As Leviev‘s Exports Drop 42%, Exporters’ List Underscores Israel’s Woes (Updated)

The top Israeli exporters export far less then they did before, falling from $3 billion in 2007 to $1.6 billion in 2009

It was not easy putting together a list of Israel’s top diamond exporters in 2009. The Diamond Controller’s office made many calls to diamond firms to get their approval for inclusion on the list, often to be turned down. Traders frequently did not want to expose the size of their decline in a year that will be remembered as one of the harshest for the Israeli diamond trade.

Topping the list again is Lev Leviev’s LLD Diamonds. Despite a 42.2 percent drop in exports, LLD shipped out $241 million in 2009. This was LLD’s fourth consecutive year atop the list, although exports have been declining, sliding continuously from $601 million in 2005.

Leo Schachter Diamonds exported $215 million worth of goods in 2009, declining 38.9 percent compared to 2008. A. Dalumi Diamonds saw exports decline 24.2 percent to $138 million.

The story, however, does not lie in the lines of data, but rather in between them. The top 25 listed companies have collectively exported $1.58 billion compared to $2.58 billion exported by the top-listed exporters in 2008. In 2007, the total stood at $3.01 billion. 

The Israeli industry is hurting. With shrinking polishing operations, less-than-generous banking support and limited arrival of rough to the market, it seems that the once prospering diamond center is past its heydays.

But hope is not lost. The Israeli economy is stable and rising quickly from the 2008 downturn. Many traders identified early on that the U.S. market will provide little growth in the coming years and, therefore, headed East. While half of Israel’s polished diamond exports are to the U.S., goods are changing hands less frequently inside the Israel Diamond Exchange and are shipped to Hong Kong, China and India.

The Israeli banks are offering tough love. While Israelis can only dream of the easy financing their colleagues in India enjoy, the conservative policies of the Israeli banks, including tight credit and financing against sales rather than exports, proved prudent in light of the recent economic upheaval.

Now Israel needs to find its new place in the pipeline. Antwerp faced a similar fate when it lost much of its manufacturing to Israeli operations. It guarded its status as a rough trading center, providing it with many more decades of vibrant livelihood. With New York positioned as a distribution center to retailers, while India and China are the leading manufacturing centers, Israel has the ability to become the loose polished diamond center and continue to be a leading developer of hi-tech tools and know-how as well.

Following are the top listed Israeli diamond exporters, with information about their exports in previous years, where available:

(Updated January 31, 2010 11:12 am, adding YEI's exports in the period prior to splitting YEI into two companies operating under the YEI umbrella)