2015 was a year that most members of the jewellery industry are happy to bid a good riddance. Weak sales at all levels of the industry made it difficult for many businesses. There were plenty of surprises, both good and bad, a few scandals, and the erosion of the diamond supply chain. Here are a few highlights from this past year.
GIA hits a bumpy road
On the tails of the EGL International grading crisis of 2014 came two events that shook the normally stable foundations of GIA. The first was an undisclosed treatment that slipped past the lab resulting in a recall of nearly 500 grading reports. This tarnished the lab’s reputation of its ability to detect altered stones. The second event was the hacking of their computer systems with grades changed on over 1000 reports; casting doubt on the security and accuracy of GIA’s databases. To their credit GIA was very open and honest about these problems, issuing trade alerts to inform the industry of the events.
DeBeers shows weakness
DeBeers crumbling hold on the diamond market became more evident this year. In sight after sight, sales were lower, production was cut, and more parcels were refused or deferred. In a rare move, they slashed rough prices by nearly 10% in August. But that did not help much. By October more than half of their offering went unsold causing them to undercut most of their customers by offering deep discounts to a select few in a last ditch effort to move inventory and raise capital. Even the reprise of the
“A diamond is forever” and other attempts at generic marketing failed to convert excess retail and wholesale inventory into sales. DeBeers is divesting itself of mining assets by selling its interest in the Kimberly Mine and closing the Snap Lake (Canada) and the Damtshaa (Botswana) mines.
The Apple Watch opens the doors for a new wave of smart watches
The much heralded release of the Apple watch was a smashing success for Apple. It also ushered in a new era of smart watches. Led by Tag Heuer, the Swiss watch industry is breaking ground on a variety of high end smart watches combining new technology with classic Swiss style and quality.
Auction Mania
Jewellery and gem auctions continue to set record prices. Sotheby’s Magnificent Jewels and Noble Jewels auction in May took place in Geneva with record total sales of $160,914,902. At that event, a Cartier 25.59 ct Mogok Burmese ruby and diamond ring hit a record price of $30,335,698, or $1,185,451 per carat.
A 10.33 ct Kashmir sapphire sold for a record per carat price of $240,381 at Christie’s June auction in Hong Kong and a 35.09 ct Kashmir sapphire ring at Christie’s Geneva auction in May hit a record total price $7,357,999.
Pearls hit new highs with $5,093,000 for a single strand natural pearl and diamond necklace at Sotheby’s Geneva in May and $5,093,000 for a four-strand natural coloured pearl necklace at Christie’s New York in April. But the real stars of the auction circuit were a 12.03-carat fancy vivid blue diamond graded as internally flawless, sold for $48.5 million at Sotheby’s Geneva in November. It was bought by Hong Kong billionaire Joseph Lau for his 7 year old daughter and renamed “The Blue Moon of Josephine,” along with a 16.08-carat vivid pink diamond, renamed “Sweet Josephine” for $28.5 million.
Next week I look into my crystal ball to see what’s ahead for 2016. Have a Happy, Healthy and Prosperous New Year