In a wide-ranging interview, the London Diamond Bourse’s new President, David Troostwyk, gave his views on everything from lab grown diamonds, the impact of G7 sanctions and how he and the bourse’s leadership aim to put the exchange at the center of the UK diamond industry’s activities. All this at a time when the industry worldwide is facing many challenges.
In an interview with Jewellery Outlook, Troostwyk spoke about the issues facing the UK - and global diamond industry.
LGDs and their place in the market
On the issue of LGDs, Troostwyk said that while they have undoubtedly taken some market share from the natural diamond market, especially in the bridal sector, he believes that they “are on a journey to find their ‘place’”.
Through the use of strong marketing campaigns, jewelers were happy to stock LGDs due to a competitive market and the high margins that were available. This worked out well for them, especially when consumers thought they were getting a great deal. He believes that the LGD market has now reached its peak in profit margin.
He praised the work of the Natural Diamond Council (NDC) and legislation regarding the marketing of LGDs. Recently, the NDC filed a complaint with the UK’s Advertising Standards Agency (ASA) over the SkyDiamond firm using misleading terminology to promote their LGDs Product.
The ASA ruling agreed with the NDC and ordered SkyDiamond to ensure their marketing is clearer and “not to use the claim ‘real diamonds’ to describe synthetic diamonds.”
Troostwyk feels that LGD producers will focus on fashion/costume jewelry.
He does not think that LGDs will reduce demand for natural diamonds. He sees LGD's as showing the power and attraction of natural diamonds thus creating more demand for them.
Marketing of natural diamonds
On the issue of the marketing of natural diamonds, he believes that diamond producers, manufacturers, wholesalers, retailers and private jewelers should collaborate and share knowledge and education to ensure positive natural diamond information is spread.
This is important, he comments, because the public have outdated information about diamonds which needs to be updated.
“We all have a responsibility to support each other with this – to be singing from the same hymn sheet. Increasing the size of the natural diamond pie means more business for all in the long run.”
Russian diamonds entering the UK
Troostwyk pointed out that Russian rough accounts for less than 1% of UK rough imports.
“We are dependent on other countries, mainly India, to segregate any Russian mined diamonds when selling into G7 countries. It’s important for these manufacturers to ensure the integrity of their supply, and we need to be certain that they can stand behind any warranty they give on the origin of their goods.
“My own view, is that the system of warranties that is currently being used, much like the Kimberley Process, is really the best way forward. It’s less intrusive, meaning less costly, both in money and time, and it puts the onus back onto manufacturing companies to be transparent, rather than forcing individual traders to bear the weight of provenance.
“The government’s appetite for continually tightening sanctions feels misplaced. Most diamond companies are keenly interested in servicing their clients’ needs and are not interested in illegal activities. There will, of course, always be a minority of criminals that look to take advantage. This is true in any industry, but this is a minority and we should not all have to bear the burden. So overall, I don’t see Russian mined diamonds penetrating the UK jewelry supply chain.”
Priorities as LDB President
Troostwyk said the Bourse must stay relevant and thriving for future generations, and the new committee must “lay the foundations for a strong, sustainable future.”
“We are dedicated to leveraging the knowledge and experience of our current members, while attracting fresh energy with a younger generation of members. We’re achieving this by ensuring we are an outward-facing organization, breaking away from the traditional closed-door approach.”
The LDB has instituted a mentor program giving members the chance to spend time with a dedicated LDB mentor, who shares business activities, personal experiences, and industry insights.
“We are dedicated to supporting the career development of young professionals in the industry.”
The exchange is looking to boost revenue beyond its membership fees, and has also launched a London Diamond Bourse Community App.
Increasing demand for natural diamond jewelry in the UK
Troostwyk says one problem is that diamond companies are still run as they have been historically – secretively and behind closed doors due to concerns about their competition.
“Secrecy at this level creates barriers to entry, which only serve to work against businesses. Working closely together with colleagues and supporting each other will help in natural diamond promotion, education and security.
“It is in all of our interests to contribute and bolster our community, as the only way individuals can flourish, is if the industry flourishes as a whole.”
New LDB initiatives
There will be more frequent networking events and keynote speakers, as well as presentations that will include panel discussions and webinars.
They will also take place online to ensure all members, regardless of where they are located, can take part and feel included in the community, he added.
Philip Carter for Rough&Polished
