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RAPAPORT… Ramat Gan means something to everyone in Antwerp — be it as a supply/demand market or as a competing center. When talking about Israel from an Antwerp perspective, however, there seems to be a consensus regarding two important aspects.
The first is the general impression that there are fewer companies active in the Israeli diamond business. That doesn’t mean that the size of the market has been decreasing, just that the turnover is now concentrated in fewer hands.
Secondly, the typical Israeli goods are now manufactured in India. The obvious reason is the impossibility of competing with India’s lower labor costs. The traditional rough for 3- to 4-grainers and 5- to 10-grainers is now very difficult to find in Israel. The fewer manufacturers that are left are reported to be focusing more on 10-caraters up. Another factor that might be aggravating the difficulty for Israelis, except for some big offices: De Beers preference in supplying 3- to 10-grainers rough to Indian manufacturers, as they agree to take and polish stones that are difficult to move. They take the less desirable goods, but they also want the cream.
Eager for Business
Shashin Choksi of Swati Gems, said: “I really admire the young Israelis who establish themselves in Antwerp and radiate from there through the whole of Europe. No matter what the state of the market, to them, there are always opportunities. Besides, they are more aggressive and far more efficient than many small and medium Antwerp-based companies or offices. They gather at 8 a.m. in the Empire Centre and discuss the market situation, exchanging information to help each other and others who help them, too. I have the profound impression that by losing faith in themselves, Antwerp’s former generation didn’t encourage their heirs to join them.”
Avi Pinchasi of Pinchasi & Sons agreed that “These young people are extraordinary. They’re aggressive in the right sense of the word.” Roby Taché of Taché Diamonds confirmed, “Tel Aviv has become a strong diamond transit center, thanks to the entrepreneurship and dynamism of the Israelis, which gives them a definite edge over Antwerp.”
“The Israeli companies’ strength is that they managed to create better marketing and channeling of their goods outside their market,” said Gon Raz of Windiam. “They have an edge, whereas Belgians are more shy and conservative in their approach.”
Financial analysts concur that there is a general impression that Israeli companies are proportionately less strong financially than Antwerp-based ones. Raz agreed that “There’s more money in Belgium and much more inventory available.” Usually, during bull market periods, Israeli manufacturers are apparently pushing prices higher — Rapaport minus 10 percent for a 2-carater — while during the weaker, bear markets, they tend to break the market prices by giving away 40 to 50 percent of the Rapaport value. The prices of a similar stone in Antwerp would oscillate between Rap minus 20 and Rap minus 30 percent.
Antwerp’s Advantages
Politically, it’s no secret that since the second Intifada, fewer people are willing to fly to Israel. Moreover, Belgium has a big advantage over Israel in being in the middle of Europe. Europe is not the biggest market, but it’s still a serious market — Italy, Spain and the U.K. are big consumer markets. Antwerp is convenient to all of them — a flight of about one hour and no customs or VAT (value-added tax) issues.
The Israelis have reacted by “traveling to Europe and all over the place with the goods and selling on location. Doing so has turned Israel into international brokers,” said Raz. Philip Claes, Diamond High Council (HRD) spokesperson, added that “Whatever happens, Israel is a real trade partner. The cake is big enough for us all to be able to share a piece.”
HRD News
At the same time as the new name of the HRD was being approved — Antwerp World Diamond Centre — Theo Dilissen, currently chief executive officer (CEO) at Aviapartner, was appointed as independent director of the center. Dilissen will be assisted by six people chosen directly from the diamond trade, three representatives from diamond exchange markets, one member from the industry itself and one delegate from employee organizations. As part of the restructuring, which is expected to be completed in early 2007, the Antwerp World Diamond Centre name also will apply to the foundation. “Through this name, Antwerp World Diamond Centre seeks to acquire a clearer profile in the diamond trade and especially the world outside, putting the emphasis on Antwerp as a world diamond center,” said Freddy Hanard, managing director of the center.
The Marketplace
• J and SI2 down are in demand almost across the board, low-budget stones are moving well and Rapaport’s recent price adaptation is considered not strong enough.
• Piqué 1, 2 and 3 and darker colors are still 35 percent too low for some goods.
• Darker colors K-M, in VS mainly, were selling in Hong Kong like hotcakes. D-F/ VVS can be found at high prices, but no darker is available, so prices of some darker outweigh that of better color ones.
