Israeli Diamond Industry To Have Record Presence at Hong Kong March

Ramat Gan, Israel, February 18, 2009: The Israeli diamond industry will have a larger presence than ever before at the Hong Kong International Jewellery Show from March 4 - 8, 2009. This year, 61 Israeli diamond manufacturers and exporters will be exhibiting, with 41 of these companies located in the Israel Diamond Pavilion, organized by the Israel Diamond Institute Group of Companies (IDI).

IDI sources say that the unprecedented participation of Israeli companies attests to the overwhelming interest that the Israeli Diamond Industry has in expanding its business in Asian markets.

The Israel Diamond Pavilion is located in Hall 5, Aisles D,E,F,G and Annex. IDI’s information booth is located at 5F21 at the entrance to the pavilion. It will provide assistance to buyers and help them find the goods they require in the pavilion.

In honor of the fact that this is largest Israeli Diamond delegation to the HK March Show - IDI will be holding a festive cocktail reception in Hall 5 in the Oasis area, opposite the diamond pavilion on Friday March 6, between 2 – 3 pm.

An online mini-site, which can be accessed through the IDI portal site at http://www.israelidiamond.co.il/Exhibition/index.aspx?id=8&lang=eng
enables buyers to visit the pavilion virtually before the fair. The mini-site includes contact details of all Israeli exhibitors, as well as a map indicating their location at the show.

Most of the Israeli companies participating are refocusing their marketing efforts, offering different and lower priced goods than before. Elona Bilet, Marketing Director of Trapz says that the company will offer smaller pairs – called the Mini Trapz Collection -- which she says “offers the same unique look of trapezoid side stones but smaller and at a much more affordable price.” She added that Trapz will also be focusing on lines of radiants, cushions and emerald cuts in smaller sizes for eternity bands, bracelets and necklaces. “We expect these to sell well. We assume customers are looking for alternatives to larger stones and will be looking for multiple stone layouts that have the same big look but at a much cheaper price.”

Isaac Badra, Sales Manager of veteran fancy shape manufacturer, Vulcan & Co., which is a first time participant in the show, says that due to the economic situation they are offering the same goods at lower prices. “The price list and the market have both dictated that diamond prices are down. We have to adapt ourselves to the market,” he said.

The Israeli participants also have lowered expectations for the show but are cautiously optimistic. Bilet says that they have set up appointments with existing clients but hope to meet new buyers from Asia and Australia. Eran Ben Yehuda, Marketing Manager of fancy manufacturer Dani Avlas Diamonds, says they hope at least to cover their expenses. “We’ve informed all of our regular clients in Asia, as well as in Europe and the U.S. that we’ll be at the show. We hope to see them and to meet new clients – especially from new markets,” he said. Badra says that he has spoken to clients and they will be at the show. “We know they’ll come to see us but we don’t know how much they’ll buy. I don’t have any expectations, but I’m optimistic and hoping for the best,” he said.

IDI Chairman Moti Ganz said that now more than ever, Hong Kong, as the gateway to the Far East, is a major focus for the Israeli Diamond Industry. “For years we have looked to the Far East as a huge growth market for Israeli diamonds. Our industry, which is known for its flexibility and adaptability, is seeking now especially to expand its efforts in these markets. IDI is working hand in hand with the industry to promote these efforts,” he said.

IDI Managing Director Eli Avidar stressed that the Far East, with Hong Kong leading the way, represents a growth market for Israeli diamond exports now and in the future. “Although the world economic crisis is affecting the Far East, we are looking forward to seeing some encouraging signs at the Hong Kong show in March,” he said.

Avidar added that he was very optimistic about the medium and long term prospects for Asian markets. “China has evolved into an independent market for luxury goods and jewelry, with a great amount of wealth being created. In the coming years we believe that China will become an important consumer of polished diamonds, and we are focusing our marketing strategy on developing this market,” he said.

According to Avidar, IDI’s representative office in Hong Kong was spearheading efforts to enhance trade contacts with the region. In addition, he noted that IDI’s Chinese-language portal site has become an important vehicle for facilitating direct contacts between these countries.

Hindustan Zinc hikes silver rates to Rs 21,200/kg

Vedanta Resources group firm Hindustan Zinc today said it has increased prices of silver by Rs 450 to Rs 21,200 a kilo gram.

Silver metal is used in electrical contacts and conductors, mirrors and in catalysts for chemical reactions. Its amalgamations are used in dental fillings. It is also used in soldering activities.

The price revision is effective from today, a company circular said, adding, the prices are exclusive of sales tax/VAT and other statutory levies as applicable.

The miner revises silver rates on a daily basis following the price movement at the London Metal Exchange.

Shares of Hindustan Zinc were trading at Rs 334.90 on theBombay Stock Exchange, down 1.46 per cent in the early afternoon session.

Ganjam Opens Exclusive Boutique In New Delhi

Ganjam the premium jewellery brand has a century old legacy of being jewellers to The Indian Royalty. Now this internationally acclaimed brand has opened its first exclusive boutique in New Delhi at the DLF Emporio ushering in an era of design and unparalleled craftsmanship, in the nation’s capital.

To celebrate this opening Ganjam will exhibit highlights of their acclaimed family Collection of Heritage jewellery. Steeped in history and rooted in Indian tradition, this rare collection will be on display from 7th February to the 15th February 2009 at the newly opened jewellery boutique. On display will be antique ceremonial pieces worn by Indian royalty and courtiers. With the same inspiration as the South Indian temple architecture, these ceremonial pieces are strongly influenced by mythology and the human form.

Ganjam is recognised internationally as a cultural reference to the Indian jewellery market and has to its credit numerous accolades, trophies and commissions from the world's leading jewellery specialists like the Platinum Guild International (PGI), World Gold Council, Pearles de Tahiti.

Ganjam was one of the select brands invited to exhibit at the prestigious International Jewellery Fair in Basel and was also commissioned by the PGI to design and create the iconic piece for the Basel Fair, 2007.

Luxurious indulgence has long been a term synonymous with Ganjam as they merge contemporary designs with traditional forms of craftsmanship, bringing to the customer a unique blend of luxury, style and glamour.

According to Mr. Umesh Ganjam, Director Ganjam “At Ganjam, we are extremely proud that while maintaining our legacy of craftsmanship we have received international appreciation and won global awards for our designs.”

While commenting on their foray into the Delhi markets, he said, “Ganjam’s excitement on entering the Delhi market is palpable, as we believe it to be a receptive market to our quality of jewellery, which has not until now been generally available. Customers in the Capital have a strong awareness of the latest international fashion trends and a deep appreciation for Indian heritage. They are connoisseurs of art and lovers of all good things in life. We believe that Ganjam will appeal to this niche audience and be well accepted by them”

This 1500 sq. ft store is designed to express the jeweller’s identity through subtle glimpses of the Hampi architecture which is visible in the regal interiors.

A long-term cost perspective on PGM prices

Current PGM demand has made many projects unfeasible. But the fall in demand could also obliterate the deficit which has plagued the market over the past few years as well as push the market into a surplus until at least 2014. We expect demand to fall by almost 8% y/y, to 7,22m oz in 2009. Thereafter, we expect a y/y increases for platinum demand. The fall in demand is driven by car sales which could decline by 7m units from levels reached in 2008 as consumers in the US and Eurozone struggle to cope with economic conditions. We expect little support from jewellery demand which we expect to remain largely unchanged. Other industrial uses are also set to decline. In 2010, we expect a recovery in demand. While y/y growth rates could rise, the amount of platinum oz actually consumed would only reach the levels seen last year in 2011. By 2014, we estimate that total demand for platinum could reach 9.125m oz.

Platinum mine supply in 2008 is estimated at 6.7m oz. While we have already seen production cuts at platinum mines in South Africa, we doubt production cuts could completely offset the fall in demand in 2009. At current price levels, we expect production cuts of between 400K and 500K oz. Working with the low end of the range and adding 190K oz of new platinum supply coming to market, total supply should be 7.51m oz in 2009.

Furthermore, in H2:10, as demand starts to pick up, operations which were shut down this year could restart (we estimate 400K), allowing for supplyto come to the market faster than any new developments. We have assumed that the cutbacks are brought to market in equal proportions in 2010 and 2011. Another source of supply is scrap. While this is not set for a massive rise until 2011, scrap and recycled platinum could reach 1.8m oz by 2014. This, we believe, could see the platinum market in a constant surplus until 2014. Should recycled metal increase as mentioned, and demand is close to our assumed numbers, the surplus would rise rapidly as we approach 2014. Above-ground stock would rise as a result. Should this happen, it should restrain prices.

We use our PGM cost model to estimate a price for platinum, palladium and rhodium that is consistent with our estimate of a surplus of 300K oz of platinum in 2009, and the surpluses in following years. In our cost model, we assume mining inflation at 10% y/y until 2014 and ZAR/ USD at $10 in real terms. While cost inflation is low compared to mining inflation in the recent past, current deflationary forces should push some mining costs lower. We further assume that new projects would, in 2008 prices, not be more expensive than current operations. This assumption is justified on the premise that any mine more expensive than current mines would not be a viable operation, given the expected surplus in the market.

There is a caveat to our approach. Above-ground stock ofplatinum could rise by another 3.2m oz by 2014, from the current estimate of about 1m oz. As a result, the market could see this as excessive, and prices might fall. Above-ground stock of 4.2m oz would translate into a 160 days of consumption (at our 2014 demand levels) and this is much higher than the current estimate of 40 days. Arguably, some of the projects listed would not come to market, or at a much smaller scale.