Israel

Sentiment was strong in the Israel diamond sector as 2017 came to an end. Traders felt they had seen a good year for business, while efforts by bourse leaders to develop the local industry seemed to be boosting morale. This positivity was especially the case for companies working with larger diamonds. These categories enjoyed a significant recovery during 2017, with the RapNet Diamond Index (RAPI™) for 3-carat stones rising 3.1% for the year.
   “It was a great year — one of the best years ever,” said Nissim Zuaretz, CEO and founder of D.N. Diamonds, which specializes in stones weighing 3 carats and higher. “Big stones were very good and very healthy.” High-quality goods were especially in demand as “people started to believe in diamonds again,” Zuaretz noted.

Strong demand for high-end goods
This holiday season was “better than the last three or four seasons,” added Avraham Eshed, founder of big-stone trading firm Eshed Diam — Gemstar. The last two months of the year were especially strong for the larger sizes due to a shortage of high-end goods, he explained.
   Competition for rough at auctions is also vigorous, making it challenging for manufacturers to get their hands on the stones they wish to process into polished.
“We try to [compete] in rough auctions, [but] it’s very hard to buy, because there are too many envelopes in each auction,” he said, referring to the large number of people who submit bids for each lot.
   Holiday sales started relatively late, but turned out to be robust, according to Orit Samet, CEO of EZ Diamonds. However, despite an improvement in trading, it is hard to make a profit, she noted.
   “If you could provide last-minute orders, you had very good activity in the last two months,” Samet explained. “Overall, 2017 was more stable than 2016 for 0.30 [carats] and down. For the Israel diamond trade, I think there isn’t enough room to distribute profit along the way. This is why Israel, as a distribution center, is starting to shrink more and more.”

A busy year for the bourse

Last year was an important and eventful one for the Israel Diamond Exchange (IDE). Yoram Dvash started a second term as president, after running uncontested. Signet Jewelers snapped up the parent company of online retailer James Allen, perhaps Israel’s most successful diamond start-up, for $328 million. The bourse opened a new innovation hub to help fledgling companies grow, as well as an online-sales room inside the exchange to help less tech-savvy traders find buyers on the web. And Israel’s parliament passed a new law under which the diamond trade will pay tax based on profits rather than revenue.
   One of the most significant changes in 2017 came in the rough trade, with the bourse opening the International Tender Center in February. Gem Diamonds, which previously sold all its rough in Antwerp, was among the miners that made their Israel debuts at the new facility. The IDE hopes the center will bring further rough-diamond activity to Israel and enable the country to flourish in its niche — the manufacturing of larger diamonds.

Article from the Rapaport Magazine - January 2018. To subscribe click here.