Martin Rapaport is a chairman of the Rapaport Group, founder of the Rapaport Diamond Report and the RapNet online diamond trading network.
Rapaport has been called a "maverick" within the diamond industry[1] for standardizing and publishing diamond prices.
Rapoport was an early proponent of the Kimberley Process aimed at limiting the number of "conflict diamonds" in worldwide circulation.[2]
Martin Rapaport began his work in diamonds as a cleaver and rough sorter in Antwerp, Belgium. He began brokering rough and polished diamonds in New York City in 1975.[3] In 1978, he created the Rapaport Price List.[4] He has since created a number of businesses that bear his name, including the electronic trading network RapNet in 1980 and several diamond-related news sources in print and web formats.
He is a member of several non-profit and diamond-industry-related organizations, including the Jewelers for Children Charity Fund, the Diamond Manufacturers and Importers Association of America[5] and the Jewellers Vigilance Committee.
Following visits to Sierra Leone in the early 2000s, Rapaport advocated more for a Kimberley Process and launched Rapaport Fair Trade.
Rapaport is a controversial figure in the diamond industry for publishing the Rapaport Diamond Report in the late 1970s, which has become the de facto pricing baseline for wholesale polished diamonds.[6] His proponents and critics claim this guide is the lead to a lessening of the cost of diamonds during the commodities boom of the 1970's.[7]
Rapaport's impact within the industry is considered controversial by critics, as his commercial price guides have been considered a step toward commoditizing diamonds. [citation needed]
Critics also claim Rapaport has made influential statements [citation needed] on issues such as conflict diamonds, synthetic diamonds, diamond treatments and Fair-Trade diamond issues, or has often been an unlikely ally to NGOs.[8]
The Rapaport Diamond Corporation has also been criticized for publishing wholesale price guides for diamonds whilst allegedly simultaneously trading in diamonds directly to consumers.[9]
Rapaport publishes reports, research and analyses covering a range of topics related to the diamond industry with a strong focus on transparency, ethical sourcing, and market integrity. [10][11][12][13]
Rapaport originally tried in 1982 by filing out a contract proposal to the New York Mercantile Exchange to create a diamond commodity market.[citation needed] The effort failed, he claimed, because "...the diamond industry didn't want price transparency."[8]
Neil D. Reiff claimed Rapaport is "destroying" the diamond industry by trying to commoditize diamonds and his price guide no longer reflects the wholesale value of diamonds as they are sold, but influences what those prices are before they go to market. Rapaport counters that diamonds are not unique, as De Beers marketing claims, and are subject to the same laws of supply and demand.[14]
A New York Times report in 2012 cited Rapaport among a list of other major industry players, who are countering the argument that diamonds have too many characteristic differences to be traded in a standardized commodity market.[15]
Rapaport has been an outspoken critic of De Beers, and what he believes is an effort to manipulate diamond prices.[16][17]
Rapaport has spoken at length about perceiving diamonds as an investment. In 2008 while speaking to The Guardian, he cited diamonds' durability because, "...there is so much new wealth around the globe and wives want in on the action - and if they can't get their hands on big stones, then the price will only go up."[18][19]
Rapaport argues that diamonds are commodity, against detractors who claim each stone has to be evaluated individually based on a list of different factors.[20]
Rapaport submitted papers in 2002 and in 2005 criticizing the European Commission's handling of investigations of collusion between De Beers and Russia's state owned diamond cartel, ALROSA. He alleged the European body ignored evidence that ALROSA was selling diamonds to De Beers at prices 8 to 20 percent below market value and was aiding and abetting unethical and illegal business practices.[citation needed]
Rapaport has criticised the creation and sale of synthetic diamonds in comparison to mined diamonds. While he does not believe they will be as valuable as diamonds mined from the earth,[21] he believes that synthetics are yet another commodity that jewellers can sell for whatever value the marketplace deems they are worth, but that consumers would desire a disclosure that a diamond they are buying is either lab grown or mined.[22]
Rapaport travelled extensively to Sierra Leone to investigate the diamond market.[23] After returning, he wrote and published "Guilt Trip"[24] which was quoted in the United States Congressional Record:
"Hundreds of millions of dollars of Sierra Leone diamonds are being traded on the world markets without any benefit going to the government or people of Sierra Leone. The real problem facing Sierra Leone is not merely how to share diamond resources among warring factions, but how to stop the illegal diamond industry from stealing the country's resources. But it goes beyond that. The bastards are not just stealing Sierra Leone's diamonds, they are trading them for guns. Guns which are used to kill people to keep the war going... The real challenge facing Sierra Leone and the world diamond trade, is how to stop this horrific murderous cycle of illegal diamond activity."[25]
Rapaport is a key member of the Kimberley Process Plenary, the cooperative United Nations diamond industry partnership to self-regulate the end to conflict diamonds.[26]
Rapaport has been cited as a technical asset to the process by the South African government,[27] and has advocated the need for better price transparency as a means of keeping the industry honest.[28]
Rapaport is an advocate of finding an equitable solution to exploitation of West African labor, and has tried to build mining collectives in Sierra Leone and create a place in the market for what he calls "Fair Trade Diamonds" that would be certified as guilt and exploitation-free.[29]
Rapaport annually addresses ethical dilemmas within the industry at the Rapaport International Diamond Conference,[30] where he invites Non-Governmental organizations such as Global Witness and Amnesty International to meet with diamond industry leaders.[31]
Under a plan designed by Rapaport, diamond miners in West Africa will be invited to register to bring diamonds to a public auction. Rapaport says he will pay 5% more than the gems' market value. After independent monitors ensure that diggers are paid about a third of the purchase price, a "development diamond" label will be applied before gems are shipped to jewellers.[citation needed]
Rapaport, in cooperation with the U.S. Agency for International Development and Global Witness invested $60,000 of his own money to create four alluvial mining cooperatives in Sierra Leone, but ultimately sees "Fair-Trade" diamonds as the solutions to West Africa's woes.[32]
Critics have accused Rapaport's diamond prices as being too low,[33] having a flawed or arbitrary methodology[34][35] and accused Rapaport of having a monopoly on diamond grading with GIA.[36]
Groups such as the African People's Solidarity Committee, who protested at the 2007 Rapaport International Diamond Conference in New York, say that "all diamonds are blood diamonds"[37] and that Rapaport's efforts to help artisanal miners is nothing more than a public relations ploy:
The African People's Solidarity Committee rejects this public relations ploy. They are calling for nothing less than all of Africa's resources under the control of the African working class itself. Africa is the richest continent on earth. Africans don't need charity; they need control over their own land.[38]
Pricescope should not be mentioned as a references-They are biased
Correction regarding "Reference #7" and our article entitled The Rap Trap [1]. Our article is not "critical" of Martin Rapaport's Diamond Price Report, but rather of the manner in which some retail jewelers use the contents of the report to mislead consumers.
Media related to Martin Rapaport at Wikimedia Commons