You’ll hear JCK editor-in-chief Victoria Gomelsky and news director Rob Bates talk about the 24 Karat Weekend, including the Gem Awards; updates about crime stats from the Jewelers’ Security Alliance lunch; and some news that broke at the Jewelers Vigilance Committee luncheon. A discussion follows of a potential increase in restrictions on Russian diamond imports and the complexities of this issue. Victoria asks Rob about his take on falling lab-grown diamond prices. She also shares some insights she gained from a presentation on differences in lab-grown diamond quality and how those variances occur. Finally, the hosts touch on recent events with banks and their impact on the industry.
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01:45 24 Karat weekend
05:00 U.S. sanctions on Russian diamonds
13:00 Lab-grown diamond prices
15:00 Lab-grown diamond quality variance
23:00 Silicon Valley Bank
24 Karat Weekend
Rob attended the 24 Karat Gem Awards, while Victoria sadly had to stay home. It was a beautiful event, which included a lovely tribute to the late Steven Kaiser. JCK writer Amy Elliott was up for a media award. Victoria and Rob give a big shout-out to Amy, and express their pride at her nomination. And they congratulate National Jeweler’s Michelle Graff, who won this year’s media award.
Rob also attended the Jewelers’ Security Alliance (JSA) lunch, where it was reported that last year was the worst for crime that JSA has seen in a very long time. On the lighter side of things, Rob enjoyed Joe Piscopo’s performance at the 24 Karat dinner (lots of Sinatra).
At the Jewelers Vigilance Committee (JVC) luncheon, Jeffrey Fisher was presented the Stanley Schechter Award in a warm, emotional ceremony. The speaker at the luncheon was Ambassador James C. O’Brien, head of the U.S. Office of Sanctions Coordination. He gave an effective, folksy speech about the U.S. efforts to put sanctions on Russia.
Stricter Russian diamond sanctions on the horizon
The G7 wants to put further restrictions on Russian diamonds to close the “substantial transformation” loophole, which allows Russian diamonds that are cut and polished elsewhere to come into the U.S. One thing being looked at is requiring sellers to make a declaration that the diamonds they are selling are not from Russia. This would be a big change in the market.
In a brief interview with O’Brien following his speech, Rob asked what happens if people don’t have the proper information about Russian origin. O’Brien said you can get into a lot of trouble if you aren’t honest with Customs officials. There are still questions about many of the details, including what the size cutoff would be and what type of proof would be required. Rob warns that the changes are on the horizon, and it will have a big effect on the industry.
Rob gives a little context for these changes: Belgium has been under pressure to block imports of Russian diamonds. But Belgium’s argument has been that if Russian diamonds just go to Dubai and then the U.S., Belgium will lose out. But if the U.S. market is closed off, then Belgium is on an even playing field with Dubai. The sanctions proposal is due to be presented at the G7 conference in May and then put into action after. Rob hopes there will be a clear set of rules that are attainable and easy to follow.
Lab-grown diamond prices
Victoria asks Rob to chart when we started to see the prices of lab-grown diamonds fall. Rob notes that it has been a steady decline, and an expected one, though it may still be shocking to see now that it’s a reality. He remembers checking the price of a high-end lab-grown diamond and then seeing it thousands of dollars lower just three days later. The market is flooded right now. People say current prices are bottoming out and lab-grown diamonds will no longer profitable to produce if the prices get lower. However, further price decreases could still happen, if people dump their goods as they exit the business.
Quality variances among lab-grown diamonds
Victoria has been writing JCK Special Report newsletter articles on lab-grown diamonds. She watched a great presentation on quality in lab-grown diamonds, which was led by the co-founders of Ada Diamonds, a direct-to-consumer lab-grown diamond brand—and she learned a lot. The speakers explained that they started noticing a bigger distinction in the quality of lab-grown diamonds in 2019. They showed examples of lab-grown diamonds that all had—in theory—the same color and clarity grades but had very obvious differences. They explained the quality characteristics and issues in terms that were easy for laypeople to understand.
The overall message is, as this market has grown, and as people rushed to fill demand—which skyrocketed during the pandemic—growers prioritized speed to market. And when you cut corners in the growing process in order to get goods out the door, quality issues show up in the diamonds. Victoria’s article “Why Not All Lab-Grown Diamonds Are Created Equal” goes into more detail about the presentation and her takeaways.
Rob’s reaction is that this is a sign of the maturation of the lab-grown market. The discussion around lab-grown diamonds has long focused on whether they are the same as natural diamonds. While Rob agrees that they are diamonds, they are a different product, with a different market and different characteristics—which doesn’t make them less than regular diamonds, just different. The trend is to offer less information in lab-grown reports, which makes them cheaper, since if a report costs more than the diamond being sold, it’s not worth getting. Rob believes consumers deserve to have more information about what they are buying, especially when it comes to color tinges that you can see with the naked eye.
Victoria notes that Ritani sold a $99,000 26 ct. lab-grown diamond online. It’s fascinating that there’s still high demand for these diamonds. Getting to a larger size is much easier with lab-grown diamonds, and it is more accessible now than it used to be. The person Victoria interviewed at Ritani predicted it will be much more common to see big diamond jewelry flashing at the grocery store. And it won’t shock anyone anymore! It’s interesting to ponder what that will mean for the natural diamond industry.
Bank troubles and their impact on the jewelry industry
There were concerns about First Republic Bank after the failures of Silicon Valley Bank and Signature Bank. But has there been any impact on the jewelry industry? Every time a bank fails, the price of gold seems to get higher. It’s concerning for the industry, in terms of the overall economic picture. The irony is that so many diamond banks or diamond divisions of banks have already closed but didn’t get the same helping hand that the tech sector did. Victoria and Rob make a note to revisit the topic.
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