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The War of the Diamonds

Published on May 21, 2023

So far the embargo on Russian diamonds hasn’t worked too well. In the future, however, things could change and the price of the gems most loved by women would inevitably become higher. The war in Ukraine unleashed by Russia had already provoked, in 2022, the announcement of an embargo against the exports of Alrosa, the Russian state diamond giant. But, in fact, precious stones continued to arrive in the West too, due to the difficulty of tracing the gems. In fact, rough diamonds are sold in countries such as India or Thailand, which do not adhere to the stop decided by Western countries on Russian stones. Europe alone in 2022 imported Russian diamonds for 1.4 billion euros. A considerable figure, albeit down from 1.8 billion in 2021.

Expertise in un laboratorio Tiffany — Expertise by Tiffany

Something could change after the G7, the meeting of the major industrialized countries, if China is not taken into account. In Japan, the heads of state of the G7 countries have decided to tighten controls more to reduce one of the sources of income of the Russian state. And Great Britain has announced that it will immediately leave Russian diamonds outside the borders, together with other metals that are exported from Moscow. Russia is now the world’s largest producer of diamonds. The problem, however, is how to control the stone market, which largely passes through channels that are difficult to monitor.

Anversa: acquisti di un buyer — Antwerp, buyer

Where the traces disappear

The biggest obstacle comes from the steps related to processing. While the extracted diamonds are easily controlled, also thanks to the Kimberley Process, a path that certifies the origin of the gems, precisely to prevent them from financing warring countries or factions, the problem comes later. Cutting and polishing rough stones can make traces of provenance disappear. Furthermore, the idea of a real embargo opposes those countries, such as Israel or Belgium, which are the major centers where diamonds are cut.

Diamanti taglio brillante — Brilliant cut diamonds. Copyright: jewels.com

On the other hand, those who have everything to gain from a stop at Alrosa are the producers of gems created in the laboratory, who can benefit from an inevitable increase in the price of natural diamonds. Synthetic diamonds, which are chemically the same as those extracted in mines, already cost much less than natural ones. If the price gap widened further, the advantage would be greater.

Lavorazione dei diamanti alla Dimexon, India — Diamond Processing at Dimexon, India

Esame di diamanti ad Anversa — Diamond examination in Antwerp

War splits the Responsible Jewelery Council

Published on April 2, 2022

news

Il diamante trovato nella miniera di Karowe, in Botswana

The war unleashed by Russia in Ukraine is also upsetting the world of diamonds. After the measures against Alrosa (a Russian mining company) decided by the United States, it is the Responsible Jewelery Council that split. And Iris Van der Veken, executive director of the Rjc, an association with about 1,500 members that sets the standards of the diamond supply chain, has resigned. In fact, the association has so far avoided suspending Alrosa.

The only change noted, in fact, is the resignation from the position of vice president of the RJC of the CEO of Alrosa, Sergey Ivanov. But the company, controlled by the Russian government, remained among the partners. The lack of a suspension has displeased many. Starting with Pandora, which is also the largest jewelry company in the world, which announced its decision to leave the organization due to RJC’s failure to suspend Russian companies (not just Alrosa) and urged its members to interrupt business with the country: “Pandora cannot , in good faith, be a member of an association that does not share our values, “said the CEO of the Danish group, Alexander Lacik.

A few hours later, the communication from the Richemont group (Cartier, Van Cleef & Arpels and Buccellati) also arrived, which specified that they did not wish to be members of “a sector organization that includes companies that contribute to the financing of conflicts and wars “. Two exits of weight, in short. Will others follow?

Does war raise the cost of diamonds?

Published on March 27, 2022

news

Il diamante è stato ricavato da una pietra grezza di 179 carati

Will the war in Ukraine also raise the price of diamonds? The question is legitimate. In fact, Alrosa, a state-controlled mining giant that controls 90% of the country’s production and is the first mining company in the world, has also been targeted by sanctions against Russia. To give an idea of the size: in 2021 Alrosa sold 32.4 million carats of rough diamonds, which is equivalent to almost 30% of world production. In short, one in three diamonds comes from Russia. And the CEO of Alrosa, Sergey Ivanov, is on the list of rich Russian billionaires who have been targeted by sanctions.

Among other things, he is the son of former Defense Minister Sergei Ivanov, a close associate of President Vladimir Putin and is also a board member of Gazprombank, an emanation of the oil and gas giant. As a reaction, Alrosa has suspended its membership of the Natural Diamond Council, a market alliance of the world’s leading producers of precious stones.

At the same time, however, the Russian state also controls a secret reserve of diamonds, the Gokhran, which it uses to stabilize prices and to generate revenue in times of crisis. In addition, Alrosa has so far bypassed US sanctions and has managed to ensure a smooth flow of diamonds to India, where a good number of diamonds are polished and cut, around 10%. But Tiffany, for example, has just announced that it will no longer buy diamonds from Russia.

Il diamante brown di Alrosa da 27,02 carati utilizzato per una collana di Anna Hu — Il diamante brown di Alrosa da 27,02 carati utilizzato per la collana di Anna Hu

There is, then, another factor to take into account: in the days preceding the sanctions many of the so-called oligarchs or, at least, a good number of rich Russians rushed to jewelers all over the world, but in particular in the Emirates, to buy jewels and stones. It is an easily transportable asset and, unlike the bank account, it can hardly be identified and seized. Conversely, a diamond can be easily resold anywhere in the world, even if the credit card is blocked. In short, a diamond is a kind of insurance policy in difficult times. But, of course, many purchases also mean price strain. Not to mention that for years there have been Russian criminal groups operating in Europe and the US and using diamonds to launder their illicit profits. An operation that could be further encouraged by the climate of war.

Diamante nel laboratorio Tiffany di Anversa

All this worries companies specializing in diamond processing. The Antwerp World Diamond Center has suggested that the restrictions may prove detrimental to the sector, as Russia can continue to sell diamonds to countries such as India and China. True. But it is certainly not easy to quickly replace the Antwerp specialists in the delicate work of diamond cutting. And Russia sells diamonds rough.
A problem, in any case, which adds up to very small stocks of diamonds: according to Bain & Company, in the coffers of the operators at the beginning of the year, before the war, the stocks had decreased by about 40%, driven by the high demand and the slow resumption of production. In short, there were already fewer diamonds in circulation. And now giving away the classic solitaire is likely to be much more expensive.

Boom of demands for diamonds

Published on January 30, 2021

news/Diamanti

Diamonds: is it worth investing in women’s best friend stones? The question recurs and the answer is always the same: it depends. A few years ago, some companies that, including through banks, sold diamonds to those who wanted to invest their savings, presenting them as a safe choice, ended up in court. Wrong, because the price of diamonds varies, it does not grow by divine law and, once purchased, it is also necessary to find those who buy back the diamonds. That said, it should be noted that the crisis due to the coronavirus pandemic seems to have had a positive effect on the diamond market.

The world diamond trade has spent years in doldrums, but after to be paralyzed by the pandemic, things started to improve. Now business is booming. Bloomberg, an American agency specializing in financial news, explained this in a long analysis. As the report tells, Indian carvers in the Indian city of Surat, one of the world’s centers of diamond processing, are desperate for an increase in production. The most skilled polishers are in contention among factories with 50% wage increases, free food and housing. India, where about 90% of diamonds are cut or polished, imported nearly $ 2 billion in rough diamonds last month
The reason is that the demand for diamonds in the market has soared. De Beers, one of the largest producers of the stone, has already raised the prices of diamonds and the rival company, Alrosa, has predicted that the price of precious stones will rise again.

Why did this boom happen? The causes indicated by analysts are different: exceptional sales of jewelry during the Christmas period, particularly in the United States and China. Reduced or eliminated luxury travel, often forced to stay at home or to restrict travel, those who do not have economic problems have poured out luxury shopping on precious objects. According to an Alrosa manager, online sales of diamond jewelry have almost doubled and reached around 20% of the total.

store cinese shenyang — Inaugurazione di uno store Tiffany a Shenyang, in Cina

And this trend has the effect of increasing the demand for polished diamonds, those used for jewelry. So do you have to rush to buy diamonds? Warning: some industry players, Bloomberg reports, also fear that the market is overheating, and there is a risk of a collapse later in the year. The reason: Annual demand for diamond jewelry had stagnated, estimated at around $ 80 billion, over the past five years, and gem brokers were struggling to make a profit. And if, thanks to vaccines, the pandemic were to be quickly defeated, consumption could return to pre-covid rhythms.

Selezione dei diamanti nel laboratorio di Antwerp (Anversa) — Selezione dei diamanti nel laboratorio Tiffany di Antwerp (Anversa)

But, for now, this is not the case. One of the big American jewelry chains, Signet Jewelers, reported a 7.8% increase in holiday sales in North America. And in China, the second largest market in the world, another big name in the industry, Chow Tai Fook, saw an 18% increase in quarterly sales. De Beers and Alrosa both responded to demand by raising prices, trying to make up some of the ground lost last year when demand plummeted. In short, for now the boom continues.

The fluorescent diamonds of Luminous Diamonds

Published on December 13, 2020

Rings/Showroom

Diamond earrings that shine more than the others, a ring that attracts the eye thanks to its blue hue: these are the chances offered by fluorescence (we talked about it here). And now comes the jewels capable of exploiting this rare prerogative: they are those of Luminous Diamonds, a brand owned by Alrosa, a large Russian mining group which is one of the largest producers of diamonds. While it is true that all diamonds shine, not all gems have a fluorescence. In fact, diamonds with this property are rare: less than 6% of the gems mined from the earth have medium to very strong fluorescence, and less than 0.5% are very strong. This property also shows itself when the diamond is hit by UV light: in this condition the stones emit a visible blue tint.

Fluorescence is caused by the presence of specific elements and their arrangement in the crystal structure of the diamond, for example when nitrogen atoms form perfect triangular patterns interacting with UV light. The Luminous Diamonds brand is in its debut and is preparing to sell worldwide, leveraging the internal glow of the gems, which should provoke a wow effect.

Anello in oro bianco e diamanti con effetto fluorescenza

Anello in oro bianco e diamanti di Luminous Diamonds

Orecchini in oro bianco e diamanti di Luminous Diamonds con effetto fluo

On auction a 51-carat Russian diamond

Published on August 3, 2017

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Il diamante Romanov a taglio rotondo, tradizionale, con 57 sfaccettature

A super Russian diamond (plus five more) dedicated to the tsars ♦ ︎
The Russian mining group Alrosa announced for November an auction for the sale of a rare collection of already cut diamonds, including a giant stone of 51.38 carats. It’s one of the biggest diamonds ever put on the market. It is a round, traditional, 57-facettes diamond with a diameter of 1 inch (2.5 inches) big about the size of a man’s eye. According to Alrosa, which is a State-controlled company, is probably the most expensive diamond produced in the history of Russian jewels. The diamond is one of the five pieces made of the 179-carat Romanov raw diamond, extracted in 2015 in one of the mines of the company in the Yakutia region, in the Far East of Russia. In intentions all diamonds should be sold together with no less than $ 10 million. The Romanov name is a dedication to Tsar Peter the Great, who built the city of St. Petersburg and the Romanov dynasty, which ruled Russia for 300 years. Federico Graglia

Il diamante di Alrosa ha un diametro da 1 pollice (2,5 centimetri)