Diamonds Update

New River Gorge Learning Co-Op

When my daughter calls and says she could use some help on a project, I pay attention and ask how can I help. She wrote the following article as part of a contest to try to raise funds for a school that she really believes in.  If you follow the link at the bottom of the article below, you can cast your vote for this project to improve the factilities for a school in West Virginia that needs some help. 

Here is the text of the article by Angela Pugh:

The New River Gorge Learning Co-Op is nestled in the rural mountains of south central West Virginia with limited academic options. Public schools in Fayette County have been “failing” for many years and were taken over by the state two years ago. In 2010, several industrious mothers decided to create a school that would meet the needs of the area children better, and created a Montessori-based learning center. Their goals were to include a solid core curriculum and instill a love of learning in each child. They found a building surrounded by 70 acres of grassy and forested land, with a creek, hiking paths, and constructed a natural playground.
The children in the Primary Program, ages 3-6 years old, practice practical life skills, socialization, and develop a solid foundation for reading, writing, math, and other pursuits. The Early Elementary Program for students 6-9 years includes a combination of guided learning and room for individual pursuits from mathematics to physical fitness. While our outdoor surroundings are optimal for learning, our classrooms are inadequate (small, old, and drafty). We would use the proceeds of the contest to place a down payment on much needed new classrooms. Please vote for us!

Please vote for this project by clicking this link and casting your vote.

GIA Versus EGL Diamond Grading Differences

Whenever we have a client say they found a diamond priced much less somewhere else, the first question we ask is if they are comparing similar quality and GIA graded diamonds.  We try to point out to clients that EGL, IGI, HRD and other grading reports tend to be off 1 to 3 color grades and often a clarity grade compared to GIA grading.  I wrote a blog article about this several years ago at http://diamonds.blogs.com/diamonds_update/2008/09/learn-to-play-the-certification-game.html and we encounter these types of discrepancies everyday between the grading reports.

However, some clients just do not want to believe the truth and hope they will somehow find a diamond priced for 25% to 50% less than its actual value.  We have even had clients argue with us saying that they have found online opinions that the EGL and GIA grading is the same.  We can only say that our experience has been that every diamond we have seen that was graded by both laboratories has come back with the EGL grading significantly higher ratings.

We recently had a client who requested a search for a round diamond about 1.4-carat weight with at least G color and VVS2 clarity.  After providing him several lists of recommendations for GIA graded diamonds meeting his requirements, he asked if we had any non-certified diamonds that we would recommend.  We explained that we usually only recommend GIA graded diamonds and explained about the inaccurate grading that is common with other laboratories and referenced the blog article mentioned above.  A month later, he emailed saying he had purchased a diamond from another retailer and was sending it to the GIA Laboratory in Carlsbad, CA.  He said he was able to find a higher quality stone at a lower price than we had recommended to him.

Here are the specifications for the diamond he purchased:

Round, 1.50 carat, EGL-Intl cert, H color, VS2 clarity, depth 60.4%, table 57%, measurements 7.38 x 7.33 x 4.44 mm, Excellent polish, Excellent symmetry, Premium EGL cut grade, Slightly Thick girdle, Slight Blue fluorescence

I never did understand why he thought H VS2 was higher quality than the G VVS2 he required for our recommendations.

Here are the specifications for the same diamond when graded by the GIA:

Round, 1.50 carat, GIA cert, K color, SI1 clarity, depth 60.3%, table 58%, measurements 7.39 x 7.34 x 4.44 mm, Very Good polish, Fair symmetry, Good GIA cut grade, Very Thin to Thick girdle, Strong Blue fluorescence

In other words, the same diamond graded by both laboratories came with very different grading even though the laboratories claim to use the same grading standards.

	EGL-International	GIA	Difference
Color	H	K	3 grades
Clarity	VS2	SI1	1 grade
Polish	Excellent	Very Good	1 grade
Symmetry	Excellent	Fair	3 grades
Girdle	Slightly Thick	Very Thin to Thick	3 grades
Cut Grade	Premium	Good	3 grades
Fluorescence	Slight Blue	Strong Blue	2 grades

The bottom line is that when you are making a significant investment, you should want to know what you are purchasing.  The GIA is the most accurate and consistent of the diamond grading laboratories so is the best way to ensure the quality of your diamond purchase.  With other grading laboratories, you do not know what you are getting as evidenced in the example above.

Diamond Prices Head Up Again

Retail diamond prices in the second half of 2008 experienced one of the largest decreases in decades and followed by relatively no price changes up or down in 2009.  However, rough diamond prices in 2009 were up by about 15% and they have increased that much already in 2010.  As a result, there is significant pressure on polished diamond prices to move upward.

With the U.S. economy beginning to recover and the U.S. consumers typically purchasing about half the world’s diamonds and diamond jewelry, retail prices are moving upward.  The economies of other diamond-consuming countries are also showing signs of recovery so the global demand for polished diamonds is expected to rise in 2010.

At the end of January 2010, there was an industry wide price increase for diamonds over 3.0 carat weight with price increases ranging from 1.5% to 3.5% depending on carat weight, color and clarity.  In mid-February, another industry wide price increase occurred for round diamonds in the 1.00 to 1.99 carat range with at least H color and VS2 clarity and had increases in the 1.0% to 5.0% range depending on carat weight, color, and clarity.

It is only a matter of time before we see price increases for fancy (everything but round) shaped diamonds under 3.0 carats and for round diamonds in the 2.0 to 2.99 carat weight range.

These early year increases will not be the last increases as projections are for polished diamond prices to rise by double-digits for 2010.  For diamond shoppers, this means that the best prices are going to be had now rather than later this year or in the foreseeable future.  Of course, the lesson we have learned in the past two years is that projections for global economies are anything but certain.

Diamond Market Update

We have many clients who want to buy a big diamond but have been waiting until the price bottom out due to the recession.  For months, I have been telling them this is the bottom and they can expect to see polished diamond prices moving up shortly.

I am not the only one with this belief.  Yesterday, Robert Gannicott, CEO of Harry Winston Diamonds noted that rough diamond prices have improved by at least 61% from the prices at the lowest part of the market, during the first quarter of this year.  Harry Winston owns part of the Diavik diamond mine in Canada’s Northwest Territories in addition to its high-end jewelry stores.  Even with the dramatic increase from the low, rough diamond prices in the quarter ended October 31 were about 9% lower than the same period in 2008 and 13% below the highs in the summer of 2008.

What is remarkable about the increase in rough diamond prices is that polish diamond prices have been flat for most of the year.  Most diamond mines closed for months at the start of 2009 and this allowed the excess rough and polished diamonds in the pipeline to be sold until demand was more aligned with supply.

The mines have been producing for months and the cutters are back in operation.  The demand for polished diamonds for the Far East and India is on the upswing and the US holiday season is in full swing.  In the months ahead, demand is expected to match and exceed supply, implying rough and polish prices will be moving up in the near term.

Vivid Pink Diamond Sells for $10.8 Million

Colored diamonds have been making headlines this year and that was the case again at the Christie’s Jewels: The Hong Kong Sale December 1.  A rare, 5-carat Fancy Vivid Pink cushion shaped diamond ring sold for $10.8 million, setting a new record for total price for a pink diamond sold at auction and a new record for price-per-carat at auction.

The pink cushion-cut diamond was set in a platinum and 18-karat rose gold mounting designed by famous jewelers Graff Diamonds with a pair of matched white shield-shaped diamonds.  The pink color is a rich bubblegum hue with even saturation, seldom seen in natural pink colored diamonds.  The pink diamond is also a rare type IIa diamond and the high price reflects not only its exceptional beauty, but also its extreme rarity.

Purchased by a private Asian buyer, the exceptional diamond sold for almost double its pre-auction estimated value.  The diamond was strategically auctioned in Hong Kong because China’s retail market is recovering faster than American and European markets.  The Asian market for high-end, big-ticket collectible goods is very aggressive due in part to the optimism of the financial markets in that area.

Crater of Diamonds State Park

Crater of Diamonds State Park near Murfreesboro, Arkansas continues to be the source of diamonds for the public who have a keen eye and are willing to do a little digging.  Every year, heavy machinery is used to uncover new material in the park’s 37 1/2 –acre diamond search area where park visitors can keep the diamonds they discover.  On average, over two diamonds a day are found by visitors to the park.

The last 12 months have been productive for diamond seekers and the following stories highlight some of those “shiny” discoveries.

Richard Burke and his wife, Carol, of Flint, Michigan had read about Crater of Diamonds State Park in a geology book and seen a feature about the park on The Travel Channel.  The couple had been visiting Colorado panning for gold and fossil hunting when they decided to make the two day drive to Arkansas to try their searching skills on diamonds.  On September 30, 2008, Richard was searching a shallow ravine when he discovered a 4.68-carat white diamond that looks like a frosted ice cube.  He named the diamond the “Sweet Caroline” after his wife Carol and their favorite song, Neil Diamond’s “Sweet Caroline.”

On November 16, 2008, Rhonda Bankston of Baton Rouge, Louisiana was camping at the park and had decided to try her hand at diamond searching.  She had seen a segment about Crater of Diamonds State Park on the Travel Channel’s “The Best Places to Find Cash and Treasures” and was intrigued enough to try it.  On her second day of searching, she found a 2.09-carat white diamond that she later had faceted to a 1.04-carat cushion cut shape.  Rhonda named her diamond “Dream Angel,” which is appropriate for a gem with exceptional white color and high clarity.  Crater of Diamonds had yielded many high quality diamonds and the most famous was the 3.03-carat Strawn-Wagner Diamond found in 1990 that was ultimately cut to a 1.09-carat D color, Flawless clarity, and Ideal cut diamond, which is the highest quality possible when it was graded by the American Gem Society Laboratory.

Glenn Worthington has visited Crater of Diamonds State Park for 30 years and has found many diamonds, written a book about the park, and produced a DVD demonstrating how to find diamonds at the park.  On April 9, 2009, Glenn was searching for diamonds by dumping buckets of mud over a screen.  He had decided to process one last bucket before the Easter weekend when he discovered his largest diamond.  The 2.04-carat diamond has a bright yellow color and has a smooth, lustrous surface and an elongated shape.  Glenn named his special find “Easter Sunrise” because of its appearance and the timing of his find.

On April 28, 2009, Mike Burns of Arab, Alabama, discovered a 5.75-carat white diamond.  Mike had traveled to Colorado with a good friend to look for gold but the property owner was not available where they wanted to search.  Prior to the trip, Mike’s wife, Linda, had mentioned she would like a diamond for their 20th anniversary and she repeated that comment on the phone when he called from Colorado.  She suggested he should get to Crater of Diamonds State Park so he could find a diamond for her.  Mike did go to the park and while walking along a wet creek bank spotted a shiny object.  After confirming his find was a white diamond, he named his gem “Arabian Knight” in recognition of his hometown high school football team.  Time will only tell if Linda gets her anniversary diamond.

On May 13, 2009, Stephen Carter of Hot Springs, Arkansas discovered a 2.35-carat white diamond.  As Stephen was leaving the search area at about 6:00 pm, he noticed the sparkling white stone sitting on top of a mound of dirt alongside the furrows in the field.  The angle of the sun and his Billy’s vigilant eyes resulted in the special find.  Stephen and his wife had been experiencing tough financial times.  They had watched TV news coverage of a woman who found a diamond at the Crater of Diamonds.  The Carters thought that finding a diamond might be the answer to their financial troubles so they prayed for several weeks and made the trip to Crater of Diamonds.  On their fifth trip to the park, Carters said “Our prayers were answered” and they appropriately named the diamond “Faith.”

On October 20, 2009, Royce Walker of Lockesburg, Arkansas was operating a bulldozer for a contractor trenching the Crater of Diamonds State Park search area.  As he walked across the search area to give his son, Bobby, a lunch break he spotted something shiny in the dirt.  He picked up what turned out to be a 2.93-carat, dark honey brown colored diamond about the size of a pinto bean.  The diamond is shiny on one side and metallic looking on the other side with a broken edge indicating it was probably part of a larger diamond crystal at one time.

On October 30, 2009, Billy Moore of Murfreesboro, Arkansas found a 3.20-carat white color diamond with a rounded shape.  Billy named the gem “The Frosty” because of its rounded, white appearance.  Billy is a frequent visitor at Crater of Diamonds State Park.  While he has found approximately 400 diamonds in the park during his years of searching but the 3.20-carat is by far his largest find.

Magnificent Colored Diamond Sale

Sotheby’s “Magnificent Jewels” sale in Geneva November 17 was a high dollar success for colored diamonds and other colored gemstones but the highlight of the show was a green diamond ring.
Only a few natural green diamonds have been auctioned in recent decades and most of those had bluish or yellowish secondary color, which pointed to the importance of the sale of a 2.52-carat Fancy Vivid green color Cushion Modified Brilliant Cut diamond.  The rare diamond was claw-set in a platinum mounting with yellow gold head.

The cushion modified brilliant cut diamond was graded Fancy Vivid Green color, VS1 clarity, depth 63.9%, table 58%, measurements 8.80 x 7.35 x 4.70 mm, ratio 1.20, Excellent polish, Very Good symmetry, Faint fluorescence, and was laser inscribed “GIA 2106213537.”  While not the highest priced item at the auction, the $3.08 million sale set a world-record for price per carat for a green diamond at auction.

Other colored diamonds sales made history too.  A 3.17-carat Fancy Intense blue diamond sold for $2.52 million and set a new world-record for price per carat for an Intense Blue diamond at auction.  The round brilliant cut diamond was set in a simple four-prong platinum mounting.  The natural Fancy Intense blue colored diamond has VVS2 clarity.

The Roxburghe Rubies, a necklace and earring set, sold for $5.77 million, five times the estimated price before the auction.  The necklace contains 24 cushion shaped rubies and 24 cushion-cut diamonds and the set dates back to the late 19th century.  The necklace was the property of Mary, Duchess of Roxburghe and is thought to have been purchased from Garrards by the 5th Earl of Rosebery, as recorded in one of his diary entries.  The necklace is accompanied by its original turquoise velvet fitted case, embellished with the monogram R under a coronet, by R&S Garrard & Co, Goldsmith and Jewellers to The Crown, as well as by the original hand-written documentation detailing the weights of the stones.

Jewelers Mutual Personal Jewelry Insurance

It happened again today.  A client called us asking for a replacement ring for the lost engagement diamond ring we had sold them.  Unfortunately, they had not protected themselves by getting insurance for their diamond ring.

Diamond Source of Virginia provides clients a free insurance appraisal with their diamond ring but it is the client’s responsibility to get the ring insured.  Many choose to get a scheduled property rider with their homeowners or renters insurance.  Another great option for jewelry insurance is through Jewelers Mutual Insurance Company.

Jewelers Mutual is the leading insurer to specialize in jewelry and jewelry business insurance and has a Personal Jewelry Insurance Program that provides comprehensive coverage for personal jewelry.  The personal jewelry insurance policy provides coverage against the following:

• Mysterious disappearance
• Loss
• Damage
• Theft

The annual policy premium is based on:

1. The retail replacement value of each jewelry item you insure
2. The state/county where the person who possesses the jewelry lives
3. The optional deductible you choose

If you need to insure your jewelry or just want to compare you current coverage and rates, get your free, no obligation quote and learn about coverage details, visit www.JewelersMutualinfo.com where you can enter A00108 as the unique Jeweler Code.

Marisa Miller in Victoria Secret’s $3 Million Diamond Bra

The showpiece of this year’s Victoria Secret’s annual Fashion Show will be the Harlequin Fantasy Bra, worn by supermodel Marisa Miller.  The bra, created by Italian jewelry house Damiani, contains 2,300 white, Champagne and Cognac colored diamonds with a 16 carat heart-shaped brown-yellow diamond pendant dangling in the front.  Taking over 800 hours to make and with 150 total carat weight of diamonds, the gold framework and hand-set diamonds are fashioned in a harlequin pattern.

Marisa Miller was on the cover of the 2008 Sports Illustrated Swimsuit Issue, is a model for Victoria’s Secret, and is an ambassador for the American Cancer Society.

The fashion show will be televised by CBS on Tuesday December 1 at 10:00 PM ET/PT.

Check out last year’s fantasy bra blog article:
http://diamonds.blogs.com/diamonds_update/2008/10/5-million-victorias-secret-diamond-bra.html

Big Diamonds Bring Big Dollars

While the tough economic times have affected the average diamond shopper, the extremely wealthy shoppers are on a buying spree.  At Christie’s jewelry action October 21 in New York, it was as if the recession never happened.

An anonymous buyer purchased a 32.01-carat D color, Internally Flawless, type IIa Asscher cut diamond ring for $7.7, which was almost double the $3 million to $5 million pre-auction estimated value.  At $240,000 per carat, the sale set a new world record for a colorless diamond.

The Annenberg Diamond’s previously owner was Leonore “Lee” Anneberg, who died in March at the age of 91.  She was the US Chief of protocol in the Reagan administration and was the wife of billionaire publisher Walter Annenberg, who died in 2002.

A 16.33-carat round diamond with E color and Flawless clarity was purchased for $1.6 million ($97,000 per carat) by a private Asian dealer.  Other items that sold for more than preliminary estimates included belle époque diamond and rock crystal bow brooch by Cartier (sold for $1.1 million, estimate $200,000 to $300,000) and a Harry Winston emerald and diamond necklace (sold for $950,500, estimate $500,000 to $700,000).

Other big dollar items sold at the auction included a pair of pear pendants with a 7.18-carat Fancy-Blue pear-shaped diamond and an 8.04-carat Fancy Light Pink colored pear-shaped diamond, which sold for $1,426,500.  A pair of earrings featuring D color, Internally Flawless pear-shaped diamonds (7.51 carats and 8.18 carats) sold for $1,202,500.

The Christie's auction (October 21 in New York) totaled $46.5 million.