RAPAPORT… India’s Gem Jewellery Export Promotion Council (GJEPC) is celebrating 50 years by hosting leaders from across the diamond industry. Rapaport News presents live updates from the two-day conference covering mining, manufacturing, marketing and politics.
5:30 a.m. EST: Trade, Miners Clash on Marketing Programs
Marketing of diamonds will only lead to more profits for rough producers and barely help the midstream other than by moving goods down the pipeline more efficiently, argued Rajiv Mehta, CEO of India-based diamond manufacturer Dimexon Diamonds.
“I don’t believe marketing is going to solve our profitability problems,” Mehta said in a panel discussion on mining.
Jim Pounds, executive vice president of Dominion Diamond Corporation, argued that better marketing would have a positive effect on the whole sector, while industry analyst Chaim Even-Zohar said diamond marketers needed to up their game significantly.
“If you see the Swarovski advertising, it’s scary. It’s so clever,” he said. “If you see some of the advertising videos the synthetic diamond producers make, if we were to play that here, everyone would walk out and go and buy synthetics.”
Paul Rowley, executive vice president of global sightholder sales at De Beers, said De Beers had invested in its Forevermark brand in the hope that it would have a positive effect on the image of the whole industry.
“But we realized the industry needed more, which is why the company is investing in the Diamond Producers Association,” Rowley said.
4:30 a.m. EST: Polyakov Downgrades ‘No-Value’ Synthetics
Andrey Polyakov, vice president of ALROSA and president of the World Diamond Council, dismissed the notion that synthetic diamonds held the same value as natural diamonds. The entire value of diamonds comes from their age and history, he argued, adding that synthetics had no geological history.
“Their producers cannot even claim that they are clones of something with worth,” Polyakov said. “Indeed, they are clones of something with no value at all.”
4 a.m. EST: De Beers Exec Urges Focus on Consumer Confidence
Paul Rowley, executive vice president of global sightholder sales at De Beers, highlighted the need to raise consumer confidence by increasing transparency across the diamond pipeline. The industry needs to understand the end consumer and engage in providing information to ensure the industry supplies according to consumers’ exact needs, he asserted.
He defended De Beers against claims that it was squeezing midstream profitability, noting that times were challenging for the entire industry.
3:30 a.m. EST: Analyst to India: Get Profitability Back
Industry analyst Chaim Even-Zohar argued that De Beers production and pricing policy had resulted in tight profit margins among manufacturers and dealers. He told the Indian trade to put “India First” and take a strong negotiation position with miners to restore margins.
“You have enormous power – use it to get profitability back,” he told the audience.
3 a.m. EST: Mining Minister Calls for New Game Plan
Piyush Goyal, India’s minister of power, coal and renewable energy and mines, assured his Zimbabwean counterpart, Walter Chidakwa, that India would work in the coming year to ensure the safety of the people of Africa. India will never think of exploiting Africa, but will work to supplement it, he said.
Goyal also expressed a desire to change the current environment in which miners have concerns about operating in India. “This is an area where India plans to change the rules of the game,” Goyal said. “We’re going to explore the breadth of this country with an honest, transparent bidding process, and the proceeds will go to the poor of this country. We don’t want to say we ran out of diamonds in the 18th century, but that in India, diamonds are forever.”
2:35 a.m. EST: GJEPC Vice-Chair: India’s Trade Must Clean Up Its Act
Russell Mehta, vice chairman of the GJEPC and CEO of Rosy Blue India, pointed to the lack of significant profit margins in the manufacturing sector and cautioned that volatility was the new normal. He also predicted that synthetic diamonds would gain a share of the natural diamond market. Mehta stressed that the industry would have to embrace transparency and align with Indian Prime Minister Narendra Modi’s push toward a cleaner economy, free of corruption.
2:20 a.m. EST: Zimbabwe Urges India to Help Africa
Walter Chidakwa, Zimbabwe’s minister of mines and mining development, stressed that the industry must do more to ensure that Africa benefits from its resources, and appealed to India to support initiatives on the continent. Just as Belgium extended expertise and financial support to India’s trade, India should do the same for Africa’s diamond industry, the minister said.
1:45 a.m. EST: GJEPC’s Pandya Stresses Need for Higher Polished Prices
Praveenshankar Pandya, chairman of the GJEPC, welcomed guests, saying the event would tackle both opportunities and challenges facing the industry, among them marketing, compliance and finance.
He called on Piyush Goyal – India’s mining minister, who also addressed the opening session – to enable the development of India’s two prospective diamond mines. “We want to be able to extract the diamonds we manufacture and export,” Pandya said.
Pandya encouraged the industry to work collectively toward higher polished prices, noting the pressure facing the midstream in recent years.
The banks are wary because prices are not rising, and sometimes there has been excessive supply, leading to high interest rates from banks, he explained. There has to be a realignment, Pandya warned, calling for greater cooperation between the miners and the trade.
Pandya also endorsed the work of the Diamond Producers Association, urging miners to provide it with financial support so it could successfully increase demand.