email IDC@diamonds.net

RAPAPORT INDIA – CAREER OPPPORTUNITY

Energetic motivated assistant manager
with diamond industry experience and excellent references.
University-educated with fluent English, Gujrati and computer skills.
Resume to: career.India@rapaport.com

RAPAPORT TENDER IN NEW YORK

Pawn Shop Tender – By Appointment Only
June 8-11, 2009

Over 40,000cts of Melee, Rounds and Fancies, -2.5 sieve to 1ct+
from promotional to very fine qualities.
Excellent opportunity for diamond and jewelry
manufacturers specializing in inexpensive diamonds.

Contact Myles Schakler at NYTender@diamonds.net
or +1-212-354-9800

RETAIL QUOTE:

"The China market is growing fast. Beside the global downturn, which affects every country, China is quite stable....Definitively, we are optimistic....We know Chinese consumers will continue to spend on luxury items. After all, it is a very big pond and in it there is space for many."

Michele Norsa
Chief Executive of Salvatore Ferragamo Italia

World News:

7.03ct Blue Diamond Sells for More Than $1M per Carat

Sotheby’s sale of a 7.03-carat, fancy vivid blue, flawless cushion-shaped diamond fetched almost $9.5 million, or $1,349,752 per carat in Geneva. The winning bidder wished to remain anonymous. Sothebys noted that this blue diamond beat out the previous most expensive fancy vivid blue diamond sold at auction, and that the sale was a world record for the sale of any diamond at auction in terms of value per carat. Sothebys total sale of magnificent jewels in Geneva was $35,762,327 and was 76.9 percent sold by lot.

U.S. Dpt. Store Sales Plunge 6%

U.S. department store sales fell 6.1 percent in April 2009 compared with one year ago, to $15.9 billion. The National Retail Federation (NRF) issued a statement saying that U.S. consumers need more proof that the economy is turning around before they will really start discretionary spending again.

U.S. Weekly Chain Store Sales Rise Slightly

Chain store sales in the U.S. rose 0.5 percent for the week that ended May 9, 2009, according to the International Council of Shopping Centers (ICSC) and Goldman Sachs, the first time since early December 2008 that the figure was positive. ICSC Research anticipates that May sales will be flat to down 1 percent, due in part to tax rebates that were disbursed and spent in May 2008.

DTC May Sight Estimated at $250M

The Diamond Trading Companys (DTC) May sight held an estimated value of $250 million. The sight was 25 percent higher than the March/April sight estimate, but still 62 percent lower than one year ago. DTC 2009 sales are expected to fall by about 50 percent, as reflected in the 2009 ITOs. Sales have fallen 73 percent in the first four sights of the calendar year to $660 million. With demand more apparent for certain items, DTC is exploring avenues for allowing sightholders to capitalize on changing trends, such as making goods that are not in the ITOs available to sightholders.

Chinas Jewelry Exports +4% in 08

Chinas jewelry exports saw a growth of 4 percent in 2008, in contrast with 17 percent growth in 2007, due to the faltering demand overseas. But sales of jewelry in China are expected top $26.2 billion by 2010, according to the Gems & Jewelry Trade Association of China, as China has become the biggest emerald, jade, pearl and platinum jewelry consumer in the world. China consumed 760,000 ounces of platinum in 2008 — 68 percent of the worlds total demand — and 400 tons of gold.

U.S. Myanmar Ruby Ban Hurts Thailands Gem Sector

The U.S. Tom Lantos Block Burmese JADE Act, which bans exports that bear Burmese gemstones, is having a negative impact on the Thai jewelry sector. The U.S. is currently one of the largest importers of Thai gems and jewelry, accounting for between 13 and 25 percent of exports during the past three years. The U.S. law hasled to a 40 percent year-on-year plunge in Thai exports in the first quarter of 2009. Up to 100,000 people have lost their jobs in the sector. The Thai foreign ministry and the Thai Gem & Jewellery Traders Association (TGJTA) are attempting to negotiate a review of the law.

Zimbabwe Working on New Strategy for Diamonds

The government of Zimbabwe is developing a model for exploiting the controversial Marange diamonds profitably and to prevent them from being banned from the world market. The government plans to identify investors to partner with the poorly equipped Zimbabwe Mining Development Corporation (ZMDC) in Marange. The government seems unaware of the obstacle posed by African Consolidated Resources PLC, a British company that says it has valid legal title to mining claims on nearly all of the land of the Marange diamond fields.

Rapaport Weekly Broadcast

See the big, bold, beautiful 7.03-carat blue diamond that sold this week at Sothebys Geneva for almost $9.5 million. The Diamond Trading Companys May sight has now passed us, but the estimated value of goods did not indicate that much in the way of robust sightholder trading is taking place before the JCK Vegas Show.

http://www.diamonds.net/news/NewsItem.aspx?ArticleID=26365

Diamond Stats:

Belgium April
April % Change YTD 2009 % Change
($ Mil) from 08 ($ Mil) from 08
Polished Exports $599 -46% $2,600 -38%
Polished Imports $669 -43% $2,600 -39%
Net Polished $(69) -13% $45 -7%

Rough Imports $399 -58% $1,600 -59%
Rough Exports $610 -37% $1,700 -58%
Net Rough $(211) N/A $(118) -39%

Net Diamond Acct. $142 $162 -33%

U.S. March
March % Change YTD 2009 % Change
($ Mil) from 08 ($ Mil) from 08
Polished Imports $837 -53% $2,400 -52%
Polished Exports $727 -42% $2,000 -44%
Net Polished $110 -79% $371 -72%

Rough Imports $19 -69% $39 -81%
Rough Exports $11 -73% $31 -75%
Net Rough $8 -62% $8 -74%

Net Diamond Acct. $118 -78% $379 -74%

Hong Kongs Mar. Net Polished Imports $122M

Hong Kongs polished imports for March were $825.6 million. Net polished imports — polished imports less polished exports and re-exports — came to $122 million. Rough imports totaled $59.3 million in March, and rough exports were $47.8 million.

Israel’s April Polished Exports -28%

Israel’s polished diamond exports fell 28 percent to $269.1 million in April. Rough exports dropped 59 percent to $108.3 million, for total combined rough and polished exports of $377.4 million, a fall of 41 percent. Total combined rough and polished imports declined 62 percent to $302.3 million. Israel’s April net diamond account, total diamond exports less imports, was $75.1 million, compared with a deficit of $146.5 million in 2008. For the year to date, polished exports decreased 52 percent to $1.2 billion, and rough exports dropped 68 percent to $435.3 million. Total exports fell 58 percent to $1.6 billion, and total imports declined 69 percent to $992.1 million. Israel’s year-to-date net diamond account fell 11 percent to $649.4 million.

Retail & Wholesale News:

Richemont FY Profits -31%, Sales +2%

Richemont net profit for the fiscal year that ended March 31, 2009, fell 31 percent to $1.5 billion. Sales rose 2 percent to $7.4 billion. The company’s jewelry group, which includes Cartier and Van Cleef & Arpels, was the only segment to register an increase in operating profits, up 2 percent to $1.1 billion. Jewelry sales rose 4 percent to $3.8 billion.

Bulgari 1Q Sales -23%, Loss Totals $40M

Bulgari Group reported first-quarter sales fell 23 percent to $243.3 million. The retailer posted a net loss of $40 million compared with a net profit of $31.1 million one year ago. Bulgari’s jewelry sales declined 15 percent to $108.9 million, a drop of 23 percent at fixed exchanged rates. Declines were experienced in all geographic locations.

Macys 1Q Loss Widens to $88M

Macys reported a loss of $88 million during its first quarter, or 21 cents per diluted share, compared with a loss of $59 million one year ago. Macys took $138 million in restructuring charges during the quarter. The retailer reported earlier this month that sales fell 9.5 percent to $5.2 billion during the first quarter, and that same-store sales dropped 9 percent. Online sales were the bright spot, rising 16 percent.

Zodiac 4Q Sales +31%

Zodiac-JRD-MKJ Limited reported that its net sales grew 31 percent to $1.2 million during its fourth fiscal quarter that ended March 31, 2009. Net profits for the period rose 177 percent to $111,497. For the full fiscal year, Zodiacs sales were up 49 percent to $3.6 million, while net profits grew 12 percent to $240,820.

Swank 1Q Sales -3%, Sets Up Office in China

Net sales at Swank fell 3 percent to $24 million during its first quarter. The company had a net loss of $279,000, although this was an improvement from a loss of $411,000 reported one year ago. Sales of mens jewelry and luxury leather goods collections were particularily hard hit. Swank recently set up a representative office in China to give it a stronger Asian presence, in an attempt to position the company well for an eventual economic recovery.

DGSE 1Q Profit -65%, Revenue -20%

DGSE Companies reported that its profit fell 65 percent to $166,040 during its first quarter of fiscal 2009 as revenue fell 19.5 percent to $25.9 million. During the quarter, DGSE launched a new website for its pawnshops at www.npawn.com, and after the company discontinued its live auction segment it took steps to integrate the remaining Superior Galleries operations with DGSEs existing activities.

QVC 1Q Jewelry Sales Down, Total Revenue -10%

QVCs first-quarter revenue was down 10 percent to $1.6 billion. In the U.S., QVCs revenue fell 10 percent to $1.1 billion. The proportion of products sold shifted away from the jewelry category to home products and, to a lesser extent, accessories. QVC.com sales grew to 28 percent of total U.S. sales in the first quarter of 2009, from 24 percent in 2008. QVCs international revenue declined 8 percent to $540 million.

HSN Finds That Self-Improvement is In, Luxury is Out

Home shopping company HSN Inc. found that consumers have shifted away from luxury items and are focusing on self-improvement. HSN sales in its core television shopping division were nearly flat at $474.9 million, but that what HSN customers, almost all of them women, are seeking now is products they can use to improve themselves, that they can use with their families or that can save them money. Anything carrying a whiff of selfish indulgence is not selling well. Sales fell 22 percent to $154.7 million at HSNs catalog business.

Giorgio Armani 08 Jewelry Sales Flat

Giorgio Armanis sales increased 1.5 percent to $2.16 billion in 2008. The company didnt disclose its profit for the year. Sales growth was particularly strong in mainland China, where revenue increased 30 percent. By contrast, revenue in Japan declined 4 percent. Sales of cosmetics, jewelry and watches remained flat.

Christies Geneva Jewels Sale Tops $19M, 66% Sold by Lot

Christies Geneva sale of jewels totaled $19,586,628 and was 66 percent sold by lot. The four top lots, all diamonds, sold for more than $1 million each. The top lot was a rectangular-cut, 30.52-carat, D, flawless diamond, which sold for almost $3,173,394, or $104,000 per carat.

Shane Co. Granted Extension to File Turnaround Plan

Bankruptcy court gave Shane Co. a three-month extension, allowing the retailer until August 10, 2009, to file a restructuring plan. If Shane fails to do so, creditors will be able to file competing reorganization plans for the company. Shane was given permission to close three stores in Florida, Georgia and Washington.

Fortunoff IP Auction Includes Jewelry Designs, Customer Data

CONSOR will be auctioning Fortunoffs intellectual property assets on June 18, 2009. The bidding deadline is June 16, and a sale approval court hearing is scheduled for June 22. The Fortunoff asset portfolio includes customer databases containing more than 750,000 names, many of which offer detailed purchase history for jewelry and other items. More than 3,500 exclusive jewelry designs, including the Petra, House 533, House 511, House 513 and Avignon branded Swiss watch collections will be available for bid.

Bank Forecloses on Clarks, Jeweler Files Chpt. 11

Clark’s Fine Jewelry of Wichita, Kansas, filed chapter 11 bankruptcy, with $1.6 million in assets and more than $1 million in liabilities. In April, Legacy Bank filed to foreclose on Clarks, claiming that payment had stopped on the $331,000 mortgage on the jewelers building. The Kansas Department of Revenue and the Internal Revenue Service (IRS) have also claimed unpaid taxes. Clarks will continue to stay in business.

Adylon Diamonds Adds Brick-and-Mortar Store

Adylon Diamonds & Bridal Jewelry opened a showroom in Burbank, California. While Adylons focus has been on online sales through adylon.com, the new store allows online customers to inspect diamonds in person. Adylon expects to expand into similar small showrooms in the greater Los Angeles area in coming years. The Burbank showroom offers lifetime upgrade policies, free ring sizing and free cleaning.

Two Class Action Suits Filed Against Bidz.com

Two legal firms, the law offices of Howard G. Smith and Barrack, Rodos & Bacine, have filed separate class-action lawsuits against auction website Bidz.com for securities fraud. On behalf of those who purchased common stock of Bidz.com (BIDZ) between August 13 and November 26, 2007, the two firms allege that Bidz.com inflated the price of its stock by issuing misleading statements that disguised the companys problems. Attorneys for Bidz.com contend that the plaintiffs allegations are without merit, as they are based on a November 2007 report by Citron Research, which has since admitted that it held a short position in Bidz.com stock at the time of the report.

April Abu Dhabi Gold Sales +25%

The volume of retail gold jewelry sales rose 25 to 30 percent in Abu Dhabi in April, as lower prices and the Indian wedding season brought buyers back to the market, after sales volumes of jewelry and gold bars dropped 20 percent in the first quarter of 2009. Indians are among the largest groups of expatriates in the United Arab Emirates (UAE). Abu Dhabi has about 85 gold shops and its own jewelry manufacturers. Imports, however, make up almost 60 percent of all jewelry sold at retail outlets there.

Akshaya Tritiya Gold Demand -8% But Sales +14%

Gold demand in India fell by 8 percent to 45 metric tons (49.6 tons) during Akshaya Tritiya, compared with 48.9 metric tons (53.9 tons) one year ago. In value terms, Akshaya Tritiya — April 27, 2009 — witnessed 14 percent increase in sales, from $1.3 billion (INR 63.6 billion) in 2008 to $1.5 billion (INR 72.8 billion) in 2009, mainly because prices were higher this year.

Highlights of Christies Hong Kong Jewels Sale

Christie’s Hong Kong will hold its magnificent jewels sale on May 26, 2009. Leading the sale is a 20.70-carat, D, flawless diamond pendant, mounted with a 10.07-carat, pear-shaped, D, internally flawless diamond. Both stones are type IIa. Christies will also auction a suite of 56 colored diamonds in a range of hues, certified as fancy deep, vivid and intense pink, blue, yellow and green, of 14.67 total carat weight, with a presale estimate of between $1.35 million and $1.9 million.

Jetter Taps Nature for a Luxurious Opal Collection

Gemologist and jewelry designer Katherine Jetter will introduce what she calls the "first luxury Australian opal jewelry brand" during the Couture Show in Las Vegas. Jetter’s signature Daintree Rainforest Collection was inspired by the natural landscapes of Australia, where most of the worlds opals are found. Jetter maintains a profound passion for the preservation of earth and its wildlife. Packaging for the brand uses ecofriendly, recyclable materials, and 5 percent of all sales proceeds benefit rainforest conservation funds.

Equss Jewellery to Open in Dubai

Australian fashion jewelry brand Equss Jewellery plans to open a flagship outlet at Sunset Mall in Dubai. Sunset Mall, whose soft launch is scheduled for September 2009, will host 97 outlets with a strong retail mix, including high couture boutiques and concept stores.

More Job Cuts At Birks & Mayors

Birks & Mayors has eliminated another 73 full-time staff positions as part of a strategic cost-saving exercise, that will save the company approximately $2.5 million a year. Since the beginning of 2009, Birks & Mayors has eliminated 150 positions, or 15 percent of its workforce. Combined with salary reductions, the job cuts are expected to reduce the company’s operating expenses by $9.5 million annually.

Luxury Brands Look to China Amid Global Crisis

High-end designers and luxury retailers are looking to well-heeled Chinese shoppers to drive sales as demand in other countries collapses. Just as more mainstream brands are expanding fast in China, brands such as Salvatore Ferragamo and Gucci are adding stores there. Chinas $8 billion luxury market accounts for just 3 percent of global sales, but China and Brazil are projected to be the two fastest-growing luxury markets for the five years through 2012, according Bain & Co. Chinas sales of designer clothing, jewelry and other goods will climb 7 percent this year while the industrys worldwide revenue could fall 10 percent. Luxury sales in China surged 25 percent in 2008 while global growth was flat.

Gemfields Appoints Banks as Product Director

Gemfields Resources appointed Adrian Banks as product director to manage the companys rough supply chain, including grading, quality assurance, trading and sales systems. Banks will serve as Gemfields key customer interface for rough gemstone trading and sales, and will report to the board of directors. Previously, Banks spent a decade with TanzaniteOne, where he was instrumental in developing a shareholder system.

Simon Golub & Sons to Distribute Hot Diamonds Brands in U.S.

Simon Golub & Sons was given exclusive rights to import and distribute U.K.-based Hot Diamonds jewelry brands in the U.S. Inventory and operations will be handled out of Simon Golub & Sons home office in Seattle, Washington, beginning June 1, 2009.

Mendis, Luma Partner to Create ML Fine Jewelry

Mendis International, a spirits company, and gemologist Jean Luma are creating a fine jewelry collection under the brand name ML. Lumas design house, Luxe Coterie, will be creating customized jewelry under the ML name, which will be paired with bottles of a limited run of Mendis Coconut Brandy.

Capital Grace Orders $4M in Diamond Jewelry from Kanani

Capital Grace of Hong Kong has awarded an order for supplies of diamond jewelry worth $3.96 million to Kanani Industries. Kanani will deliver the jewelry within eight months of the date of the purchase order. The company will manufacture the jewelry at its new factory in the Special Economic Zone at Surat in Gujarat.

ThePlunge.com Targets Future Grooms

XY Internet, the owner of RingTutor.com, has launched a new website called ThePlunge.com, to fill the need for a wedding planning website targeted toward grooms. ThePlunge.com offers men advice for getting engaged and choosing a diamond ring, as well as tips for planning the wedding, the honeymoon and the bachelor party. The website has a blog, community forum and an "ask the expert" column.

General News:

Paris Police Capture Two Alleged Pink Panther Members

Two Serbs, 36-year-old Nicolai Ivanovic and 38-year-old Zoran Kostic, were arrested in the Pigalle entertainment district of Paris, and are alleged to be members of the "Pink Panther" gang of international jewel thieves. They are being held for carrying false identity documents, but are expected to face charges related to the Pink Panthers series of crimes, in which they stole jewels worth a total of at least $140 million.

Feds are Sole Owners of Giant Gem

A federal judge in Akron, Ohio, has ruled that the 43.51-carat yellow Golden Eye diamond seized more than two years ago in a local FBI sting belongs solely to the U.S. government. Ownership claims by several parties were rejected. The diamond, worth $15 million according to its previous owner, will be sold at auction, with the money raised going to law enforcement agencies involved in the investigation.

Robbers Snatch $1M in Goods from Gioia Galleria

Police say two robbers snatched a pair of diamond earrings and a diamond ring worth a total of more than $1 million on May 7, 2009, from Gioia Galleria in New York while security guards were at lunch. Investigators say that Rafaela Amini, the stores co-owner, buzzed the robbers into the store, whereupon they doused her with pepper spray, knocked her to the ground and kicked her in the head. She was treated at a hospital and released. Police have made no arrests.

New Name, Logo for London Diamond Bourse & Club

The London Diamond Bourse & Club has changed its name to the London Diamond Bourse. The bourse has adopted a new logo and will soon launch a new website.

ICA Congress Attracts Record Crowd

The International Colored Gemstone Association (ICA) Congress closed its doors Sunday evening after a six-day event in the city of Panyu, China. The attendance was the largest in ICA’s history, with 200 overseas delegates from 26 countries and more than 750 local Chinese participants. Much of the discussion revolved around a project for the standardization of colored gemstones in China.

Sarin Technologies 1Q Revenues -90%, Records Loss

Sarin Technologies revenues fell 90 percent compared with 2008, to $1.1 million, for the three months that ended March 31, 2009. The maker of tools for the diamond industry reported a net loss of $2.5 million, compared with profits of $2 million a year earlier. Sarin reported that revenues from its biggest market, India, fell 91 percent to $720,000.

Antwerp Diamond Bourse Tenants Appeal for Rent Reduction

The tenants of Antwerps diamond bourse, facing increasingly difficult economic times in the sector, have submitted a petition to their board of directors in order to reduce the rent of their offices. They have been repeatedly refused dialogue with the board of directors, and so were forced to put their demands to a vote at the annual general assembly on May 12. Results of that meeting have not yet been reported.

Diamond Mining:

Russia Stockpiles Gems

ALROSA has not sold rough on the open market since December, stockpiling them instead. In an attempt to carefully re-enter the global market without forcing prices still lower, Russia is relying on two things: the Gokhran precious gem depository will buy up ALROSA rough, and investors, whom the company hopes will buy rough diamonds as an investment. ALROSA is seeking to jump-start demand by selling gems under long-term contracts to wholesalers in Belgium, Israel, India and elsewhere. Six of these contracts have been signed, with prices set at a midpoint between the peak last August and the low point in the first quarter of 2009, and fixed for a period of several years.

Petra Diamonds Responds to Cruel Fate of Miners Story

Petra Diamonds responded to a news story concerning workers at its Cullinan diamond mine that was published in the U.K.s Observer, saying that it contained many inaccurate statements. The Observer article quoted miners and union representatives saying that race relations were poor at the mine and that the white supervisors pay black workers up to $1,184.06 (ZAR 10,000) less per month than white workers doing the same job. The story claimed that the 7.03-carat blue diamond that sold recently in Geneva for $9.5 million was probably discovered by a diamond sorter paid only $710.44 (ZAR 6,000) a month, as opposed to salaries of $3,552.19 (ZAR 30,000) for controllers. Petra responded that its hiring practices adhere to the highest ethical standards. The blue diamond sold in Geneva was not recovered by an individual mineworker, the company contended, but was recovered in the normal course of the mining and recovery plant process, which is mostly automated.

Pangea DiamondFields Bakerville Tender Worth $240K

Pangea DiamondFields generated $239,776 at the second diamond tender from its Bakerville project in South Africa. The tender sold 1,016 carats at an average $236 per carat, well below the average price achieved to date from the project. The first tender of diamonds from the project held in July 2008 achieved an average price of $1,448 per carat. Pilot mining on the project began in November.

Saad Denies Kopane Merger Rumor

Saad Investments, the majority shareholder in Petra Diamonds, denied it was bidding for ownership of Kopane Diamond Developments. London press reported that Saad was to have made a takeover offer of 22 pence a share for the nearly 30 percent of Kopane that is owned by Obtala Resources, after which it will bid for the whole company. Obtala week raised its stake in Kopane to 29.75 percent, which it has agreed to sell to Saad, the London Times wrote. Saad Investments has dismissed the report, however, saying it has no interest in buying Kopane.

Diamonds North Finds Gold on Amaruk

Diamonds North Resources identified gold mineralization on its Amaruk property in Nunavut, Canada, following the companys recent finding of a new diamond district and a nickel prospect at Amaruk. A reconnaissance sample on the claim yielded 5.8 grams of gold per metric ton. Exploration plans will continue in conjunction with other metal opportunities on Amaruk.

Econ Watch:

For the week ending May 14, 2009

May. 14 May. 7 Chng.
$1 = Euro 0.730 0.746 -0.016
$1 = Rupee 49.6 49.1 0.5
$1 = Israel Shekel 4.13 4.12 0.01
$1 = Rand 8.54 8.41 0.13
$1 = Canadian Dollar 1.17 1.16 0.01

Precious Metals
Gold $925.70 $910.50 $15.20
Platinum $1,111.00 $1,145.00 -$34.00

Stock Indexes Chng.
BSE 11,872.91 12,116.94 -244.03 -2.01%
Dow Jones Avg. 8,330.37 8,409.70 -79.33 -0.94%
FTSE 4,362.58 4,398.68 -36.10 -0.82%
Hang Seng 16,541.69 17,217.89 -676.20 -3.93%
S & P 500 893.03 907.36 -14.33 -1.58%
Yahoo! Jewelry Index 690.73 764.25 -73.52 -9.62%

USA
Birks & Mayors $0.46 $0.46 $0.00 0.00%
Blue Nile $42.18 $44.61 -$2.43 -5.45%
Charles & Colvard $0.52 $0.44 $0.08 18.18%
DGSE Companies, Inc. $1.00 $1.00 $0.00 0.00%
Fuqi International $6.49 $7.34 -$0.85 -11.58%
JCPenney $26.59 $30.04 -$3.45 -11.48%
Kohls $41.39 $44.29 -$2.90 -6.55%
Lazare Kaplan $1.88 $1.60 $0.28 17.50%
LJ International $1.26 $1.36 -$0.10 -7.35%
Macys $11.30 $12.81 -$1.51 -11.79%
Man Sang $2.15 $2.21 -$0.06 -2.71%
Movado Group $7.21 $8.76 -$1.55 -17.69%
Nordstrom $20.88 $23.31 -$2.43 -10.42%
Saks $3.58 $4.41 -$0.83 -18.82%
Signet $16.11 $17.56 -$1.45 -8.26%
Sothebys $10.62 $11.99 -$1.37 -11.43%
Tiffany $25.44 $28.20 -$2.76 -9.79%
Wal-Mart $49.23 $49.85 -$0.62 -1.24%
Zale $3.08 $3.70 -$0.62 -16.76%

EUROPE
Bulgari €3.79 €4.10 -€0.31 -7.56%
Bijou Brigitte €89.99 €87.73 €2.26 2.58%
Esa €2.82 €2.88 -€0.06 -2.08%
Golay-Buchel CHF 1,500.00 CHF 1,365.00 CHF 135.00 9.89%
LVMH €57.38 €58.53 -€1.15 -1.96%
Pinault P-R SA €55.44 €60.92 -€5.48 -9.00%
Richemont SA CHF 22.00 CHF 22.38 -CHF 0.38 -1.70%
Swatch Group CHF 167.50 CHF 177.40 -CHF 9.90 -5.58%
Theo Fennell (pence) 19.00 16.70 €2.30 13.77%

INDIA (rupee)
Classic Diamond 12.38 13.00 -0.62 -4.77%
Gitanjali Gems 71.10 72.25 -1.15 -1.59%
Rajesh Exports 29.15 29.50 -0.35 -1.19%
Ren. Jewellery 27.65 26.00 1.65 6.35%
Su-Raj Diamonds 25.50 26.90 -1.40 -5.20%
Titan 868.20 838.70 29.50 3.52%
Zodiac JRD 13.50 13.94 -0.44 -3.16%
Suashish Diamonds 145.80 163.55 -17.75 -10.85%

NEW ZEALAND
Michael Hill NZD 0.62 NZD 0.62 NZD 0.00 0.00%

MINING STOCKS
(pence unless noted)
USA
Anglo American $11.15 $11.59 -$0.44 -3.80%
CANADA
Archangel CAD 0.05 CAD 0.08 -CAD 0.03 -37.50%
Harry Winston CAD 5.80 CAD 6.01 -CAD 0.21 -3.49%
Mountain Province CAD 1.55 CAD 1.65 -CAD 0.10 -6.06%
Peregrine Diamonds CAD 0.58 CAD 0.65 -CAD 0.07 -10.77%
Rockwell Diamonds CAD 0.06 CAD 0.07 -CAD 0.01 -14.29%
Shore Gold CAD 0.66 CAD 0.41 CAD 0.25 60.98%
Stornoway Diamond CAD 0.16 CAD 0.17 -CAD 0.01 -3.03%
True North Gems CAD 0.10 CAD 0.09 CAD 0.01 11.11%
UK (pence)
African Diamonds 28.5 31.0 -2.5 -8.13%
BHP Billiton 1,392.0 1,513.0 -121.0 -8.00%
Firestone Diamonds 37.8 29.3 8.5 28.88%
Gem Diamonds 181.8 129.5 52.3 40.35%
Gemfields 4.5 4.3 0.3 5.88%
Mano River 4.0 4.0 0.0 0.00%
Mwana Africa 6.1 6.7 -0.6 -9.09%
Namakwa Diamonds 32.8 32.3 0.5 1.55%
Petra Diamonds 46.5 59.5 -13.0 -21.85%
Rio Tinto plc 2,594.0 3,019.0 -425.0 -14.08%

India Market:

Rapaport TradeWire - Friday, June 19, 2009
News: Indian manufacturers pushing demand for rough as they resume manufacturing. Indians have also begun cutting Princess shapes after a long break. Diamond jewelry sales improving in U.S. Higher prices of 10% to 15% reported at BHP Billiton rough tender. DTC June sight estimated at $425 mil. Christie’s New York brings $11.4 mil. (91% by lot), with pear-shaped fancy intense 6.29-carat blue, IF diamond selling for $3.6 mil. ($565,103/ct.). Finlay Enterprises 1Q sales +12% to $159.3 mil., net loss of $28.7 mil., vs loss of $11 mil. South Africa April diamond production -65%.

ANNOUNCEMENTS:

Rapaport International Diamond Conference
New York City - September 10, 2009

Save the Date
Reserve your space early. Email IDC@diamonds.net

Retail Quote:

"[Closing Halstons Fine Jewelry] was not planned, but we sat down and thought about it. We kind of want to go in a different direction. Our customers are really sad. That has made our decision even sadder. I had one lady who burst into tears on the phone. It has been a wonderful business, and I love it very much, but I am old enough to retire."

Gayle Kushner
Halstons Fine Jewelry, Port Orange, Florida

World News:

DTC June Sight Estimate $425M, High Demand Raises Questions

The Diamond Trading Company (DTC) June sight is estimated to have been the largest so far this year, at $425 million. The sight one year ago June was estimated at $700 million. While sightholders were clearly in the mood to buy rough goods, few could explain the surge in demand, as trends in the polished market remain weak. DTC June prices were relatively consistent with a month ago, with some adjustments on prices for smaller, lower-quality goods.

South Africas April Diamond Production -65%

South Africa’s diamond production fell 62 percent by volume in April 2009 compared with one year earlier. The country’s total mineral production for the month declined 11 percent, with gold production down 13 percent and non-gold production decreasing 10 percent, year on year.

U.S. Jewelry CPI +1% in May

The consumer price index (CPI) for jewelry in the U.S. rose 1.2 percent year-on-year to 154.72 points during the month of May. The index dropped almost 3.3 points from its reading in April. The monthly index is based upon a reference point of average prices in 1986, which is set at 100 points. For the watch and jewelry categories combined, the index for May inched 1.3 percent higher from one year ago to 147.5 points.

Weekly Chain Store Sales Drop More Than 1%

Weekly chain store sales in the U.S. dropped 1.5 percent for the week that ended June 13, 2009, according to the International Council of Shopping Centers (ICSC) and Goldman Sachs. ICSC noted that rising gasoline prices have pressured consumers to remain cautious on discretionary spending. For June, ICSC anticipates that sales will be down by about 5 percent, compared with the 4.6 percent decline in May.

Diamond News Broadcast

As the diamond pipeline continues to reinvent itself, given the steady drop in consumer demand, two Diamond Trading Company (DTC) sightholders in Canada have had to drastically reduce or end operations in the Northwest Territories. However, a third sightholder reports that this is a time of opportunity to grow. Dylan Dix, marketing director of Crossworks Manufacturing (SunDiamond), discusses his companys approach given this new industry era.

http://www.diamonds.net/news/NewsItem.aspx?ArticleID=26727

Retail & Wholesale:

Finlay 1Q Loss Deepens, Some Vendors Extend Grace Period

Inventory liquidation boosted Finlays first-quarter sales 12 percent to $159.3 million; however, the company reported a loss of $28.7 million, widened from a loss of $11 million. Department store sales increased 50 percent to $96.9 million, as Finlay continued to exit these store counters during the quarter. Specialty store sales fell 20 percent to $62.5 million. Finlay saw an operating loss at its standalone jewelry stores of $12.1 million in the first quarter, up from a loss of $1.3 million one year ago. Since Finlay decided to exit department stores and close nearly half its specialty stores, it expects to record between $10 million and $12 million for severance and retention costs, lease termination costs and other items this fiscal year. Once the companys strategic plan, which Finlay has vowed to complete this year, is implemented, sales of more than $750 million in 2008 will be reduced to fall somewhere between $150 million to $200 million on an annual basis.

Finlay stated that its revolving credit facility was reduced to $216.6 million. It has not met certain credit agreement targets, and lenders have thus imposed penalty interest rates. Some of those holding third lien notes on trade debt of about $25 million, entered into agreements with Finlay to a deferred payment schedule until October. Finlay has paid the first two scheduled installments, and three remain. In a seperate notice, Finlay announced it was seeking buyers for all or part of its assets.

Bulgari Increases Bond Offer to $208M

Bulgari hopes to raise $208.5 million (EUR 150 million) in an equity linked bond offering, increasing its initial estimate of $180 million (EUR 130 million). The bond offer was launched on June 10, 2009, with the option to increase if Goldman Sachs fully exercised its over-allotment option. Settlement and delivery of the bonds, which are due in 2014, will take place on or around July 8. Goldman Sachs upgraded its rating on Bulgari to "buy" from "sell" and lifted the share price target on the jeweler to EUR 4.70 from EUR 3.60.

Another Success for Christie’s NY

Christie’s New Yorks small, 184-lot, end of season sale on June 11 sold 91 percent by lot and 86 percent by value. The auction tallied up $11,367,875, with diamonds making a strong showing. The top lot — a pear-shaped fancy intense internally flawless 6.29-carat blue diamond — sold for $3,554,500. The highly touted blue diamonds were the stars of the show, with a 3.28-carat modified rectangular-cut fancy dark gray-blue diamond selling for $386,500, the fifth biggest lot. Two blue rose-cut diamonds, however, failed to sell.

Flawless Diamond Gets $2M Order

Flawless Diamond received two orders, expected to close within six months, worth a combined $2.3 million. The larger order, for $1.2 million, came from Hong Kong-based Malay Impex, and the other was from Dubai-based Madrid Impex for $1.1 million. Flawless also entered into a long-term marketing agreement, under which Malay Impex and Madrid Impex will market its diamond and jewelry products in their respective markets. Believing that the gold, diamond and jewelry markets have started to revive, the company has announced plans to aggressively pursue its export business.

The Forevermark Precious Collection Unveiled

Forevermark has unveiled the Forevermark Precious Collection™ in Japan. Forevermark invited a number of internationally renowned designers and a group of equally famous writers to createdesigns and write stories inspired by the word ‘precious.’ The Forevermark Precious Collection™ showcases these interpretations of ‘precious,’ both in Forevermark diamonds and in words.

New Look for Michael Hill Stores, U.S. Market Still Tough

In attempt to build its brand, Michael Hill is about to unveil two stores with a new look, in New Zealand next month. The new format has a subtle, European look, with "moody" lighting. Meanwhile, Michael Hill is fighting to keep its 17 new locations afloat in the U.S. given the new conservative consumer economy.

Peter Burrowes Launches New Website

London jeweler Peter Burrowes launched a new website in response to customers’ growing desire to buy watch and jewelry products online. Features of the e-commerce website, which sells a wide range of leading fashion watch and jewelry brands, include a company blog that provides fashion tips. A "reserve and pick up in shop service" will come online soon.

Industry Welcomes Proposed Parallel Trading Channel

Botswana is going ahead with plans to create a parallel trading platform alongside the Diamond Trading Company (DTC), a move that has been welcomed by many in the industry. Akolang Tombale, the head of the Botswana Diamond Hub, said the parallel platform will have two objectives: To liberalize diamond-price discovery and to have an input in the current DTC sightholder system.

JCOC Survey: Weddings Delayed, No Internet Love for Rings

The bridal study conducted by the Jewelry Consumer Opinion Council (JCOC), revealed that the economy is taking a toll on wedding plans. Even though the study only had 362 online participants, 25 percent said that the wedding plans had been postponed due to the recession. Of those grooms who had not yet purchased engagement and wedding rings, 36 percent said that their budget for the rings will now be lower by 15 percent or more. National jewelry stores topped grooms choices for ring purchases, with 43 percent, followed by local jewelry stores, with 36 percent, the Internet with 7 percent, and websites of chain retailers, with 7 percent. Of 30 surveyed brides-to-be, 48 percent had lowered their budget for rings due to the recession, 23 percent lowering it by 15 percent or more. The brides split between buying rings at national chains or from local jewelers, both at 29 percent. None of the brides would buy from the Internet; 3 percent, however, selected retail store websites.

Helzberg Diamonds Joins Jewelry.com

Helzberg Diamonds signed up as a diamond retail partner with jewelry.com. Jewelry.coms diamond partners already included Fred Meyer, Gordons, JCPenney, Kay Jewelers, Kohls, Littman Jewelers, Macys, Sears and Zales.

Stuckey Expands Distribution of The Brides Pendant to Online

Stuckey launched an e-commerce website for its The Brides Pendant collection, which was originally created in 2007 and initially distributed only through independent brick-and-mortar retailers. Stuckey also created a YouTube channel for The Brides Pendant, featuring comments from jewelers who sell the collection.

Hoover & Strong Merges with Keystone Findings

Hoover & Strong merged with Keystone Findings in order to broaden its product offerings. Keystones Telford, Pennsylvania, plant will be transported to Hoover & Strong’s Richmond, Virginia, facility during the coming weeks. Order fulfillment and customer service for both companies will remain fully operational during the transition period.

Gitanjali Forms JV with Damas, Sells Stake in Ivida

Gitanjali Lifestyle, a subsidiary of Gitanjali Gems, has set up a joint jewelry retail venture in India with Damas of Dubai. Damas received the necessary approval from Indias Foreign Investment Promotion Board on June 4. Gitanjali also sold its stake in Ivida Technologies due to poor performance. The company did not disclose the financial details of the sale.

Robbins Brothers to Hold Diamond Dig Promotion

Robbins Brothers, which recently emerged from bankruptcy reorganization, is running a "diamond dig" promotion through its southern California stores. Contestants who register at one of four Robbins Brothers locations between June 11 and 29 will dig between first and third bases after an Orange County Flyers baseball doubleheader at Cal State Fullertons Goodwin Field on July 5. Ten buried Robbins Brothers lighted ring boxes will contain gift certificates and diamond prizes, including one 0.5-carat solitaire ring. Registrants will be given a complimentary ticket to the game.

Damas Features Notturno During Shopping Festival

Damas Jewellery presented Utopias Notturno collection at its stores in Dubai especially for the summer shopping festival, which is underway and continues through August 14, 2009. Notturno, a collection of jewelry that blends white gold, diamonds and pearls, was inspired by the musical composition of the same name.

Denhams Jewelers Poised for Sparkling Future

Sarah Stamp, who previously owned half of Denhams in Leicester, U.K., has bought the rest of the business from James and Jane Jackson for an undisclosed sum. Stamp, who has worked at the company for 20 years, said that trade was booming despite the recession and that she plans to expand. Sales rose to about $820,000, a record, in the year that ended on March 31, 2009, and are on track to increase again this year.

OneWed Launches Ring Gallery, Platinum Ring Contest

Wedding vendor aggregator website OneWed.com introduced a wedding and engagement ring gallery with ring and diamond descriptions. The site also partnered with Platinum Guild International to offer a chance to win matching $4,500 Kirk Kara Platinum wedding bands. Brides-to-be must submit how they would or will pop the question. The contest ends July 15, 2009.

Fred Meyer Jewelers Joins RJC

Fred Meyer Jewelers joined the Responsible Jewellery Council (RJC), and affirmed its commitment to building a responsible supply chain. Fred Meyer Jewelers was founded in 1973, and currently has 400 stores across the U.S.

10% of Shopittome Users Would Splurge on Jewelry

An online survey conducted by Shopittome.com found that 49 percent of its registered users were spending less on clothing and accessories online this year, that 16 percent were spending more, and about one third were spending the same amount. Thirty-eight percent said they were not splurging on special items, but 10 percent reported that they would spending on jewelry.

Pure Gold Jewellers Celebrates 20 Years

To celebrate its 20th anniversary, United Arab Emirates (UAE)-based jewelry retailer Pure Gold Jewellers is running a promotion through August 14, 2009, in which customers who purchase diamond jewelry will get a discount scratch card. The discount listed on the card, ranging from 65 to 100 percent, is valid on those items already invoiced to the customer.

De Beers Expects Brighter Christmas

Speaking in Israel at the second of the company’s series of town hall meetings with the industry, Gareth Penny, De Beers managing director, observed that the diamond sector may be on its way out of the downturn, but with “great caution.” De Beers is expecting the Christmas season to be “in line with if not better than last year.” To weather the current slump, De Beers has taken a five-point approach and urged the industry to do the same: Confident leadership, a focus on cash management, acting swiftly to reduce overhead costs, a focus on core business activity and solidifying partnerships with customers.

Who is News:

Cyanide Suspected in Jewelry Store Death

Sushil Bhalla, 46, of Edison, New Jersey, died June 15 in his jewelry store, Aabhushan Family Jewelers, possibly overcome from the cyanide he was using to work on jewelry. Authorities discovered a small bucket of cyanide, but were uncertain if Bhalla died from exposure to the chemical or had a heart attack.

Southfield Jeweler Pleads Guilty to Money Laundering

Gary Yee, who operated Golden Sun Jewelry in Southfield, Michigan, pleaded guilty to a money laundering charge on June 16, 2009, and agreed to forfeit $1 million. The U.S. Department of Justice for the Eastern District of Michigan reported that Yee laundered more than $1.5 million in cash for narcotics traffickers, including notorious Detroit dealers and criminals from as far away as Arizona.

Man Pleads Not Guilty to Jewel Heist Death

Marion Pegese of Pennsylvania pleaded not guilty to a charge of second-degree murder and 18 charges of robbery for his involvement in a $1 million jewelry store heist that left two dead. Pegese was allegedly one of four men who robbed a New Hartford jewelry store in February 2006. While fleeing with jewelry and diamonds, the robbers fatally shot central New York police officer Joseph Corr in the neck. The shooter was killed in the ensuing shootout. One of the other accomplices has been sentenced to 300 years and the other is due to be charged.

New Boards Elected at Tokyo and Italian Bourses

Two members of the World Federation of Diamond Bourses (WFDB) — the Tokyo Diamond Exchange (TDE) and the Borsa Diamanti DItalia (BDI) — have voted in new boards. TDE elected Michio Iwasakia a senior director of the Jewellers Association of Japan (JJA) and chair of the JJAs Public Information Commission, as its new president. Ernesto Colombi, the longtime president of BDI, was elected to serve another term.

Taylor to Take the Stand July 13

The defense case of Charles Taylor, former President of Liberia, will open before the Special Court for Sierra Leone on July 13. Taylor is expected to be the first witness to take the stand. His defense was initially set to start on June 29, but the date was challenged by Taylors lawyers, who said they would not be ready. In January, the 91st and final prosecution witness in Taylors trial told judges how he had pleaded with rebels to cut off his remaining hand so they would spare his toddler son.

General:

Security Survey Reveals Increase in Retail Shrinkage

Retail shrinkage — inventory loss due to theft, fraud or paperwork error — increased in 2008 to 1.52 percent of retail sales, according to the National Retail Federations (NRF) latest annual security survey, up from 1.44 percent in 2007. Total retail losses increased to $36.5 billion, up from $34.8 billion. The majority was due to employee theft, which accounted for total losses of $15.9 billion; 14 percent of those cases involved collusion with outsiders. Shoplifting accounted for $12.7 billion. Ninety-two percent of retailers noted that they had been victims of organized retail crime rings in 2008, and 73 percent said that the problem is worsening.

GJEPC Plans India Diamond & ColourStone Show

The Gem & Jewellery Export Promotion Council (GJEPC) has organized a business-to-business event called the India Diamond & Colourstone Show, which will be held August 4 and 5, 2009, in Mumbai, as a lead-in to the 26th annual India International Jewellery Show (IIJS) that begins August 6. The show will provide buyers with an exclusive opportunity to source loose stones. Buyers will be permitted to place orders, but direct cash-and-carry sales will not be permitted.

FACETS Show Brings Exhibitors to Sri Lanka

The 19th annual FACETS international gem and jewelry exhibition, which will be held this September in Colombo, Sri Lanka, has already confirmed buyers from China, Russia, Thailand, India and Hong Kong, and exhibitors from China, India and Myanmar. The exhibition is a chance for Sri Lankas gem and jewelry industry to build relationships with these buyers from abroad.

AGS Updates Altobellis Appraisal Book

The American Gem Society (AGS) has published an updated third edition of The Practical Guide to Jewelry Appraising, appraisal expert Cosmo Altobelli’s book. The new edition features new and updated resource websites, sample letters and forms, metal pricing charts, gemstone weight estimation charts and information on cut grades from both the AGS and Gemological Institute of America (GIA). The book costs $69.

WFDB To Hold 2009 Asia Summit

The World Federation of Diamond Bourses (WFDB) will hold a special 2009 WFDB Asia Summit Meeting on June 29. The aim is to involve the bourses in Bangkok, Hong Kong, Mumbai, Singapore, Shanghai and Tokyo more intensively in the activities of the WFDB, and to determine which services the bourses need most from the umbrella organization and what assistance these bourses can extend in turn to WFDB members worldwide. The summit meeting will be hosted by the Diamond Federation of Hong Kong.

Surat Diamond Units Hunt for Talent

Surat Diamond firms, searching for skilled manpower, have been conducting campus interviews at the Indian Diamond Institute (IDI) in Katargam. K. G. Kothari & Sons of Mumbai interviewed 22 production students and added 14 to a short list for a second interview. Sheetal Creations and Kiran Jewellers, both from Sachin, interviewed a total of 30 candidates for a design position. Sachin-based Gunjan Export wanted diamond grading specialists.

EGL Asia Signs Agreement with Chinas 21Gem.com

EGL Asia and 21Gem.com announced an agreement at the Hong Kong Jewelry and Watch Fair, under which EGL Asia will be the exclusive grader and provider of certificates for loose diamonds and diamond-set jewelry sold on the 21Gem.com website. 21Gem.com plays a leading role in Chinas online diamond and jewelry retail sector, selling either directly to customers or through designated stores. EGL Asia is one of the best-known gemological laboratories in Hong Kong.

Diamond Mining:

Archangel 08 Loss +72% to $9M, 1Q Loss Improves

Archangel Diamond Corporation, in its long-delayed financial results for the year 2008, stated that its assets dropped 36 percent to $700,891 and liabilities rose more than 252 percent to $11.7 million. The mining companys net loss for 2008 rose 72 percent to $8.8 million. Archangel also filed first-quarter results, which showed a loss of $703,658, down from a loss of almost $2 million one year earlier, and cash on hand of $29,607, down from $1 million a year ago. The mining company stated that its ability to continue as going concern is contingent upon shareholder support and its ability to raise more cash. A private placement of $13.75 million that was announced on June 4 fell through.

ALROSA-Nyurba Pays Parent Company Smaller Dividend

ALROSA-Nyurba will pay ALROSA, its parent company, $59.1 million in dividends for 2008. The companys shareholders voted at their annual general meeting to pay $16.05 per share, or a total of $12.8 million, to shareholders for the fourth quarter of 2008, on top of the $54.6 million in interim dividends that were paid for the nine months that ended September 30. ALROSA-Nyurba paid $89.9 million in dividends for 2007. ALROSA owns 88.28 percent of ALROSA-Nyurba.

African Diamonds Reaffirms Plans for AK6

African Diamonds supports its long-held belief that it can mine the AK6 project cheaper than De Beers, its partner in the joint venture. African Diamonds has proposed development of the mine at $50 million initially, followed by $35 million, to yield 800,000 carats per year. If De Beers, which African Diamonds has accused of unnecessarily delaying the project after it struggled to raise funds to develop AK6 as a $320 million mine, declines to proceed with the project, African Diamonds says it will offer to take over 100 percent control.

Firestone Diamonds to Commission New Plant

Firestone Diamonds will commission its $7.5 million plant at the Bk11 project near Orapa by the end of this month, and the mining company is putting all its resources behind its BK11 diamond project in order to begin production on schedule in June 2010. Firestone is also preparing to move one of its plants, with a production capacity of 1.5 metric tons (1.7 tons) per year, to Botswana from a previous project in South Africa.

Nigeria Mining Output to Account for 20% of GDP

Dieziani Alison-Madueke, Nigerias minister of mines and steel development, said that the mining sector would contribute 20 percent to the gross domestic product (GDP) within 10 years, which is a dramatic increase from the current 0.5 percent. It also overshadows the governments earlier prediction of 5 percent by 2019. Alison-Madueke said Nigerias gemstones were among the best in the world, but the local mining industry lacks the capacity, tools and upgraded processing plants to bring them succesfully to market.

Shareholders Keep Rockwells Execs, Shareholder Rights Plan

With three quarters of Rockwells issued and outstanding shares voting in the special shareholder vote that was ordered by Pala Investments — which owns approximately 20 percent of the shares in the diamond miner — more than 57 percent of the votes were cast against removing any member of the board of directors. Approximately 62 percent of cast votes favored the existing shareholder rights plan, and 57 percent voted not to reimburse Pala for its costs associated with the special meeting. Rockwells executive directors did, however, decide to remove the Fair Rights Offering from the meeting agenda.

Sierra Leone Committee Approves Draft of Mining Act

The 2009 draft of Sierra Leones mines and mineral act has been reviewed and intends to give the government more control of and ability to monitor the activities of mining companies to maximize the benefit from diamonds for the country and its people. It also intends to ensure that child labor is entirely discouraged. The act must be approved by the cabinet, followed by Parliament, in order to become law.

Econ Watch:

Week ending June 18, 2009

June.11 June.11 Chng.
$1 = Euro 0.719 0.715 0.004
$1 = Rupee 48.1 47.6 0.5
$1 = Israel Shekel 3.96 3.91 0.05
$1 = Rand 8.17 7.95 0.22
$1 = Canadian Dollar 1.13 1.11 0.02

Precious Metals
Gold $932.30 $954.60 -$22.30
Platinum $1,201.00 $1,263.00 -$62.00

Stock Indexes Chng.
BSE 14,265.53 15,411.47 -1,145.94 -7.44%
Dow Jones Avg. 8,555.60 8,770.92 -215.32 -2.45%
FTSE 4,280.86 4,461.87 -181.01 -4.06%
Hang Seng 17,776.66 18,791.03 -1,014.37 -5.40%
S & P 500 918.37 944.89 -26.52 -2.81%
Yahoo! Jewelry Index 699.53 765.35 -65.82 -8.60%

USA
Birks & Mayors $0.65 $0.55 $0.10 18.18%
Blue Nile $40.50 $46.56 -$6.06 -13.02%
Charles & Colvard $0.52 $0.51 $0.01 1.96%
DGSE Companies, Inc. $1.10 $1.05 $0.05 4.76%
Fuqi International $16.13 $17.32 -$1.19 -6.87%
JCPenney $25.90 $27.92 -$2.02 -7.23%
Kohls $43.69 $45.92 -$2.23 -4.86%
Lazare Kaplan $2.32 $2.77 -$0.45 -16.25%
LJ International $1.74 $2.10 -$0.36 -17.14%
Macys $10.63 $12.00 -$1.37 -11.42%
Man Sang $2.40 $3.39 -$0.99 -29.20%
Movado Group $11.03 $12.05 -$1.02 -8.46%
Nordstrom $18.98 $20.52 -$1.54 -7.50%
Saks $3.87 $3.76 $0.11 2.93%
Signet $18.49 $21.09 -$2.60 -12.33%
Sothebys $13.57 $14.05 -$0.48 -3.42%
Tiffany $25.73 $27.80 -$2.07 -7.45%
Wal-Mart $48.68 $49.32 -$0.64 -1.30%
Zale $3.31 $3.91 -$0.60 -15.35%

EUROPE
Bulgari €4.03 €3.92 €0.11 2.81%
Bijou Brigitte €94.01 €96.55 -€2.54 -2.63%
Esa €3.04 €2.87 €0.17 5.92%
Golay-Buchel CHF 1,625.00 CHF 1,590.00 CHF 35.00 2.20%
LVMH €55.83 €59.70 -€3.87 -6.48%
Pinault P-R SA €55.30 €62.83 -€7.53 -11.98%
Richemont SA CHF 21.84 CHF 23.76 -CHF 1.92 -8.08%
Swatch Group CHF 165.70 CHF 188.10 -CHF 22.40 -11.91%
Theo Fennell (pence) 30.20 33.88 -3.68 -10.86%

INDIA (rupee)
Classic Diamond 16.40 17.65 -1.25 -7.08%
Gitanjali Gems 112.90 138.35 -25.45 -18.40%
Rajesh Exports 43.70 52.65 -8.95 -17.00%
Ren. Jewellery 32.50 38.00 -5.50 -14.47%
Su-Raj Diamonds 35.00 40.90 -5.90 -14.43%
Titan 1,167.20 1,206.65 -39.45 -3.27%
Zodiac JRD 16.70 18.00 -1.30 -7.22%
Suashish Diamonds 182.90 176.90 6.00 3.39%

NEW ZEALAND
Michael Hill NZD 0.68 NZD 0.67 NZD 0.01 1.49%

MINING STOCKS
(pence unless noted)
USA
Anglo American $13.00 $14.73 -$1.73 -11.74%
CANADA
Archangel CAD 0.05 CAD 0.12 -CAD 0.07 -56.52%
Harry Winston CAD 7.00 CAD 7.25 -CAD 0.25 -3.45%
Mountain Province CAD 1.78 CAD 1.84 -CAD 0.06 -3.26%
Peregrine Diamonds CAD 0.59 CAD 0.56 CAD 0.03 5.36%
Rockwell Diamonds CAD 0.07 CAD 0.09 -CAD 0.03 -27.78%
Shore Gold CAD 0.55 CAD 0.58 -CAD 0.03 -5.17%
Stornoway Diamond CAD 0.16 CAD 0.15 CAD 0.01 3.33%
True North Gems CAD 0.14 CAD 0.12 CAD 0.02 16.67%
UK (pence)
African Diamonds 24.3 24.2 0.1 0.21%
BHP Billiton 1,378.0 1,517.0 -139.0 -9.16%
Firestone Diamonds 36.6 43.2 -6.6 -15.28%
Gem Diamonds 168.3 175.0 -6.8 -3.86%
Gemfields 7.0 6.3 0.7 11.11%
Mano River 4.0 4.0 0.0 -0.74%
Mwana Africa 8.4 5.9 2.4 40.57%
Namakwa Diamonds 41.7 45.5 -3.8 -8.40%
Petra Diamonds 38.0 41.0 -3.0 -7.22%
Rio Tinto plc 2,055.8 3,157.0 -1,101.2 -34.88%

Rapaport TradeWire - Friday, July 10, 2009
Caution: Polished prices softening with some discounts exceeding 40% below list. Rough price bubble developing as Antwerp reports further 10% price increase at BHP tenders. Recent rough price increases appear unsustainable and may be fueled by too much Indian bank credit. News: Birks & Mayors 4Q sales -23% to $49.2 mil., net loss of $14.4 mil. vs. profit of $3.3 mil. Petra Diamonds FY09 production +454% to 1.1 mil. ct., revenues -10% to $69.1 mil. BRC DiamondCore sells S. Africa assets to KIG Mining for $11 mil. Belarus 1H rough imports -65% to 15,550 ct. Kimberley Process review team reportedly accuses Zimbabwe of human rights abuses. Government says they will demilitarize Marange diamond fields, but few believe them.

ANNOUNCEMENTS:

RAPAPORT TENDER IN NEW YORK

Polished Diamond Tender – By Appointment Only
July 22-28, 2009

Large selection of melee, rounds and fancies, -6.5 to 1ct+,
from promotional to very fine qualities. Excellent opportunity
for diamond and jewelry manufacturers specializing in
inexpensive diamonds.

Contact Myles Schakler at NYTender@diamonds.net
or +1-212-354-9800

RAPAPORT INTERNATIONAL DIAMOND CONFERENCE

Sept. 10, 2009, New York – 8:30 am to 5:00 pm

Conference Topic:
“New Realities - Where do we go from here?”

The conference will be held at in the new
New York Times Center, 242 West 41 St.

Reservations will be strictly limited to first 320 tickets.
$249 until August 15, $349 thereafter if tickets available.
Lunch not included, but we can arrange restaurant reservations.

Reserve Now: idc@diamonds.net, +1-702-893-9400

Retail Quote:

"We continue to navigate the company through very difficult economic times by carefully managing the level and productivity of our inventory, reducing our operating costs and limiting capital expenditures while continuing to focus our attention on providing our customers with superior service and selection, while working with and supporting our key product brands and maintaining strong client relationships, all with the focus on optimizing cash flow."

Tom Andruskevich
President of Birks & Mayors

World News:

KP Implicates Zim Army, Govt Commits to Withdraw Troops

A visiting delegation from the Kimberley Process has concluded its weeklong investigation into Zimbabwes controversial diamond mining trade and found that the countrys military and police were major contributors to the illegal activities, human rights abuses and murders that took place in the Marange diamond fields, contrary to statements by government officials. The group recommended that the army be immediately removed from the diamond fields. Despite denying wrongdoing, Zimbabwe has promised to withdraw its soldiers from the diamond fields. They will be withdrawn in phases while security details are worked out. The Kimberley Process delegation also found that Zimbabwes border controls and the security around diamond mining areas were insufficient.

GJEPC Announces Benefits in Indias Union Budget

As a result of its aggressive lobbying of the government, Indias Gem and Jewellery Export Promotion Council (GJEPC) stated, various measures for the benefit of the countrys jewelry industry were put in place in the newly announced 2009-10 union budget. These include an extension of the 2 percent interest subvention on the rupee export credit until March 31, 2010, the abolition of import duties on branded jewelry and rough coral, and the abolition of the fringe benefit tax. among many others. Customs import duties on gold and silver, excluding gold and silver jewelry, were increased.

Thai Govt Set to Scrap VAT on Rough Gems

The Thai government is planning to scrap its value added tax (VAT) for jewelers on imports of rough diamonds, gems and raw materials, in order to lower the industry’s tax burden and help make Thailand closer into a world gem and jewelry hub. Korn Chatikavanij, the finance minister, will propose the tax change to the cabinet in July so that it can be implemented immediately. Jewelry exports from Thailand totaled $4.8 billion (THB 165 billion) in the first five months of 2009. The tax reforms are aimed at helping the industry achieve the governments target of $8.8 billion (THB 300 billion) for the year.

Diamond News Broadcast

Ross Simons jewelers is carrying a new line of jewelry from supermodel Christie Brinkley, and the retailers vice president of marketing discusses how the collection has been received so far. Jovella 2009 may have had fewer exhibitors, but those in attendance remain confident in the future of Israels jewelry industry.
http://www.diamonds.net/news/NewsItem.aspx?ArticleID=27003

Retail & Wholesale:

Decline Slows at U.S. Retailers in June

U.S. retail sales continued to fall in the five weeks that ended July 5, 2009, though the rate of the decline did appear to slow. The drop in sales was smaller at almost every retailer, compared with Mays results. Saks Incorporateds sales fell 4 percent to $230.2 million, and same-store sales also decreased 4 percent. Neiman Marcus sales declined 19 percent to $323 million, with same-store sales down 21 percent; online sales dropped 10 percent. Sales at Nordstrom fell 6 percent to $686 million, and same-store sales decreased 10 percent. Sales at Macys declined 9 percent to $2 billion in June, with same-store sales also down 9 percent; online sales rose 8 percent for the month. J.C. Penney Companys June sales fell 7 percent to $1.5 billion and same-store sales dropped 8 percent. JCPenneys fine jewelry division improved from previous months due to a promotional event. Kohl’s Corporations June sales declined 2 percent to $1.5 billion, with same-store sales down 6 percent. Dillards sales decreased 16 percent to $497.2 million, and same-store sales fell 14 percent. Sales at BJ’s Wholesale Club, Inc. dropped 5 percent to $1 billion, and same-store sales declined 8 percent, with the jewelry department among the weaker performers. Costco Wholesale Corporations sales were down 4 percent to $6.9 billion, while same-store sales decreased 6 percent.

U.S. Weekly Chain Store Sales Remain Nearly Flat

Chain store sales across the U.S. for the week that ended July 4, 2009, rose 0.5 percent, according to the latest figures from the International Council of Shopping Centers (ICSC) and Goldman Sachs. While ICSC expects sales for the month of June overall to have dropped 4.5 percent, the group noted that the first half of the month was weaker than the final two weeks.

Hong Kong Jewelry Sales Weigh Heavily on May Retail

Hong Kong’s retail sales fell 6.2 percent to $2.8 billion (HKD 21.6 billion) in May, with the jewelry sector ranking among the worst performers. Total retail sales by volume fell 6.4 percent for the month. Sales of jewelry, watches, clocks and valuable gifts declined 10.9 percent. Sales were likely affected by the decline in tourism in May, but local consumer sentiment has continued to hold up.

Birks & Mayors FY Sales -14%, Reports Loss of $61M

Fiscal-year sales at Birks & Mayors fell 14 percent to $270.9 million, and same-store sales also fell 14 percent. The retailer saw a net loss of $61 million, compared with profits of $10.4 million one year ago. Net sales during fiscal 2009 included an $11.7 million charge associated with the strengthening of the U.S. dollar. At the end of the fiscal year, Birks & Mayors inventory totaled $155.6 million, compared with $181.9 million one year earlier. Bank indebtedness decreased $34.4 million as a result of the company replacing a portion of its line of credit with long-term notes.

Finlay Misses June Interest Payment on Senior Notes

As predicted in its last quarterly report, Finlay Enterprises failed to make a semiannual interest payment of $1.7 million that was due on June 1, 2009, to the holders of Finlay Jewelry’s senior notes, a payment which it does not intend to make. Those holding at least 25 percent of the senior notes, which are due June 1, 2012, may therefore demand immediate payment, but this had not happened as of July 2. Finlay Jewelry has also been continuously in default of a covenant, under its new revolving credit agreement issued in February, that requires sales targets and maintenance of cash disbursements. In an unrelated announcement, Finlay reported that Rohit M. Desai has resigned as a member of the board, effective immediately.

WHO IS NEWS

Bird Leaves Charles & Colvard

Charles & Colvard and Bird Capital Group have agreed to end their five-month-old relationship. Charles & Colvards business model must be modified to navigate the economic environment as a low-cost operation, the groups wrote in a joint statement. Richard Bird, Bird Capitals founder, also resigned as a director and officer of Charles & Colvard, effective July 2, 2009. He agreed, however, to consult for Charles & Colvard until August 31. The board of directors is now seeking a new chief executive officer (CEO).

Gordon, Larkin Leave Zale

Cindy Gordon, senior vice president, controller and chief accounting officer for Zale, and Steve Larkin, Zales executive vice president and chief marketing and e-commerce officer, have both left the company. Gordon resigned effective June 30, and was replaced by Jim Sullivan. Larkin resigned on June 4, and signed a separation agreement on June 25 that provided him with severance pay of $651,693 in exchange for signing noncompete and nonsolicitation provisions. He will also receive accrued but unpaid base salary, vacation pay or bonuses, if any, for a period of 18 months. Zale did not yet name a replacement.

Wal-Marts Mortensen to Head Fine Jewelry for JCPenney

J.C. Penney Company appointed Pam Mortensen as senior vice president and general merchandise manager of its fine jewelry division, effective July 27, 2009. Mortensen will report to Jeff Allison, executive vice president and general merchandise manager of home and custom decorating. Mortensen was most recently with Wal-Mart Stores, where she served as vice president and divisional merchandise manager of the fine jewelry and watch division.

Bangkok and Idar-Oberstein Bourses Vote in New Directors

The diamond bourses in Bangkok, Thailand, and Idar-Oberstein, both affiliated with the World Federation of Diamond Bourses (WFDB), have held elections. At the Bangkok Diamonds and Precious Stones Exchange (BDPSE), Boonyong Assarasakorn was reelected to the position of president. Somchai Phornchindarak will serve as vice president and Pichet Romhuttirerk will continue to serve as secretary general. Meanwhile, the Diamant-und Edelsteinbörse Idar-Oberstein E.V. reelected Jochen Müller to serve a second term as president. The three new vice presidents are Manfred Giloy, Christian Klein and Bernd Willi Ripp.

David Peters Elected to DCA Board

David Peters was elected as a director to the Diamond Council of America (DCA) Board during the councils annual meeting in Las Vegas in early June. Peters is director of member services for Jewelers of America, where he is responsible for developing partnerships for products and educational services to advance the benefits of membership. He also conducts seminars and educational programs at major industry events in the U.S.

GENERAL:

Belarus 1H Rough Imports -65%

Rough imports to Belarus fell 65 percent to 15,550 carats during the first half of 2009. The dollar value of these imports dropped 68 percent to $4.3 million. During the second quarter, imports dropped 80 percent to 4,050 carats, or 63 percent by value to $2.1 million. Belarus imported rough diamonds from Russia, Belgium and Israel during the period.

Liberian Truth Commission: Ban Sirleaf from Office

In its final report, Liberias Truth and Reconciliation Commission (TRC), the panel investigating the countrys successive 1989-2003 civil wars, included President Ellen Johnson Sirleafs name on a list of people that it accused of leading and financially supporting the warring factions. The TRC therefore recommended that she, like the others on the list, should be banned from holding public office for 30 years. Sirleaf did not respond to the reports recommendations. Jackson Doe, the transport minister and the elder brother of former president Samuel Doe, was also on the list.

Taylors Lawyers List 256 Potential Witnesses

Charles Taylor, Liberias former President, will take the stand in his own defense against charges of war crimes and crime against humanity on July 14, a day after his lawyers present their opening statement. Brenda Hollis, lawyer for the prosecution, said at a hearing Monday that Taylors lawyers have lined up an "excessive" list of 256 potential witnesses, which, if all of them are called, could make the trial take up to four more years. Taylors lawyers countered that they do not necessarily expect to call every witness, pointing out that the prosecution called fewer than half of the approximately 200 witnesses that it had listed.

Responsible Jewellery Council Reaches 130 Members

The Responsible Jewellery Council (RJC) announced on July 5 that its membership has now reached 130 diamond and gold jewelry companies and trade associations. Fifty-two new members have joined RJC in the first six months of 2009, including Fred Meyer Jewelers, the Gemological Institute of America (GIA), Venus Jewel, Accurist Watches Limited and the mining company Eurocantera. The biggest proportion of RJCs membership is now made up of small and medium-sized companies such as independent retailers and single-location diamond cutting operations

Jewelry Store Owner Killed by Robbers

Two men entered Jewelry for Less on Dr. Martin Luther King Drive in Fairfield, Alabama, at around 5:10 p.m. on July 2 and broke a jewelry case. When Lee Buong, the 54-year-old owner, came out from the rear of the store, he was shot dead. Buongs wife was in the store during the shooting. The robbers fled toward Bessemer in a black Nissan Maxima. It is not known whether anything was taken.

Kay Jewelers Launches Gold Exchange

Signet Groups Kay Jewelers launched the Kay Gold Exchange. Customers who send in items made from 10-karat, 14-karat, 18-karat, 22-karat or 24-karat gold, or their European equivalents, will receive cash in return. Customers can return the payment check within 14 days of issuance and Kay will return the items at no cost. Every package received is videotaped while it is being opened, enabling customers to log in and view their valuables being unpacked and weighed. The program uses purity, the weight of the metal and the market price of each type of metal to determine payment.

GIA Sheds Light on Fluorescence

The Gemological Institute of America (GIA) will now include additional information explaining and describing ultraviolet (UV) fluorescence and its properties in every GIA Diamond Grading Report and Diamond Dossier that carries a diamond fluorescence description of medium or stronger. A separate four-color insert addresses the most frequently asked questions about fluorescence, explains its properties in easy-to-understand terms and includes comparison images of diamonds in both natural and UV light to illustrate varying intensities of fluorescence.

DIAMOND MINING:

Diamond Project Acquisitions -73% in 2008-09

The value of all acquisitions in diamond projects in 2008-2009 fell 73 percent to $210.5 million. A total of 19.7 million carats in resources changed hands during the year that ended May 31, 2009, a decline of 91 percent compared with 2007-2008. There were 14 diamond transactions valued at more than $1 million during the year, down from 26 during the previous year. Canada accounted for 67 percent of total acquisitions, due primarily to Kinross’s $104.4 million purchase of 9 percent of the Diavik mine from Harry Winston. Acquisitions in South Africa fell 98 percent to $5.8 million, and in Australia, acquisitions declined 94 percent to $15.4 million.

ALROSA sells Gokhran $384M in Rough, Appts Marketing VP

Russia’s state precious metals and gemstones repository, the Gokhran, has bought approximately $383.8 million (RUB 12 billion) worth of rough diamonds from ALROSA so far in 2009. This amount includes the $118 million (RUB 3.69 billion) of rough that Gokhran agreed to buy annually from ALROSA through 2010. Separately, ALROSA announced the appointment of Vladlen Dmitrievich Nogovitsyn as its vice president of marketing. Nogovitsyn previously worked as managing director of ALROSA Hong Kong.

Old Mutual Challenges Xstrata to Raise Offer for Anglo

Insurance group Old Mutual, which owns 3 percent of Anglo American, has challenged Xstrata to raise its offer for the mining giant, saying that Anglos board should only look at a bid if the offer is increased to reflect its valuable assets. A representative of Old Mutual stated that if Xstratas offered price adequately compensated for the significant dilution of Anglo Americans unique exposure to the structurally attractive platinum, coking coal, iron ore and diamond markets, Anglos board would almost certainly consider it.

Namdeb Resumes Mining Operations

Namdeb’s is ending its three-month production interruption, which took effect during the second week of April 2009; mining activities will restart beginning in mid-July. Namdeb employees remained on full pay during the hiatus, and the company carried out maintenance work on its major assets to ensure that the mines run at an optimal level as demand begins to recover. The return to production will be preceded by a two-week reorientation period, when employees will be retrained in safety, health and environmental standards.

Mountain Province, De Beers Renew Gahcho Kué JV

Mountain Province Diamonds has renewed its joint venture agreement with De Beers in the Gahcho Kué diamond project in Canadas Northwest Territories (NWT). Under the amended terms of the agreement, Mountain Province maintains a 49 percent stake in the project, and will repay De Beers $50.6 million (CAD 59 million) to settle the projects costs through the end of 2008. As soon as possible, the two companies will conduct a feasibility study on Gahcho Kué, of which Mountain Province will cover the full cost.

Namakwa Diamonds Increases Mining Production in 3Q

Namakwa Diamonds has started to ramp up its mining operations again. The mining companys production rose to 4,200 carats in the third fiscal quarter that ended May 31, 2009, up 114 percent from the previous quarter, after it significantly reduced output and shifted focus to its beneficiation business during the economic crisis. Namakwas report said that it expects fourth-quarter production to increase 39 percent from the previous quarter, to 5,850 carats, which will still be about 52 percent below production levels in the first quarter.

Petra FY09 Production Over 1M Cts., Revenues -10%

Petra Diamonds total production in fiscal 2009, which ended on June 30, rose 454 percent to 1,108,815 carats, as the purchase of the Cullinan mine helped the company achieve its stated goal. Revenues fell 10 percent to $69.1 million. Petra sold 1,011,834 carats of its total production for an average of $93 per carat, compared with 230,172 carats for an average $336 per carat the previous year.

No Ruling Yet On DiamonEx Mine Liquidation

The Botswana High Court has not yet made a ruling on the liquidation of DiamonExs Lerala diamond mine after a recent hearing. DiamonEx has not made any profit since it started operating, due to disappointing results from its first sales. The company had to seek permission to be put under judicial management by the High Court for one year, until February 2010. Currently, the mine is not operating. DiamonEx hopes that the mine will recover when the diamond prices improve and make back the $41.1 million (BWP 280 million) investment used to set it up.

BRC DiamondCore Sells S. Africa Assets for $11M

BRC DiamondCore has agreed to sell its South Africa-based alluvial diamond projects — the Silverstreams, De Kalk, Muishoek, Sanddrift and Uitdraal projects, and their associated processing plant, mining fleet and equipment — to Frankfurt-based KIG Mining for a total of $10.7 million. KIG plans to resume operations at Silverstreams using staff previously employed there. BRCs ability to complete the sale, however, may be adversely affected if it is unsuccessful in its appeal against a recent decision by the Northern Cape High Court, which granted a former advisor to BRC the right to liquidate DiamondCore Resources, BRCs subsidiary that holds the companys South African projects.

Cameroon Wants Diamond Mining to Start in 2010 Not 2012
The government of Cameroon is consulting experts and officials about moving the start of commercial diamond mining at Mobilong in the east of the country up by two years, to 2010 from an original plan of 2012. Mobilongs diamond resource is estimated at more than 750 million carats,which a South Korean-Cameroonian mining firm, Cameroon and Korean Mining, or C&K Mining, is seeking to exploit. A committee is being created to evaluate the results of C&Ks feasibility studies, after which the head of state must accord an exploitation license to the company.

Econ Watch:

July.9 July.2 Chng.
$1 = Euro 0.716 0.711 0.005
$1 = Rupee 48.8 48.0 0.7
$1 = Israel Shekel 3.97 3.88 0.09
$1 = Rand 8.13 7.87 0.26
$1 = Canadian Dollar 1.16 1.15 0.01

Precious Metals
Gold $912.90 $927.50 -$14.60
Platinum $1,106.00 $1,187.00 -$81.00

Stock Indexes Chng.
BSE 13,757.46 14,658.49 -901.03 -6.15%
Dow Jones Avg. 8,183.17 8,280.74 -97.57 -1.18%
FTSE 4,158.66 4,234.27 -75.61 -1.79%
Hang Seng 17,790.59 18,178.05 -387.46 -2.13%
S & P 500 882.68 896.42 -13.74 -1.53%
Yahoo! Jewelry Index 680.14 672.25 7.89 1.17%

USA
Birks & Mayors $0.57 $0.56 $0.01 1.79%
Blue Nile $37.69 $39.89 -$2.20 -5.52%
Charles & Colvard $0.46 $0.52 -$0.06 -11.62%
DGSE Companies, Inc. $1.02 $0.99 $0.03 3.03%
Fuqi International $16.98 $19.96 -$2.98 -14.93%
JCPenney $26.58 $27.28 -$0.70 -2.57%
Kohls $43.02 $41.25 $1.77 4.29%
Lazare Kaplan $2.50 $2.48 $0.02 0.81%
LJ International $1.79 $1.76 $0.03 1.70%
Macys $10.63 $11.00 -$0.37 -3.36%
Man Sang $1.81 $2.25 -$0.44 -19.56%
Movado Group $9.35 $9.90 -$0.55 -5.56%
Nordstrom $19.72 $18.63 $1.09 5.85%
Saks $4.29 $4.84 -$0.55 -11.36%
Signet $20.06 $20.45 -$0.39 -1.91%
Sothebys $11.46 $12.99 -$1.53 -11.78%
Tiffany $24.94 $24.29 $0.65 2.68%
Wal-Mart $48.08 $47.79 $0.29 0.61%
Zale $3.76 $3.76 $0.00 0.00%

EUROPE
Bulgari €3.57 €3.80 -€0.23 -6.05%
Bijou Brigitte €96.74 €92.49 €4.25 4.60%
Esa €2.57 €2.47 €0.10 4.05%
Golay-Buchel CHF 1,750.00 CHF 1,750.00 CHF 0.00 0.00%
LVMH €53.51 €54.61 -€1.10 -2.01%
Pinault P-R SA €55.39 €58.00 -€2.61 -4.50%
Richemont SA CHF 22.42 CHF 22.46 -CHF 0.04 -0.18%
Swatch Group CHF 163.10 CHF 171.50 -CHF 8.40 -4.90%
Theo Fennell (pence) 46.00 47.00 -1.00 -2.13%

INDIA (rupee)
Classic Diamond 13.75 16.75 -3.00 -17.91%
Gitanjali Gems 95.30 108.45 -13.15 -12.13%
Rajesh Exports 36.75 43.95 -7.20 -16.38%
Ren. Jewellery 42.55 41.35 1.20 2.90%
Su-Raj Diamonds 33.75 37.45 -3.70 -9.88%
Titan 1,184.75 1,180.20 4.55 0.39%
Zodiac JRD 14.75 16.80 -2.05 -12.20%
Suashish Diamonds 160.00 183.95 -23.95 -13.02%

NEW ZEALAND
Michael Hill NZD 0.64 NZD 0.62 NZD 0.02 3.23%

MINING STOCKS
(pence unless noted)
USA
Anglo American $13.40 $14.10 -$0.70 -4.96%
CANADA
Archangel CAD 0.06 CAD 0.06 CAD 0.00 0.00%
Harry Winston CAD 6.50 CAD 6.78 -CAD 0.28 -4.13%
Mountain Province CAD 1.57 CAD 1.70 -CAD 0.13 -7.65%
Peregrine Diamonds CAD 0.74 CAD 0.75 -CAD 0.01 -1.33%
Rockwell Diamonds CAD 0.04 CAD 0.05 -CAD 0.01 -11.11%
Shore Gold CAD 0.43 CAD 0.45 -CAD 0.03 -5.56%
Stornoway Diamond CAD 0.12 CAD 0.11 CAD 0.01 9.09%
True North Gems CAD 0.13 CAD 0.14 -CAD 0.01 -3.70%
UK (pence)
African Diamonds 21.3 24.4 -3.1 -12.66%
BHP Billiton 1,315.4 1,361.6 -46.3 -3.40%
Firestone Diamonds 23.0 31.3 -8.3 -26.40%
Gem Diamonds 141.0 152.8 -11.8 -7.69%
Gemfields 6.5 6.8 -0.3 -3.70%
Mano River 3.8 3.8 0.0 0.00%
Mwana Africa 4.5 5.0 -0.4 -8.87%
Namakwa Diamonds 32.0 38.8 -6.8 -17.42%
Petra Diamonds 40.5 39.5 1.0 2.53%
Rio Tinto plc 1,967.0 2,046.0 -79.0 -3.86%

Rapaport TradeWire - Friday, July 17, 2009
News: Widening gap between buyers and sellers over prices slowing polished trading. Rough prices stabilizing after recent increases. Letseng 1H sales -18% to $74 mil., production +6% to 47,165 cts. Rio Tinto 2Q production -72% to 1.28 mil. cts. Rockwell 1Q sales -45% to $3.5 mil., net loss of $3.7 mil., vs. loss of $714K. Shrenuj & Co. buys Botswana factory to become DTC Botswana sightholder. U.S. May polished imports -46% to $1.25 bil., polished exports -48% to $660 mil. Belgium’s June polished exports -35% to $755.5 mil., rough imports -38% to $757.4 mil. India’s June polished imports -13% to $1.08 bil., rough imports -39% to $769 mil. S. Africa May diamond production -62%. U.S. June jewelry CPI +0.8%. ALROSA replaces Sergei Vybornov with Fyodor Andreyev as company president.

ANNOUNCEMENTS:

RAPAPORT TENDER IN NEW YORK

Polished Diamond Tender – By Appointment Only
July 22-28, 2009

Large selection of melee, rounds and fancies, -6.5 to 1ct+,
from promotional to very fine qualities. Excellent opportunity
for diamond and jewelry manufacturers specializing in
inexpensive diamonds.

Contact Myles Schakler at NYTender@diamonds.net
or +1-212-354-9800

RAPAPORT INTERNATIONAL DIAMOND CONFERENCE

Sept. 10, 2009, New York – 8:30 am to 5:00 pm

Conference Topic:
“New Realities - Where do we go from here?”

The conference will be held at in the new
New York Times Center, 242 West 41 St.

Reservations will be strictly limited to first 320 tickets.
$249 until August 15, $349 thereafter if tickets available.
Lunch not included, but we can arrange restaurant reservations.

Reserve Now: idc@diamonds.net, +1-702-893-9400

Retail Quote:

"People still want wedding rings, but now theyll choose silver rather than gold and theyll choose a smaller diamond. Ive cut out the middle man. I like to do my own gemstone carving, but it might take me hours to do one, and I can buy them cheaply from China. Ive always been more competitive, simply because I produce everything myself. And I think thats my key to survival."

Norm Coker
Gems by Norm, Portland, Oregon

World News:

U.S. Retail Sales Take a Dive in June

Department store sales in the U.S. during the month of June fell 9.4 percent to $15.4 billion. Retail trade sales were down 10 percent from one year ago. Meanwhile, U.S. chain store sales fell 0.7 percent for the week that ended July 11, 2009, according to the latest data from the International Council of Shopping Centers (ICSC) and Goldman Sachs. ICSC reported that the first full week of July followed poor retail performance in June, when same-store sales at the nations chains dropped 5.1 percent.

U.S. Jewelry Consumer Price Index +1% in June

The consumer price index (CPI) for jewelry in the U.S. rose 0.8 percent year-on-year to 154.93 points for the month of June. The index increased less than one point from its value in May. While the month-to-month change was slight, the index has now topped 150 points for 17 consecutive months.

China 1H09 GDP +7%

According to preliminary estimates, Chinas gross domestic product (GDP) during the first half of 2009 rose 7.1 percent to $2.1 trillion after a strong second quarter. In quarterly terms, GDP rose 6.1 percent in the first quarter and 7.9 percent in the second. Domestic consumer spending rose 15 percent to $826 billion.

ALROSA Replaces Vybornov with Andreev

Sergei Vybornov was dismissed as president of ALROSA this week, and the board appointed Fyodor Andreev to the post. Vybornovs departure follows a comprehensive check of ALROSAs operations by Russias Audit Chamber, which identified numerous violations in company operations that have been forwarded to the General Prosecutors office. Andreev is vice president of Russian Railways.

Zim Vows New Crackdown on Diamond Miners

Zimbabwe is preparing to relaunch a military crackdown on illegal diamond miners in the eastern part of the country, risking an international ban on its precious stones. Operation Hakudzokwi, meaning "You dont return," is meant to restore order at the Chiadzwa diamond fields, and has come under fire by human rights groups. Illegal diamond dealers and panners were ordered to stop activities immediately or face the consequences, according to the government.

Diamond News Broadcast

U.S. polished diamond imports and exports during the past year clearly show depressed market conditions leading up to the JCK Vegas show. The U.S. imported a record amount, by value, of polished goods in May 2008, but this was followed by record polished exports in June. Polished imports for May 2009 were almost half what they were one year ago. The more disturbing news, however, was that for the first five months of this year, polished imports have been consistently down by about half from trading levels in 2008. Statistics for U.S. net polished imports show even greater declines from one year ago.
http://www.diamonds.net/news/NewsItem.aspx?ArticleID=27115

DIAMOND STATS:

Belgium June Polished Exports
June YTD
$Mil. Chng. $Mil. Chng.
Polished exports $755 -35% $4,046 -38%
Polished imports $757 -38% $3,851 -40%
Net exports ($2) 97% $195 85%

Rough imports $658 -38% $2,646 -55%
Rough exports $763 -35% $3,026 -52%
Net imports ($105) 16% ($379) 16%

Net Diamond Acct. $103 64% $575 3%

India June Polished Exports
June YTD
$Mil. Chng. $Mil. Chng.
Polished exports $1,100 -13% $5,505 -30%
Polished imports $641 -5% $3,121 -15%
Net exports $436 -22% $2,384 -44%

Rough imports $770 -39% $2,555 -55%
Rough exports $57 -40% $320 -25%
Net imports $713 -39% $2,235 -58%

Net Diamond Acct. ($276) 54% $148

U.S. May Polished Imports
May YTD
$Mil. Chng. $Mil. Chng.
Polished imports $1,250 -46% $4,395 -50%
Polished exports $660 -48% $3,244 -45%
Net imports $590 -43% $1,151 -59%

Rough imports $24 -73% $84 -76%
Rough exports $14 -70% $58 -69%
Net imports $10 -76% $26 -84%

Net Diamond Acct. $600 -45% $1,177 -61%

S. Africa Diamond production -62% in May

South Africa’s diamond production fell 62.4 percent in May compared with one year ago. Compared with April, diamond production fell 1 percent in May. For the three months that ended May 31, South Africa’s diamond output rose 1.9 percent from the previous quarter.

RETAIL & WHOLESALE:

May Sales of Watches, Jewelry -17% in Singapore

Singapores retail sales for May 2009 decreased by 10.3 percent from one year ago. The decline was mainly due to lower sales of motor vehicles and petrol. Sales of watches and jewelry declined by 16.7 percent from May 2008.

Shrenuj Botswana Appointed as DTC Botswana Sightholder

Diamond Trading Company (DTC) Botswana appointed Shrenuj Botswana (Pty) Limited as a DTC Botswana sightholder. The Shrenuj Botswana factory will manufacture diamonds to benefit the citizens and the economy of Botswana. Shrenuj Botswana is part of the Shrenuj India Group, which has been a sightholder of the DTC since 1982.

Gitanjali USA Acquires 51% Stake in Diamlink

Gitanjali acquired a 51 percent stake in New York-based diamond jewelry maker Diamlink. Gitanjali did not disclose financial details of the acquisition.

JCPenney Celebrates Store Opening in New York City

J. C. Penney Company will celebrate the grand opening of its new 153,000-square foot store in Manhattan, at 33rd Street and 6th Avenue, on July 31, 2009. The two-level store is accessible from street level as well as directly from two of Manhattan’s busiest public transportation terminals — the 34th Street-Herald Square subway station and the 33rd Street PATH train station.

Cartier Robbery in Cannes May Have Topped $20M

Thieves dressed in Hawaiian shirts and armed with guns pulled off a jewerly heist at Cartier in Cannes, France. The raid lasted less than one minute. Estimates of the stolen goods run as high as $21 million. Police suspect the men were members of the "Pink Panther" gang.

Birks & Mayors to Close Store in St. Catharines

Birks & Mayors will close its Birks location at the Niagara Peninsula Centre in St. Catharines, Ontario, Canada, effective July 31, 2009. The closure will affect five employees. The jeweler has 10 other locations in the province of Ontario — nine locations in the greater Toronto area as well as one in Hamilton.

Cartier Hears from Next Generation of Shopper

Cartier evaluated its business through the eyes of its next generation of consumer during a unversity business- and design-school program. Students suggested that Cartier create a separate bridal instore "experience" by devoting a specific area to wedding-related jewelry and event planning. Another suggestion was to build a watch bar and to hold parties for new watch owners in an effort to build loyalty. The flagship store needed updating, students said, for example by creating a Zen-like atmosphere or by adding flat-screen TVs.

Court Awards Mervis Diamond $4M in Lease Case

Mervis Diamond Importers was awarded a total of $4.3 million, which includes legal fees, in a judgment against Congressional Hotel Corporation (CHC) for breach of contract. CHC failed to deliver on terms of the lease it signed for Mervis Diamonds expansion plans in 2005. CHC was also held liable for Mervis Diamonds lost profits, damages and prejudgment interest.

Bernadine Design Launches Lattice Diamond

Bernadine Design Co. of Burlingame, California, launched its Lattice Collection, inspired by ancient Chinese window architecture. Bernadine Wang, a jewelry designer and photographer,
fashioned the collection after studying window designs in a small village near Shanghai. The collection features white, champagne, brown and black diamonds set in necklace pendants, earrings and rings made with 18-karat yellow, rose or white gold. Price points for the Lattice Collection range from $1,000 for 18-karat gold peony earrings to $6,800 for an 18-karat gold purity pendant lined with black and white diamonds.

The Knot Finds Most Brides Take Part in Ring Selection

The Knot surveyed 9,000 recently married couples and found that 67 percent of the brides were involved in the selection and/or purchase of the engagement ring — an increase of 5 percent from a few years ago. The Knot also found that when the bride was involved in the process, the couple spent an average of three months shopping for the ring and viewed approximately 28 rings before making the purchase. The Knot reported that the average amount spent by all couples on engagement rings was $5,800, and that 20 percent ended up spending more than they had originally planned. Princess cuts have continued to gain in popularity, but rounds have remained most popular.

Gary Flyer Retires, Company Partners with KGK

Gary Flyer announced his retirement as president of Martin Flyer. Joshua Kaufman, Garys son-in-law, will take on the role. Additionally, Martin Flyer entered into a strategic alliance with KGK Group, giving the jewelry manufacturer access to additional diamond supplies.

GENERAL:

De Beers Works to Reduce Costs

De Beers requested a temporary exemption from paying royalties for Namdeb to help control costs. Production at Namdeb is resuming, but diamond demand, while having recovered slightly, is still very weak. De Beers also won a temporary covenant waiver on its GBP 1.8 billion in bank debt and has drafted advisers to help with a major restructuring. De Beers will pay an upfront fee and a higher interest rate on the existing debt. De Beers is expecting to post a profit in 2009 despite the weak demand in the market for rough diamonds. Production decreased 91 percent in the first quarter of fiscal 2009, but because the company has reduced operating and capital costs by $1.5 billion, the bottom line should remain positive. De Beers expects revenues from rough sales to fall 50 percent to about $3 billion in 2009. To date, the Diamond Trading Company (DTC) posted sales of approximately $1.1 billion from five of the 10 sights scheduled for 2009.

Anglo American Picks New Chairman

Anglo American appointed John Parker as chairman amid the British-South African groups fight to stay independent after recently snubbing Swiss rival Xstratas merger bid. Parker becomes chairman on August 1, replacing Mark Moody-Stuart, who is retiring after seven years in the job.

Govt to Auction $7M in Jewels Confiscated from Marcos

The government of the Philippines will hold a public auction for two of the three Imelda Marcos jewelry collections, with an estimated value of some $7 million. The Hawaii and Roumeliotes collections will be up for bid. They are currently kept at the Bangko Sentral ng Pilipinas. The Roumeliotes collection, the biggest and most expensive of the three collections, was confiscated by the Philippine Bureau of Customs on March 1, 1986.

State Diamond Trader to Review its Model

South Africa is reviewing the model of its State Diamond Trader (SDT). Ernest Blom, the chairman of the Diamond Council of South Africa, said the current model failed because the SDT had tried to buy and sell cheaper diamonds that were not viable for the local diamond industry. “The high-value diamonds are the ones that can be processed locally,” he added. Futhi Zikalala, the SDTs chief executive, however, said that the SDT was looking into changing the way it funded its business, but not the diamonds it bought. “Our current funding model was not geared to all the developmental needs of the SDT. A change in business model would require an amendment to the law.”

Gunmen Threaten to Kill Jeweler, Escape with Diamonds

Two armed men and a woman blocked a security door with a six-pack of soda while they robbed a Whittier, California, jewelry store of diamond rings and bracelets. No one was injured during the late morning robbery at Oasis Jewelry, located about 20 miles east of downtown Los Angeles, but one salesman told police that the robbers threatened to kill him. The suspects were described as Latinos. One of the men was bald, sported a mustache and wore a black windbreaker. The second man wore a hat. The woman may have been wearing a brown wig and was dressed in jeans and a pinkish shirt.

WFDB to Host Interbourse Pavilion at Iberjoya Show

The World Federation of Diamond Bourses will launch its first interbourse pavilion, which will function as a diamond trading floor, at the Iberjoya Trade Show in Madrid. Iberjoya runs from September 9 to 13 at the Feria de Madrid. Participants in the pavilion must be members of diamond exchanges affiliated with the Federation.

DIAMOND MINING:

Cash-Strapped Namdeb in Sales Deal with India

Namdeb sold rough to Diamonds India Limited, a consortium of 58 leading diamond and jewelry manufacturers and exporters in India. Erkki Nghimtina, Nambiais mines and energy minister, told The Namibian that the direct deal was governments way of assisting Namdeb with its cash-flow problems. "The aim was to solve the cash problem...and to assist Namdeb to get the cash which De Beers could not give it," he said.

Rio Tinto 2Q Diamond Production -72%

Rio Tinto diamond production fell 72 percent to 1.281 million carats in the second quarter of 2009. Production at the company’s fully-owned flagship Argyle mine decreased 86 percent to 408,000 carats, after Rio Tinto reduced production at the mine in March due to the decline in diamond demand. Rio Tinto’s 60 percent production share of the Diavik mine dropped 44 percent to 853,000 carats. The company also owns 78 percent of the Murowa mine in Zimbabwe, where its share of production sank 62 percent to 20,000 carats.

Rapaport TradeWire - Friday, July 24, 2009
News: De Beers raises prices and restricts supply at July sight to estimated $350 mil. Polished market trading remains slow as manufacturers in Israel and Belgium prepare for vacation. BHP Billiton 4Q production +5% to 903,000 cts. Trans Hex July tender generates $16.7 mil. Birks & Mayors 1Q sales -26% to $53.6 mil. Kristall of Smolensk 2008 revenues -28% to $241 mil., net profit -35% to $527,000. China’s June diamond imports +68% to $65.7 mil. Major mining companies create International Diamond Board to steer industry-wide generic marketing. Richard Lennox to head Zale marketing after resigning from De Beers account at JWT.

ANNOUNCEMENTS:

RAPAPORT INTERNATIONAL DIAMOND CONFERENCE

Sept. 10, 2009, New York – 8:30 am to 5:00 pm

Conference Topic:
“New Realities - Where do we go from here?”

The conference will be held at in the new
New York Times Center, 242 West 41 St.

Reservations will be strictly limited to first 320 tickets.
$249 until August 15, $349 thereafter if tickets available.
Lunch not included, but we can arrange restaurant reservations.

Reserve Now: idc@diamonds.net, +1-702-893-9400

Retail Quote:

"Wed never use a celebrity to advertise. If a brand cant stand on its own two feet, then there is something wrong with it. Our advertising is never a call to action. We are not advertising so we can sell more diamond rings, we are advertising so that when someone decides at some point in the future they want a piece of jewelry, they think of Boodles. Wed never have a sale if something wasnt selling. Id rather break it up and reuse the components."

Michael Wainwright
Managing director of Boodles Jewellers, U.K.

World News:

New Diamond Org. to Step-Up Marketing Efforts

The diamond industry has a new generic marketing group: The International Diamond Board (IDB). The group promises to create and sustain strong consumer demand for diamonds through effective category marketing. IDB is in the process of recruiting a chief executive. Majors involved in the group include De Beers, Rio Tinto, BHP Billiton, ALROSA and Harry Winston. IDB was initiated at the 2008 St. Petersburg Forum.

Canada, Japan Report Jewelry Sales Declines

Canadas retail sales rose 1.2 percent to $34 billion in May; however, sales for the jewelry category fell 0.7 percent, representing the fourth consecutive monthly decrease. Japans jewelry sales have slid 19 percent during the first six months of 2009, with overall department store sales falling 11 percent. Japans six-month sales decline at department stores was a new record since tracking began in 1965.

Rapaport Weekly Broadcast

The Diamond Trading Company (DTC) July sight was estimated at $350 million, 18 percent lower than June and less than half the estimate of one year ago. Some sightholders believed that supplies fell short due to production cuts. De Beers updated the industry on its production schedule, as more mining operations resume following extended care and maintenance schedules. View the broadcast.

Diamond Stats:

China’s June Diamond Imports +68%

China’s diamond imports rose 68 percent to $65.7 million in June. Imports by volume increased 63 percent to 70,100 carats.

Retail & Wholesale:

Sales Remain Weak But Retailers Did Report Some Good News

Jewelry retail sales in the U.S. are in a holding pattern, remaining at double-digit declines from one year ago, but there were still positive global developments this week in terms of new launches and retail expansion plans.

Considering the U.S. environment, it was no surprise that Birks & Mayors sales fell 26 percent to $54 million in the first fiscal quarter and same-store sales in the U.S. also dropped 26 percent. Jewelry sales at Hermes also decreased in its second fiscal quarter; however, sales of leather goods drove revenue higher by 12 percent to $635 million. Sales at Links of London rose 36 percent in 2008 to $102 million, and it is targeting growth of 28 percent this year. Dont count out the Fortunoffs and Mayrocks — they purchased all of their former intellectual property at auction for about $1.8 million and plan to relaunch the Fortunoff brand...eventually...and after a period of heavy-duty market research. A jury in Kentucky sided with jeweler Jim Jackson, deciding he didnt have to refund $800,000 for a diamond necklace that plaintiffs valued at only $500,000. U.S. consumer demand for vintage bridal jewelry has increased this year at estate jeweler Kazanjian & Fogarty, particularly for gold and platinum wedding bands, diamond eternity bands and vintage diamond rings.

Titan will open its largest Tanishq brand diamond store in Chennai, India, and aims to increase the share of its sales from diamond jewelry from 30 to 40 percent. Beards Jewellers in Cheltenham, U.K., is spending $820,000 on a store facelift to add a "touch of Bond Street" glamour. Damas unveiled its Ananyas diamond collection, which includes Tanmania sets, necklaces, pendants and earrings in 18-karat gold. Yael Designs will premiere its Mosaic diamond collection in August featuring black and white diamonds set in white gold. Abbeycrest secured funding to help manage its $3 million debt, and now plans to move upmarket in the U.K. with new branded collections Gorgeous Gold, Fluid and Osare. Weve all heard of Cash for Gold USA; well, now they have launched the Cash for Diamonds website to buy consumers diamonds. They plan to "beat" compeititors prices by 10 percent.

Kristall, Leviev Report Results; Sri Lanka Approves Deal for Nakshatra

Wholesale trade reports from Russia reveal that Kristall experienced a sales drop of 28 percent in 2008 to $241 million, and net profit dropped 35 percent to $527,000. Levievs Uralalmaz sales rose 29 percent to $30 million and profits more than doubled to $6.4 million. Levievs Ruiz Diamonds sales fell 80 percent to $61 million and profit fell 94 percent to $675,580. In Sri Lanka, the Board of Investment approved plans by Nakshatra Overseas to set up a diamond trading facility in a $1.6 million deal. Nakshatra will import rough and cut-and-polished diamonds and precious stones, and re-export them to consuming markets.

Who Is News:

Industry Players on the Move

Industry movers and shakers in the news this week include Richard Lennox, Paul Deasy, Sheldon Kwiat and Stephen Webster. Lennox first made headlines with his departure from JWT on Tuesday, but 24 hours later, Zale announced he had been hired as its new chief marketing officer. Deasy will guest-host "The Gem Insider" show on ShopNBC, where he plans to demystify gemstones in an educational and entertaining format, on July 28 and again on August 18. Kwiat was elected vice chair of YAI/National Institute for People with Disabilities. Webster was commissioned to create a one-of-a-kind diamond mosquito ring for auction to raise funds for Malaria No More U.K.

General:

Rare Diamonds from Argyle, Annenberg Go Up For Auction

Forty-three pink diamonds from the Argyle mine will hit the road as part of a worldwide tender tour. Argyle Diamonds are usually bought by jewelry connoisseurs, private collectors and celebrities. Meanwhile, the Annenberg Diamond is scheduled to be auctioned during Christies Jewels: The New York Sale on October 21, 2009. The square emerald-cut diamond is described as a 32.01-carat, D color, flawess stone, mounted as a ring and flanked by two pear-shaped diamonds of 1.5 carats and 1.61 carats. The ring, part of the collection of Leonore Annenberg, was designed by David Webb. Christies estimated its value between $3 million and $5 million.

UK Assay Offices Begin Palladium Hallmark Program

The four U.K. Assay Offices now mark palladium with a legally recognized hallmark. The recognized fineness standards for palladium will be 500 parts per thousand, 950 parts per thousand and 999 parts per thousand. Hallmarking of palladium will become a legal requirement at the beginning of 2010 for items that weigh more than one gram, but until that time it is a voluntary measure in the U.K.

Trip to Africa Proves Memorable for Kardashian, Bush, Crockett

Earlier this month, actress and model Kim Kardashian, professional football player Reggie Bush and former football star Ray Crockett traveled to South Africa and Botswana on behalf of Russell Simmons Diamond Empowerment Fund™ (D.E.F.). The trip was orchestrated to raise awareness of D.E.F. as well as to educate the celebrities about the groups empowering mission. Simmons founded D.E.F. in December 2007 to raise funds to support education initiatives that help economically disadvantaged people in African nations where diamonds are a natural resource. The celebrities and their family members visited the CIDA City Campus, which is supported by D.E.F., and the Maharishi Institute, and met with students from the African Leadership Academy. They saw firsthand how these D.E.F.-sponsored programs give children the chance to further their education and gain employment once their schooling us completed. The group also visited orphanages for HIV-positive infants.

Two Magazines Celebrate Milestones

Gems & Gemology will celebrate the journals 75th anniversary with its summer 2009 issue. The Gemological Institute of America (GIA) described the cover story of this issue as a chronicle of the publications key contributors, landmark articles and gemological milestones through the years.

American Gem Society’s (AGS) Spectra Magazine is going completely digital beginning with the July issue. Spectra’s online presence will be tested with the first few issues, to ensure that AGS members find the new format helpful and resourceful. Spectra began in 1935.

Kerala Jewelry Trade Show KGJS 2009 Runs Nov. 21-23

The Kerala business-to-business (B2B) jewelry trade show, KGJS 2009, will be held from November 21 through 23, 2009, at Le Meridian in Cochin.

GJEPC Introduces Two Initiatives to Promote Trade

The Gem & Jewellery Export Promotion Council (GJEPC) introduced two new programs — the Indian Diamond & Colour Stone Show (IDCS) and the India Diamond Jewellery Promotion (IDJP) — to promote trade in the domestic sector and strengthen Indias share of the international marketplace. IDJP begins on the first day of the Navratri festival, September 19, 2009, and lasts through February 14, 2010, and targets 1.5 million rich consumers. The IDCS show takes place August 4 and 5 at the Renaissance Hotel in Mumbai.

Mining:

Full-Year Production at BHP -4%, Namdeb +3%

BHP Billitons fiscal fourth quarter production rose 5 percent to 903,000 carats, but for the full year, production fell 4 percent to 3.2 million carats. Meanwhile, Namdebs production for 2008 rose 2.5 percent to 2.1 million carats. Profits for Namdeb rose 221 percent to $61 million due to strong prices, but that trend has been reversed this year. Namdebs sales rose 24 percent to $736 million and sales volume fell 12 percent to 1.8 million carats. The average price per carat rose 41 percent.

Two Tenders Net $17M+ in July

Trans Hex sold $16.6 million worth of rough diamonds in July at an average of $973 per carat. The sale helped push Trans Hexs cash resources up 43 percent since March, to $37.4 million. West African Diamonds (WAD) sold 433 carats of rough from its Bomboko mine in Guinea for $50,270 in Antwerp.

Palas Stake in Rockwell Drops to 9%

Pala Investments Holdings sold another round of Rockwell Diamond shares, representing approximately 3.8 percent of the total number of common shares of Rockwell currently issued and outstanding. This is the fourth such sale since late June. Palas total ownership of securities in Rockwell now stands at 8.7 percent, down from almost 20 percent one month ago.

De Beers Agrees to 9% Pay Increase

De Beers agreed to a 9 percent pay increase for its unionized workers in South Africa. Union members will will see their minimum monthly wage increase to $617 (ZAR 5,000), while miners in a higher category will receive a minimum of $1,146 (ZAR 9,277).

Minerals, Gems Keep Combatants Going

Human rights groups cite evidence that foriegn and military combatants in the diamond-rich eastern Democratic Republic of the Congo (DRC) are raising cash through illegal mining. The combatants are killing and raping civilians in the process, and without strong U.N. or government intervention, armed conflict in the war-torn region will continue.

ECON WATCH:

For week ending July 23, 2009

July.23 July.16 Chng.
$1 = Euro 0.704 0.707 -0.003
$1 = Rupee 48.5 48.6 -0.1
$1 = Israel Shekel 3.87 3.88 -0.01
$1 = Rand 7.66 8.06 -0.40
$1 = Canadian Dollar 1.10 1.12 -0.02

Precious Metals
Gold $949.30 $936.90 $12.40
Platinum $1,175.00 $1,161.00 $14.00

Stock Indexes Chng.
BSE 15,231.04 14,250.25 980.79 6.88%
Dow Jones Avg. 9,068.83 8,711.82 357.01 4.10%
FTSE 4,559.80 4,361.84 197.96 4.54%
Hang Seng 19,817.70 18,361.87 1,455.83 7.93%
S & P 500 976.27 940.74 35.53 3.78%
Yahoo! Jewelry Index 810.72 757.71 53.01 7.00%

USA
Birks & Mayors $0.40 $0.52 -$0.12 -23.08%
Blue Nile $47.62 $44.03 $3.59 8.15%
Charles & Colvard $0.39 $0.39 $0.00 0.00%
DGSE Companies, Inc. $0.91 $0.95 -$0.04 -4.21%
Fuqi International $22.26 $20.38 $1.88 9.22%
JCPenney $29.49 $28.62 $0.87 3.04%
Kohls $48.93 $46.06 $2.87 6.23%
Lazare Kaplan $2.50 $2.68 -$0.18 -6.72%
LJ International $2.02 $1.85 $0.17 9.19%
Macys $13.24 $11.79 $1.45 12.30%
Man Sang $2.24 $2.01 $0.23 11.44%
Movado Group $13.66 $11.52 $2.14 18.58%
Nordstrom $25.76 $21.79 $3.97 18.22%
Saks $4.59 $4.38 $0.21 4.79%
Signet $22.10 $21.30 $0.80 3.76%
Sothebys $13.90 $13.44 $0.46 3.42%
Tiffany $29.56 $27.68 $1.88 6.79%
Wal-Mart $48.78 $48.51 $0.27 0.56%
Zale $4.85 $4.06 $0.79 19.46%

EUROPE
Bulgari €3.92 €3.70 €0.22 5.95%
Bijou Brigitte €101.50 €96.90 €4.60 4.75%
Esa €2.82 €2.85 -€0.03 -1.05%
LVMH €61.85 €57.40 €4.45 7.75%
Pinault P-R SA €65.50 €59.58 €5.92 9.94%
Richemont SA CHF 26.00 CHF 23.92 CHF 2.08 8.70%
Swatch Group CHF 184.70 CHF 170.00 CHF 14.70 8.65%
Theo Fennell (pence) 47.50 46.65 0.85 1.82%

INDIA (rupee)
Classic Diamond 15.20 14.75 0.45 3.05%
Gitanjali Gems 98.95 98.20 0.75 0.76%
Rajesh Exports 40.20 38.20 2.00 5.24%
Ren. Jewellery 40.55 38.95 1.60 4.11%
Su-Raj Diamonds 34.45 33.25 1.20 3.61%
Titan 1,311.30 1,195.70 115.60 9.67%
Zodiac JRD 16.55 14.55 2.00 13.75%
Suashish Diamonds 177.00 175.00 2.00 1.14%

NEW ZEALAND
Michael Hill NZD 0.67 NZD 0.64 NZD 0.03 4.69%

MINING STOCKS
(pence unless noted)
USA
Anglo American $15.89 $14.72 $1.17 7.95%
CANADA
Harry Winston CAD 5.94 CAD 6.50 -CAD 0.56 -8.62%
Mountain Province CAD 1.65 CAD 1.76 -CAD 0.11 -6.25%
Peregrine Diamonds CAD 0.70 CAD 0.76 -CAD 0.06 -7.89%
Rockwell Diamonds CAD 0.04 CAD 0.04 CAD 0.01 14.29%
Shore Gold CAD 0.50 CAD 0.52 -CAD 0.02 -3.85%
Stornoway Diamond CAD 0.13 CAD 0.14 -CAD 0.01 -3.70%
True North Gems CAD 0.13 CAD 0.14 -CAD 0.01 -3.70%
UK (pence)
African Diamonds 31.5 28.8 2.8 9.57%
BHP Billiton 1,562.0 1,435.7 126.3 8.80%
Firestone Diamonds 25.8 26.5 -0.8 -2.83%
Gem Diamonds 184.3 169.3 15.0 8.86%
Gemfields 7.0 6.8 0.2 2.49%
Mano River 6.4 3.8 2.6 70.13%
Mwana Africa 5.7 4.1 1.6 38.05%
Namakwa Diamonds 36.0 30.5 5.5 18.03%
Petra Diamonds 35.8 36.0 -0.3 -0.69%
Rio Tinto plc 2,410.0 2,080.5 329.5 15.84%

Rapaport TradeWire - Friday, July 31, 2009
News: Caution - polished prices softening with some discounts exceeding 40% below list. Rough price bubble has developed as recent rough price increases appear unsustainable and may have been fueled by too much Indian bank credit. Demand for rough slows as Indian cutters resist high prices amid concerns that Russia’s ALROSA plans to sell $2 bil. in 2H 2009. Global markets slow as summer vacations begin. De Beers Group 1H sales -54% to $1.7 bil., net earnings -99% to $3 mil., production -73% to 6.6 mil. cts. LMVH Moet Hennessy Louis Vuitton watch & jewelry sales -17% to $491.3 mil., profits -73% to $28.4 mil. Gitanjali Gems 1Q sales +11% to $279 mil., profits +9% to $9 mil. Christie’s 1H jewelry, jadeite, watch sales -53% to $129.6 mil. China’s 1H polished diamond imports +12.7% to $300 mil. Moti Ganz re-elected chairman of Israel Diamond Institute.

ANNOUNCEMENTS:

RAPAPORT INTERNATIONAL DIAMOND CONFERENCE

Sept. 10, 2009, New York – 8:30 am to 5:00 pm

Conference Topic:
“New Realities - Where do we go from here?”

The conference will be held at the new
New York Times Center, 242 West 41 St.

Reservations will be strictly limited to first 320 tickets.
$249 until August 15, $349 thereafter if tickets available.
Lunch not included, but we can arrange restaurant reservations.

Register online www.diamonds.net/idc
or call +1-702-893-9400

Retail Quote:

“I’m not sure that the worst is over. Cartier will resist better than many other companies. I think fashion brands, ‘bling-bling’ types of brands, will suffer more than we will. We will do anything to protect the employment. We will do anything to protect our company. We will lose a bit of turnover. We were maybe more ready than other companies for this big recession, and therefore already have taken a few actions so we wouldn’t be too much hit.”

Arnaud Bamberger
Managing director for Cartier U.K.
Cie. Financiere Richemont

World News:

De Beers 1H Sales -54%, Profits -99%

De Beers Group reported that its first-half sales dropped 54 percent to $1.7 billion, and net earnings plunged 99 percent to $3 million. De Beers registered underlying losses — i.e., operating losses — of $164 million, compared with underlying earnings of $350 million one year ago. First-half sales for the Diamond Trading Company (DTC) fell 57 percent to $1.4 billion. De Beers noted that the sales decline was "due to reduced purchases by sightholders as they worked to reduce inventory levels and increase liquidity in the face of the global economic downturn." Production fell 73 percent to 6.6 million carats as many mining operations were placed on care and maintenance during the first quarter. Subsequently, though, all except one mine have resumed operations, according to De Beers. For the full year, De Beers predicts production will be half that of 2008.

Shareholders provided $500 million in additional subordinated loan funding during the period, bringing total loans to $817 million before International Financial Reporting Standards (IFRS) interest adjustments. The company stated that it is working with banks to renew a $1.5 billion term loan, which expires in March 2010. Net debt as of June 2009 was at $4.1 billion, up from $3.8 billion in December.

ALROSA Plans $2B Diamond Sales in 2009

ALROSA is planning to sell $2 billion worth of diamonds in 2009. There is a $500 million distribution agreement in place with 15 Antwerp-based companies, an additional $50 million in rough has recently been contracted for sale, and a portion of goods will be sold to the Gokhran. Additionally, ALROSA expects deals with Russian and foreign companies.

Rapaport Weekly Broadcast

Observations from the JA New York summer show found the number of exhibitors and attendees were an improvement from the winter show and about on par with the summer show of 2008. Trading activity was sluggish though and buyers were extremely conservative. Retail buying habits reflected a cautious and very selective counter space, given double-digit drops in consumer jewelry spending. The new designers gallery and New Design Lab at the JA show was a popular destination. Stay tuned for indepth coverage of the new designers section with an upcoming video presentation.

http://www.diamonds.net/news/NewsItem.aspx?ArticleID=27319

DIAMOND STATS:

Shanghai Diamond Exchange Trading Volume +7% in 1H09

The Diamond Administration of China reported that trading volume — total import, export and inter-member transactions — on the Shanghai Diamond Exchange (SDE) during the first half of 2009 rose 6.9 percent to $692 million. Polished diamond imports rose 12.7 percent to $300 million, making China the third-largest diamond consuming nation, behind the U.S. and Japan.

RETAIL & WHOLESALE:

For the third consecutive week, weekly chain store sales in the U.S. remained slightly down from one year ago, according to the chain store sales snapshot produced by the International Council of Shopping Centers (ICSC) and Goldman Sachs. In the seven days that ended July 25, 2009, ICSC reported a 0.5 percent drop in weekly chain store sales from the same period in 2008. Diamond and jewelry sales results reflected continued difficult market conditions in the U.S. and Europe, with mixed results from India.

While LVMH Moët Hennessy Louis Vuitton reported that its first-half revenue rose 0.2 percent to $11.1 billion, sales for its jewelry division fell 17 percent to $491.3 million. The luxury retailers profits dropped 23 percent to $975.5 million, and profits from the jewelry division declined 73 percent to $28.4 million. Christie’s jewelry, jadeite and watch sales were down 38 percent to $129.6 million in the first half of 2009. The bright spot in jewelry sales was Gitanjali, which reported that net sales in its first fiscal quarter grew 11 percent to $279.2 million, and net profit rose 9 percent to $9.4 million. Diamond segment sales rose 5 percent to $149.4 million, and jewelry sales increased 38 percent to $137 million. Asian Star reported that net sales fell 11 percent to $63.7 million and net profits declined 38 percent to $1.5 million, for its first fiscal quarter. Sales of cut and polished diamonds fell 10 percent to $61.8 million, and jewelry sales decreased 38 percent to $2.9 million.

In the wholesale trade, ZY Bernstein Ltd. and RGS Diamonds Ltd., fancy-cut diamond manufacturers, formed a joint venture called Diamond Dimensions to market custom-designed diamonds. The venture has already launched two new patented designs — the "lotus cut" and the "cross cut." The lotus cut has two different versions: one with three leaves and one with four leaves, both with "concept tokens" that produce the image of a lotus flower. The cross cut forms the shape of a cross, which comes in five different versions.

WHO IS NEWS:

Moti Ganz was reelected for a three-year term as chairman of the Israel Diamond Institute (IDI) group of companies. Ganz owns MOTIGANZ Diamond Group in Israel and has been active in the industry since 1989. Frederick Goldman appointed Liz Richardson, formerly of Charles & Colvard, as its vice president of sales for key accounts in the U.S. Former U.S. diplomat Mike OKeefe was sentenced to one year in prison, and Sunil Agrawal, the chief executive of STS Jewels, was given probation plus a $100,000 fine, in a federal case involving bribes for visas. OKeefe expedited 21 visas for STS in exchange for jewelry and vacations with female strippers. Suzanne Somers will bring her jewelry, fashion, and furnishing products to the ShopNBC network in third quarter 2009. Former Zimbabwe politician Enos Nzombi Nkala claims that his successor as Defence Minister, Moven Mahachi, was killed for opposing ZANU-PF (President Robert Mugabes party) unbridled looting of diamonds in the Democratic Republic of the Congo.

GENERAL:

The Kimberley Process reportedly told Zimbabwe it must address abuses in its diamond fields, and recommended halting diamond trading until the country meets minimum standards, according to the Harare Herald.

The poor economy dealt another blow to the trade as the American Gem Trade Association closed its AGTA Gemological Testing Center on July 29, 2009. All gemstones in the laboratory will be returned to clients as quickly as possible.

Diamond MINING:

In the absence of a cash injection from its two shareholders, Namdeb will retain $6.4 million (NAD 51 million) in dividends that it had planned to pay to De Beers and the government, hoping to improve cash reserves. Additionally, Namdeb has sought a royalty waiver, worth about $71.4 million (NAD 565 million), but the government has not ruled on this request. Namdebs outlook remains cautious for the rest of 2009. Rough demand and liquidity across the manufacturing sector have improved slightly.

A study by the Bench Marks Foundation concluded that there is a contradiction between what diamond mining firms say about their corporate social responsibility (CSR) schemes and the actual benefits derived from diamond mining at the community level. The study measured the CSR metrics of De Beers, Alexkor and Trans Hex, and the CSR results from Port Nolloth, Hondeklip Bay and Kleinzee in western South Africa. Bench Marks took issue with water and electrical shortages for communities that De Beers served; workers reported financial issues with state-run Alexkor; and citizens complained about environment damage from Trans Hex activities. De Beers said that it agreed with the reports generic recommendations and would study it further to improve its contribution to the region.

Endiama agreed that the treatment of illegal miners deported from the north of the country must be improved. Angola has been rounding up and deporting illegal immigrants — mostly from the Democratic Republic of the Congo (DRC) — in a bid to control the high numbers of artisanal miners known as "garimpeiros." Angola plans to introduce licenses for artisanal miners by the end of the year in order to regulate the situation.

econ watch:

For week ending July 30, 2009
July.23 July.23 Chng.
$1 = Euro 0.710 0.704 0.006
$1 = Rupee 48.34 48.47 -0.1
$1 = Israel Shekel 3.78 3.87 -0.09
$1 = Rand 7.82 7.66 0.16
$1 = Canadian Dollar 1.09 1.10 -0.01

Precious Metals
Gold $933.70 $949.30 -$15.60
Platinum $1,183.00 $1,175.00 $8.00

Stock Indexes Chng.
BSE 15,387.96 15,231.04 156.92 1.03%
Dow Jones Avg. 9,154.23 9,068.83 85.40 0.94%
FTSE 4,631.61 4,559.80 71.81 1.57%
Hang Seng 20,234.08 19,817.70 416.38 2.10%
S & P 500 986.73 976.27 10.46 1.07%
Yahoo! Jewelry Index 815.19 810.72 4.47 0.55%

USA
Birks & Mayors $0.40 $0.40 $0.00 0.00%
Blue Nile $45.45 $47.62 -$2.17 -4.56%
Charles & Colvard $0.39 $0.39 $0.00 0.00%
DGSE Companies, Inc. $0.88 $0.91 -$0.03 -3.30%
Fuqi International $22.95 $22.26 $0.69 3.10%
JCPenney $29.41 $29.49 -$0.08 -0.27%
Kohls $49.35 $48.93 $0.42 0.86%
Lazare Kaplan $2.50 $2.50 $0.00 0.00%
LJ International $2.18 $2.02 $0.16 7.92%
Macys $13.60 $13.24 $0.36 2.72%
Man Sang $2.30 $2.24 $0.06 2.68%
Movado Group $14.55 $13.66 $0.89 6.52%
Nordstrom $25.50 $25.76 -$0.26 -1.01%
Saks $5.23 $4.59 $0.64 13.94%
Signet $21.86 $22.10 -$0.24 -1.09%
Sothebys $14.91 $13.90 $1.01 7.27%
Tiffany $29.75 $29.56 $0.19 0.64%
Wal-Mart $49.96 $48.78 $1.18 2.42%
Zale $5.56 $4.85 $0.71 14.64%

EUROPE
Bulgari €4.00 €3.92 €0.08 2.04%
Bijou Brigitte €99.61 €101.50 -€1.89 -1.86%
Esa €2.65 €2.82 -€0.17 -6.03%
LVMH €64.00 €61.85 €2.15 3.48%
Pinault P-R SA €71.05 €65.50 €5.55 8.47%
Richemont SA CHF 26.70 CHF 26.00 CHF 0.70 2.69%
Swatch Group CHF 198.30 CHF 184.70 CHF 13.60 7.36%
Theo Fennell (pence) 49.50 47.50 2.00 4.21%

INDIA (rupee)
Classic Diamond 16.15 15.20 0.95 6.25%
Gitanjali Gems 110.50 98.95 11.55 11.67%
Rajesh Exports 41.05 40.20 0.85 2.11%
Ren. Jewellery 40.10 40.55 -0.45 -1.11%
Su-Raj Diamonds 38.05 34.45 3.60 10.45%
Titan 1,211.35 1,311.30 -99.95 -7.62%
Zodiac JRD 16.05 16.55 -0.50 -3.02%
Suashish Diamonds 186.10 177.00 9.10 5.14%

NEW ZEALAND
Michael Hill NZD 0.66 NZD 0.67 -NZD 0.01 -1.49%

MINING STOCKS
USA
Anglo American $15.58 $15.89 -$0.31 -1.95%
CANADA
Harry Winston CAD 5.97 CAD 5.94 CAD 0.03 0.51%
Mountain Province CAD 1.77 CAD 1.65 CAD 0.12 7.27%
Peregrine Diamonds CAD 0.65 CAD 0.70 -CAD 0.05 -7.14%
Rockwell Diamonds CAD 0.04 CAD 0.04 CAD 0.00 0.00%
Shore Gold CAD 0.54 CAD 0.50 CAD 0.04 8.00%
Stornoway Diamond CAD 0.12 CAD 0.13 -CAD 0.01 -7.69%
True North Gems CAD 0.13 CAD 0.13 CAD 0.00 0.00%
UK (pence)
African Diamonds 32.75 31.50 1.3 3.97%
BHP Billiton 1,576.00 1,562.00 14.0 0.90%
Firestone Diamonds 26.32 25.75 0.6 2.21%
Gem Diamonds 195.00 184.25 10.8 5.83%
Gemfields 7.00 7.00 0.0 0.00%
Mano River 6.53 6.38 0.2 2.35%
Mwana Africa 5.90 5.66 0.2 4.24%
Namakwa Diamonds 36.50 36.00 0.5 1.39%
Petra Diamonds 33.75 35.75 -2.0 -5.59%
Rio Tinto plc 2,462.00 2,410.00 52.0 2.16%

india market report:

Kto má záujem môže ísť na konferenciu.

Rapaport International Diamond Conference
Thursday, September 10, 2009 – The Times Center, 242 West 41st Street, New York

Dear Friends,

I am sending you this personal email to encourage your participation in the Rapaport International Diamond Conference. It’s not about our making money - all the conference proceeds are donated to charity. It is about what Rapaport can do to help you navigate challenging times and identify opportunities that will help you succeed in the year ahead.

The goal of the conference is to sharpen your strategic thinking through analysis of the most important issues facing the diamond and jewelry industry. The big idea is that if you understand what is going on you will be able to position yourself and identify opportunities that will increase your profits. Simply put knowledge is power and now, during these challenging times we need all the knowledge and power we can get.

So seize the day, join us and sign up for the conference at www.diamonds.net/idc. You can also register via email idc@diamonds.net or phone +1-702-893-9400. Looking forward to seeing in New York.

Yours truly,

Martin Rapaport

Click here to register for IDC: www.diamonds.net/Conference/2009/Register

Conference Topics and Speakers

New Economy and the Jewelry Industry: From Rough to Retail
Des Kilalea, Royal Bank of Canada

Christopher Ellis, Consensus Advisors

New Consumer Markets: The India Story
C.K. Venkataraman, COO Tanishq

Mehul Choksi, Chairman Gitanjali

Riding the Wave of Change
Martin Rapaport, Chairman Rapaport Group

The Big Stone Market: 47th Street Perspectives
Ronald Friedman, President DMIA

Moshe Mosbacher, President NY DDC

And leading diamond manufacturers

Human Rights and the Diamond Industry:

What can and should we do?

Ian Smillie, Chairman, Development Diamond Initiative (DDI)
Georgette Gagnon, Human Rights Watch - Director Africa Division

Brad Brooks-Rubin, U.S. State Department.

Eli Izhakoff, Chairman, World Diamond Council (WDC)
Cecilia Gardner, President Jeweler’s Vigilance Committee
Matt Runci, President of Jeweler’s of America and Responsible Jewelers Council (RJC)

Additional and updated information available at www.diamonds.net/idc

Click here to register for conference: https://www.diamonds.net/Conference/2009/Register

This email sent to djkokavec@orangemail.sk by The Rapaport Group, 133 E Warm Springs Road, Las Vegas, Nevada, 89119. You are receiving this email because you subscriber to a Rapaport information product or service. Please email stopmail@diamonds.net to remove your name from the Tradewire mailing list