GemNotes

MAXIXE BERYL: FADING BEAUTY IN COURT

A recent court ruling in Singapore could have far-reaching effect on legal cases involving disclosure of gem treatment. Judge G.P. Selvam ordered House of Hung of Singapore to refund a reported $485,177 to a plaintiff who bought a parcel of beryl from the company in 1988. Included in the parcel were 27 or 28 maxixe (pronounced ma-SHE-she) beryls. The buyer sent the gems to the Gubelin Gemmological Laboratory in Switzerland, which noted the maxixes were treated and that they lose color saturation under strong illumination.

The buyer wasn’t informed of this characteristic when he bought the stones, which he intended for resale, so he demanded a refund. The company refused, saying the invoice (which the buyer signed) noted the gems were maxixe and that they weren’t returnable. The company also said maxixe beryls don’t fade as quickly as once thought – a subject of debate among scientists.

But first, what is maxixe beryl and would you know one if you saw it?

Cinderella among gems: Imagine unearthing a deep blue gem material from a beryl deposit in Minas Gerais, Brazil. It’s breathtakingly reminiscent of a deep blue sapphire. But after conducting a few tests, you’re surprised to learn it’s beryl, though not the traditional “aquamarine blue.” The material comes from the same family as emerald and aquamarine, but it’s a rather rare form scarcely known outside of gem and mineral collector circles.

You’re in for another surprise: maxixe fades. How quick ly is a matter of debate, but the blue you admired was produced by irradiation in the earth and will fade to near-colorless when exposed to light. The brighter the light, the more rapid the fading. It will remain faded unless irradiated in a laboratory. However, lab-induced irradiation also is not stable in maxixe; the color will fade again when exposed to light. And of course colorless beryl is far less desirable and valuable than beryl with a bright, stable color, which brings us back to the Singapore ruling.

Back to the future: House of Hung, the seller, implied the buyer should have known what he was buying. Should the company have told the buyer anyway? What if the company itself didn’t know about the fading? “Ignorance … would not excuse the seller of the liability,” the judge ruled, adding that to warrant the name gemstone, a stone “must withstand the wear and tear of constant use and exposure to heat and light.”

Dr. Grahame Brown, a gemologist in Australia, and Don Palmieri, president of the Gemological Appraisal Association Inc., Pittsburg, Pa., were called on to perform tests to prove fading in maxixe. But Dr. Kurt Nassau, a scientist and author of the book Gemstone Enhancement, testified that those tests subjected a sample of maxixe to conditions a gem wouldn’t undergo with reasonable wear, including temperatures of 100x Celsius – the temperature at which water boils. Nassau agrees that full disclosure and explanations are always necessary. But he adds that the verdict on maxixe fading isn’t in yet. “I stated in my first edition of Gemstone Enhancement [1984] that these types of beryls were unsuitable for jewelry because of extremely rapid fading in accelerated fade testing,” he said. “But my second edition [1994] included my realization that these blue colors would last very much longer under normal jewelry wearing illumination.”

“Maxixe-type” aquamarines and golden beryls? A more troublesome part of the ruling, says Nassau, is the judge’s decision that four golden beryls and eight green aquamarines that were part of the parcel in question also were “maxixe-type” and that their colors would fade rapidly, too. The judge’s conclusion was based primarily on a fade test in which Brown subjected the stones to intense heat as well as intense light. “It is well known that golden beryls do not fade in light but do lose their color on being heated,” he says, “and that ordinary greenish aquamarines do not fade in light but lose their yellow component and turn blue upon being heated.”

Nassau is concerned about the effect this ruling will have in similar cases. “That a judge can come to such an unwarranted conclusion as this should be of great concern to the trade; quite innocent sellers could be trapped,” he says. “There is a provision in the American judicial system that an outside party can assist the court by giving independent evidence as a ‘friend of the court.’ I believe the U.S. jewelry industry should be prepared to play such a role – possibly through the Jewelers Vigilance Committee – if the occasion should arise.”

DIAMOND PRODUCTION TO TOP $7.6 BILLION

Diamond production in 1995 should exceed 114 million carats valued at $7.6 billion, says diamond consultant Martyn Marriott of London.

Based on his projections, Botswana will be the world’s top producer at $1.935 billion, followed by Russia, which is expected to sell about $1 billion through De Beers’ Central Selling Organisation and $400 million on the open market. Russia also polishes about $650 million of its production yearly.

Namibia is projected to be the highest producer by per-carat value, averaging $315. Some 90% of the nation’s diamonds are gem quality.

Australia is expected to be the largest producer by volume at about 45 million carats. But the country’s high percentage of industrials and very low quality “near gems” will bring the per-carat average down to $9.

Production of illicit diamonds is expected to total 270,000 carats. This category comprises usually high-quality diamonds that miners and exporters smuggle out of countries such as Zaire, Angola and Namibia to avoid export taxes, says Marriott. Smuggled diamonds account for more than 75% of Angola’s production and about half of Zaire’s, for example.

Marriott says his dollar estimates are higher than most other analysts’ because he factors in the 15% of rough that producers selling through the CSO have agreed to withhold from the market. He also adds the CSO’s usual 11% markup to achieve what he calls “full selling value.”

Although CSO sales of rough probably will total about $4.2 billion, or 55% of Marriott’s projection, the CSO’s market share of rough is actually about 75% because of stockpiled goods, he says.

ISRAELI DIAMOND EXPORTS RISE

Israel’s exports of polished diamonds will likely hit a record $4 billion this year, nearly $500 million more than in 1994, says Moshe Schnitzer, chairman of the Israel Diamond Institute.

Although profits remain severely restricted, he says, exports in the second half of the year should top the first-half total of $1.92 billion because of a heavier-than-usual influx of buyers in July.

First-half exports to the U.S. totaled $981 million, an increase of $73 million over the same period of 1994. Exports to Japan rose 42% to $445 million. Exports to Hong Kong rose 11% to $26 million, says Schnitzer.

These increases reflect a shift toward manufacturing larger, better quality diamonds, says Yigal Hausman, president of the Israeli Diamond Manufacturers Association. The shift began because Israel’s traditional niche of better quality melee has become unprofitable. Hausman recently asked De Beers for help in maintaining this part of Israel’s industry. De Beers director Gary Ralfe said the cartel was taking steps to address problems confronting today’s diamond manufacturers, including low profitability.

Ralfe said the “satisfactory partnership between De Beers’ Central Selling Organisation and its clients can only work effectively when clients make meaningful profits on their CSO rough supplies, commensurate with the capital already invested in their business.”

TURNING ASHTRAYS TO GEMS

Award-winning gem carver Michael Dyber bought a commercial ashtray made out of rock crystal quartz at the Tucson gem and mineral shows this year. But the non-smoker saw the ashtray more as “gemstone rough” – a crystal with possibilities – than a receptacle for ashes. He envisioned carving a series of gemstones from the piece.

What caught his eye was the glittering golden crystals that radiated throughout the otherwise colorless quartz. These inclusions are called rutile and come in many configurations and colors, including red, white, brown and, in this case, vivid gold. The inclusions develop in many forms, including single needles, angelhair (many randomly placed needles) and bright dramatic clusters.

Normally, Dyber chooses inclusion-free rough so the clarity enhances the optical effects of his gem carvings. “But here, the rutile reflects off of the pavilions adding dimension to the stones,” he says. “I feel it even increases the optical dynamics.” He calls it “the classy inclusion.”

Dyber speculates the “ashtray” material originated in Brazil – probably from the gem rich state of Bahi. He says good rutilated quartz is getting harder to obtain as more jewelers and customers become attracted to the random and natural placement of the inclusions. This randomness and Dyber’s unique carving and faceting style guarantee each gem will be a one-of-a-kind labor of love and act of nature.

Michael M. Dyber, P.O. Box 305, Rumney, N.H. 03266; (603) 744-2161.

ESTIMATED WORLD DIAMOND PRODUCTION, 1995 (‘full-setting’ value in US$)

*Comprises production from China, India, Indonesia, Lesotho, Liberia, Swaziland & Zimbabwe.

Source: diamond consultant Martyn Marriott, London.
Carats (000) Average Value (000,000) Price per carat
Angola 3,250 $750 $230
Australia 45,000 $405 $9
Botswana 18,450 $1,935 $105
C. African Rep. 450 $75 $165
Ghana 500 $15 $30
Guinea 500 $100 $200
Ivory Coast 600 $90 $150
Namibia 1,300 $410 $315
Miscellaneous* 1,000 $100 $100
Sierra Leone 625 $100 $160
South Africa 11,000 $1,160 $106
South America 4,000 $400 $100
Tanzania 100 $10 $100
Russia 12,000 $1,400 $117
Zaire 15,000 $450 $30
Illicit 270 $200 $740
Total 114,045 $7,600 $67