Color gemstone industry in state of constant flux

Twenty years ago it was assumed that 99.99% of all corundum was simply “heated,” all emeralds were “oiled,” and all blue topaz was “irradiated.” These were considered traditional treatments, accepted by the trade, so it wasn’t necessary to disclose anything to the consumer. But relentless advancements in technology have affected the colored gemstone industry and will continue to do so, notably in the area of treatments, disclosure, and pricing.

Richard Drucker, publisher of The Guide, a trade pricing book for color gems and diamonds, said during a seminar that, traditional enhancement or not, identification and disclosure are critical. Drucker’s seminar, titled “The State of the Gemstone Industry,” took place Thursday at The JCK Show ~ Las Vegas 2005.

Drucker cited such advanced treatments as diffusion, bulk lattice diffusion, heat with glass residue, glass filling, resins, wax, dyes, polymer impregnation, and coatings, and said he knows how each treatment affects values.

Drucker, the president of Gemworld International in Northbrook, Ill., said there are three value levels for ruby, emerald, and sapphire: gems that have been treated by “traditional” methods; gems that have been treated by unacceptable or questionable methods; and gems that are natural and unenhanced.

Heat is still considered “traditional” for ruby and sapphire. The latest enhancement retailers should be aware of is low-temperature glass filling. Extreme heat treatments that leave glass or flux residue, or even synthetic ruby residue inside natural ruby, result in much lower prices than traditional heat treatments.

Drucker said most of the ruby in today’s market is from Mong Hsu and that it’s heated, resulting in the possibility of residue. Because it’s so common, Drucker said future pricing in The Guide will be based on these gems. Jewelers need to describe the treatment, make the necessary disclosure, and then determine the proper value. For example, a heated (with possible residue) 1-carat Fine (7-8) Burmese (probably Mong Hsu) ruby, should be priced somewhere between $1,500 and $2,000 per carat. An unheated Burmese ruby, of Fine (7-8) quality can be priced 25 percent to 50 percent higher, or roughly $2,500 to $3,500 per carat.

Drucker predicts that 90 percent of the ruby in the market will be heated Mong Hsu. New pricing charts in The Guide are anticipated to be divided into two separate categories: Ruby—all origins and heated; and Ruby—no heat.

Under heated ruby, pricing categories will be broken down into three sub-categories: Traditional Heat, New Heat Process, and Outrageous, which include diffusion and bulk lattice diffusion.

Beryllium treatment—which changes sapphire colors into pinks, oranges, padparadschas, yellows, and even blues—falls into Drucker’s “outrageous” category, and identification is a problem, he said.

“Millions of carats are available for this treatment,” Drucker said. But identifying it can cost more than the value of the stone. Pre-beryllium prices show fine-quality orange sapphires priced at $300-$450 per carat. Because of the unaffordable identification, “post-beryllium Fine-quality orange sapphires are valued at $50 to $150 per carat,” said Drucker.

Drucker also discussed emerald treatments. He noted that oil had been considered the traditional method of choice, but he questioned whether or not cedarwood oil, a synthetic resin and the current treatment of choice, can be considered a “traditional” treatment. Treatments in Drucker’s “New” category include Arthur Groom’s ExCel, but unstable resins with hardeners belong in the “Outrageous,” category, Drucker said.

The problem with establishing differing value levels, Drucker said, is that it is “nearly impossible to identify fillers in emeralds without expensive testing.”

At present, GIA offers two reports, an emerald report and an identification report. It is important to note that the identification report will state only “evidence of clarity enhancement present.” The emerald report will state the same along with the quantity of filler as minor, moderate, or significant.

The AGTA laboratory offers to quantify the amount of filler on its reports as a normal service. Upon request, it will include the type of filler.

Drucker predicted that in the future gems may be altered to the point that nature is unrecognizable. Treatments may continue to result in lower prices in some categories. Demand for natural gems will remain high, so prices will continue to rise as they become more scarce.

There will be a greater burden on suppliers to disclose, with greater challenges in identification. And for the retailer, Drucker said, appraisals should include addendums on treatments.

Appraisal Challenges. Drucker, whose Gemworld International produces The Guide Appraisal Software, said that appraisal challenges recently have come into his lab. Some appraisers have been finding it difficult to identify “flash” from fillers vs. natural iridescence within natural diamond fractures. He said the two are very different and, under examination, should not be difficult to distinguish. It will continue to be difficult to identify synthetic ruby vs. flux residue in natural ruby, beryllium treatment in sapphire, and created vs. HPHT-treated diamond.