Diamonds Update

Why are the uncut diamonds sold on the Crater of Diamonds State Park website so cheap? If they're real diamonds, shouldn't they be worth more?

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Denny's Response:

There are many factors that impact the value or price of diamond.

1) About half of a rough diamond is lost in the cutting process so a 2.28-carat rough diamond might end up being closer to a carat when it is cut. The more irregular the rough shape, the more waste there will be in the cutting process.

2) There is an expense to cut and polish a diamond, which adds to its price. Likewise, there is a cost to get the diamond graded by the GIA grading laboratory, plus the shipping and insurance to make all those things happen.

3) The color and clarity of diamonds has a big impact on the value. Most of the diamonds found at any diamond mine, including Crater of Diamonds State Park, are not gem quality in terms of the color and clarity. Remember, most diamonds that are mined are used for industrial purposes like saw blades, drill bits, and abrasives, which are priced at a fraction of gem quality. Even low quality gem diamonds are a fraction of engagement ring quality diamonds.

4) The diamonds on the website are very small diamonds. Remember that "a point" is 1/100 of a carat so a 7-point diamond is 0.07-carats. The price of small diamonds is much less than larger diamonds because they are more plentiful. For example, a 1.0-carat diamond is about four times the price of a 0.5-carat, and a 0.5-carat is probably four times the price of a 0.25-carat. Once again, remember that those weights are the rough weights of the diamond before cutting.

5) The prices of the diamonds from Crater of Diamonds are probably more expensive than similar diamonds (weight, color, clarity) from other mines. At least I would expect the personal time and effort required in finding them and the uniqueness of an Arkansas diamond would make them more expensive.