Tough Bidding for the Pink Tender

After a month-long, four-continent tour, the most important pink diamonds in the world were sold at silent auction last month in Geneva. It was the 14th annual pink diamond tender staged by Argyle, the Australian diamond company.

Since 1985, when Argyle began showing its pink collections, the tenders have been each year’s highlight for the fancy-colored diamond market. This year’s collection totaled only 63 specimens, most weighing less than a carat. And while the largest (not the best of the collection) weighed in at an acceptable but not imposing 3.15 cts., it should be noted that these are the only fancy pinks in the world offered directly to the trade. It was expected that the collection sold for well over $6 million.

Bidding is strictly a wholesale buyers’ opportunity, and even the viewing was by invitation only. “There was an increase in inquiries this year,” according to David Fardon, manager of Argyle’s polished sales division. Extra invitations were granted to those who qualified, and the New York viewing – the first ever in that city – was extended a day to accommodate the crowd of potential bidders. The other viewing sites were Hong Kong, Tokyo, Sidney, London, and Geneva.

The five Cs of pinks. (1) Carat Weight. The collection consisted of 59 fancy pink diamonds weighing a total of 55.27 cts., two fancy reds (a 1.06-ct. oval and a 0.54-ct. emerald cut), and two fancy grays (a 2.34-ct. emerald cut and a 0.59-ct. round). In total, there were 18 round brilliants, 16 ovals, 15 emerald cuts, seven princesses, five marquises, one lozenge, and one heart shape.

While Argyle prefers that tender diamonds be above 0.50 ct., the collection included two important stones under 50 points because of their extraordinary color: a 0.44-ct. oval brilliant and a 0.46-ct. emerald cut. Both had exceptional color grades, assessed by the Gemological Institute of America as fancy deep purplish pink and the Diamond High Council (HRD) as fancy intense purplish red.

(2) Color and (3) Cut. With fancy colored diamonds, color is by far the most important C. Of the more than 40 million carats of diamonds mined at Argyle last year, fewer than 10,000 carats (.02%) are color graded as “pink.” This includes everything from thousands of carats of very slightly pinkish-brown “champagnes” to this incredibly rare tender collection of 61 fancy pinks and reds (approximately .0001% of all diamonds mined at Argyle, or one out of every 650,000 carats). Because of its importance, pink Argyle rough is never sold on the open market. It’s cut and polished at Argyle’s own cutting facilities because it’s not known what the color will be until after the gem is fashioned. As you would expect, great care was maintained in proportions and finish of the 63 fancies offered in the tender collection.

One cannot overestimate how rare these colors are. They are truly unique, with many of the 61 pink and red diamonds garnering some of the highest color grades possible in their categories. An amazing 15 diamonds this year received a “fancy vivid” grade, GIA’s top grade. (GIA’s color scale, in order of importance, is “fancy light,” “fancy,” “fancy intense,” and “fancy vivid.” “Fancy deep” is a darker tone, usually intense in saturation.) This was the most vivids ever in one collection.

Featured in this year’s offering was a 2.66-ct., heart-shaped fancy vivid purplish pink (JCK, October 1998, p. 19). “Without a doubt, it is the key stone of an impressive collection,” says Fardon. The entire grouping of gems ranged in color from fancy pink to fancy vivid purplish red.

(4) Clarity. The clarity grade of the 2.66-ct. heart is I2, the next-to-last clarity grade on the scale. Who cares? Most of the 63 diamonds were graded SI2, I1, and I2. Even the heart’s I2 clarity most likely didn’t affect anyone’s final bid. There were nine fancies graded VVS and VS, but, in these rare instances, clarity must not disrupt the focus on color. You can almost ignore clarity when estimating a value for such rare pinks and reds.

(5) Certification. All of the tender was graded by both GIA’s Gem Trade Lab and Antwerp’s HRD laboratory. Why two certificates on each stone? According to Fardon, there are clients in the Far and Middle East who prefer GIA’s report, and just as many Europeans who prefer an HRD report. And there are some slight differences between the two gradings. GIA has a “fancy vivid” label, whereas HRD stops at “intense.” But HRD, which is quicker to give a “red” color grade, graded eight stones in the collection as red, whereas GIA graded only two as red. And stones that GIA graded as violet-gray were called grayish-blue by HRD. While HRD graders gave a good number of stones one-clarity upgrades over GIA’s assessment, the one grade makes no difference in the gem’s value or beauty.

Auction Results

Year Total carats Total number of diamonds Total number of diamonds Sale price
1985 18.30 33 N/A N/A
1986 32.00 56 2.11 cts. N/A
1987 59.65 83 2.01 cts. N/A
1988 67.59 88 N/A N/A
1989 64.38 67 3.20 cts. N/A
1990 40.93 36 N/A N/A
1991 40.15 47 N/A N/A
1992 43.39 50 2.09 cts. N/A
1993 41.48 46 3.05 cts. $2.25M+
1994 45.17 47 3.04 cts. N/A
1995 45.22 47 2.80 cts. $4.5M
1996 47.82 47 3.66 cts. $4.7M+
1997 58.64 59 N/A N/A
1998 58.20 63 2.66 cts. N/A

Who can afford them? Even with Japan and several other Asian countries faltering economically, there’s still demand for these important diamonds, enough to keep the silent bidding going strong. Here’s how it works: A silent tender is described as an unconditional offer of money for an item (or items), payable on demand after that offer has been accepted. Obviously, Argyle will choose the highest bid, but it’s more complicated than that, since each bidder can make offers on a single diamond, a number of individual diamonds, a group of diamonds, or even the whole lot.

To purchase the entire offering is not uncommon, as Geneva jeweler Robert Mouawad, GIA’s most generous donor, has proved twice. Mouawad bought the entire 1991 and 1993 tenders. The sale price for the 1993 collection of 46 diamonds – weighing a total of 41.48 cts. and including a 1.17-ct. fancy-intense purplish-red emerald cut and a 3.05-ct. fancy-intense purplish-pink fire rose kite – was more than $2.25 million. Of course, Argyle retains the option to refuse any offer it feels isn’t worthy of its pink beauties.

What are they going for? To own these pinks, how much should you bid? “The rule of thumb, strictly for consumer interest, of course,” says Fardon, “is to multiply the colorless equivalent by 20 to 25 times.” For the smaller and lighter pinks, you need only multiply by 10. But for the special pinks, like the 2.66-ct. heart, multiply by 50 or more! Exactly how much was paid for the collection will be announced only if the buyers give Argyle permission to release the results.

At these prices, “these diamonds are for an international market – not really for the U.S. domestic market,” says Fardon. As in the past, the Argyle pinks will “probably go into royal collections, especially in the Middle East,” he suggests. With the stones most likely going for more than $100,000 per carat, that seems a pretty safe guess. But of course, you never know what will strike the fancy of Bill Gates or Warren Buffet.

Weight Estimations Made Easy

When you need to determine the weight of a mounted gem, you first measure its height, width, and depth. Then, you either plug those measurements into a standard formula and use a basic calculator to gauge the weight or key those figures into a specialized gem calculator or gem-appraisal software with the formulas built in.

Most of the mathematical formulas for calculating weights, regardless of the method used, derive from a Gemological Institute of America course dating back more than two decades, with contributions over the years from others. But a new set of weight-estimation tables has just been published by longtime jewelry appraiser Charles Carmona, a Graduate Gemologist and president of Guild Laboratories in Los Angeles. His book, The Complete Handbook for Gemstone Weight Estimation, is an invaluable resource.

Using size to determine weight. Carmona has been collecting and developing formulas for many years. For mathematically challenged jewelers, appraisers, and laboratory gemologists, his new book provides more than 400 pages of formulas and tables to estimate the weights of almost every shape and variety of mounted gemstones.

The book contains formulas for 24 common and 48 uncommon shapes – pentagons, octagons, kites, losenges, diamond profiles, calves heads, trapezoids, epaulets, blocked pear shapes (the Empress), bullets, five-pointed stars, half moons, briolettes, tablets, beads, bar cuts and buff tops, clovers, and even tongues.

The tables use standard calibrated measurements. In other words, Carmona has done the math for you. All you need to do is measure the stone, look up the gem and its chart, and find the listed measurements; it tells you the weight.

“It will be a great tool for appraisers, jewelers who buy and sell secondhand, pawnbrokers who have to estimate weights for their pawn agreements, and any other situation where the weight needs to be calculated,” says Carmona. The standard calibrated measurements make it easier to estimate weights of gems set with closed backs.

“These formulas are based on German-cut calibrated stones as a standard,” he explains. “German stones are machine-cut and as consistent as can be.” Because cutting styles have changed since GIA developed its formulas, Carmona says, his estimates differ from GIA’s by about 5% to 10%.

“There are eight columns in each table based on specific gravities [S.G.’s],” says Carmona. One column includes “stones in the S.G. range of 2.55 to 2.75,” which encompass amethyst, aqua, chalcedony, citrine, coral, emerald, iolite, sunstone, pearl, and turquoise. Opal weights are estimated by subtracting 20% from the estimated weights on the list. Another column covers the S.G. range of 2.90 to 3.10, which includes nephrite, tourmaline, and an additional nine gems including actinolite and brazilianite, according to Carmona.

There are 18 separate formulas for diamonds, six of which come from GIA. These have not changed. Diamond shapes include the princess and square princess, Radiant, cushion and square cushion, Trilliants, cut-corner triangles, Old Mine cuts, Old European cuts, and rose cuts.

Carmona cautions that “nothing is exact with weight estimations. It still requires manual skills and critical thinking.” The book offers helpful hints in these areas in addition to the tables.

If you don’t have the book, you can perform basic weight estimations using just a few tools and formulas.

The Leveridge gauge. Although some jewelers use calipers, micrometers, and other gauges, the standard tool for measuring mounted gems is the Leveridge gauge. You can use this device to measure prong-set as well as bezel-set gems. When measuring depth, you can add a small attachment for hard-to-reach culets. It penetrates the small opening below the head of most well-made mounts.

Accompanying the gauge is a small booklet of weight tables. While the tables are accurate, they’re limited to the standard, common shapes. The company that developed the gauge, A.D. Leveridge, was recently acquired by a Singapore firm called Presidium, which now markets a digital Leveridge gauge.

GIA’s Graduate Gemology course. GIA course materials include methods and formulas to estimate weights of diamonds and colored gems. These are useful for the common shapes that retail jewelers encounter daily.

“We got a lot of our formulas from GIA texts, which have since become standard in the industry,” says Richard Drucker, publisher of The Guide, a widely used publication listing prices of colored stones and diamonds. The weight-estimation tables in The Guide borrow from Carmona, and Drucker himself developed some of the formulas.

Significant contributions to the weight-estimation tables also come from Richard Homer, a Graduate Gemologist and professional cutter of Gems By Design in Kent, Ohio. Homer has measured and weighed thousands of stones and devised formulas, concentrating on unusual shapes.

Software programs. A number of jewelry appraisal software programs come with weight-estimation formulas. One of these is The Jewelry Judge, marketed by a company of the same name in Garden City, N.Y. Its formulas derive mostly from GIA’s, with contributions from Drucker and Homer. The Jewelry Judge also has formulas of its own, particularly for emerald cuts. However, it covers only the basic shapes.

Other software programs that use GIA weight-estimation formulas include Adamas Advantage (Adamas Gemological Lab, Brookline, Mass.), Quantum Leap (Quantum Leap Software Programs, San Diego), and the Carat Jewelry Appraisal Program (Princeton, N.J.). These programs also borrow formulas from Drucker, Homer, and Carmona.

You can order The Complete Handbook for Gemstone Weight Estimation for $49.95 from Gemania Publishing, 550 S. Hill St., Suite 1188, Los Angeles, CA 90013-2412.

Getting Old Mines to Yield New Finds

A one-year pilot program to locate overlooked gemstones in heavily worked Brazilian mines has produced encouraging results and will be extended. Global Mining of Mountaindale, N.Y., the firm directing the effort, has registered a Brazilian company called Mineracao de Alta-Technologia Ltda. to continue the work.

The key to the project is a Global Mining technology that uses electromagnetic wave-scanning to identify potential gemstone-producing pockets called “vugs” in the tunnel walls of old mines. Vugs were found in three mines – the Cruzeiro, Santa Rosa, and Coroa de Ouro – but no major gemstone concentrations turned up.

The potential for major discoveries does exist, however, according to Warren Brennen, a mining geologist familiar with the territory. He estimates that past mining may have missed almost as much gemstone material as it recovered, with gems hidden at varying depths.

Meanwhile, Global is considering proposals to put its system to work in Australia and Tanzania. Global also has created a new firm called Mountaindale Rocks Inc. to handle marketing of its product. – David Epstein


November’s Birthstone

Topaz has been such a misunderstood gem for so long it’s a wonder it ever became a popular birthstone. In ancient Rome, all yellow and greenish-yellow stones were called “topaz.” When peridot, a yellowish-green gem, was discovered on the Isle of Zabargad in the Red Sea, the gem was called “topazos,” meaning “to seek,” since the island’s fog made it hard to find.

Yellow andradite garnet, the same species of the more important yellowish-green demantoid garnet, is called topazolite. For centuries, yellow quartz (citrine) has been called topaz or Bohemian topaz. The brown variety smoky quartz is referred to incorrectly even today as smoky topaz. Other gems have used topaz as a varietal name, including yellow sapphire (called Indian or Oriental topaz), yellow star sapphire (star topaz), and even obsidian glass (Nevada topaz).

Gemologically speaking. Topaz is its own individual mineral, an aluminum silicate, with a hardness of 8 on the Mohs scale. While its durability and popularity may lead you to believe that it’s a very wearable stone, it does exhibit what’s known as a “perfect cleavage”; if struck, the gem can split in two pieces. Most jewelers prefer to set topaz in pendants or rings to be worn only on special occasions. Gem cutters are familiar with this vulnerability and orient every faceted topaz so that the cleavage direction is approximately 15 degrees from the top table facet, greatly reducing the risk of damage.

Colors. Topaz comes in a number of different pastels but actually is colorless in its purest state. It has been regarded as one of the finest yellow gems, showing up in many art deco jewels. Today, it’s most popular as an intense “London” blue, although it’s irradiated and then heated to reach this color saturation. Other colors include a complete range of yellows through orange, a very light green, a more typical natural light blue, pink, a “sherry” reddish-orange, and even a very rare red.

Colors from Brazil. The largest producer of topaz is Brazil, in its Minas Gerais district. Ouro Prêto, the historical capital of the state, is where the most important color, “imperial” orange-red, is mined. “We have the blues and the imperials,” says Daniel Sauer, son of Jules Sauer, owner of Brazil’s largest and world-renowned colored gem retailer, Amsterdam Sauer. “The blues are the least expensive, because they’re irradiated, but still one of the most popular gems in the market today, even in comparison to the amethyst.” Sauer also claims to be the biggest promoter of topaz in the world. “It’s not a rare stone, from colorless to blue. They are very inexpensive. Retail cost would be between $5 and $15 per carat, depending on the quality of the cutting and treatment.” Sauer is quick to point out that very few stones have the moderate blue hue of an irradiated blue topaz. An equivalent saturated blue aquamarine would be very expensive.

“We see every color – light yellow through orange, light pink, moderate pink, salmon pink, and sherry. And no matter what the color of topaz, other than blue and colorless, we call it ‘imperial.’ This is how we market the stones in Brazil. It’s very difficult to determine the borderline of a pinkish orange or reddish orange. The difference, you see, is in the price, not the name. The same is true with pink sapphire and ruby,” explains Sauer.

Some may try to sell pink sapphires as “pink ruby.” “The price is there to distinguish between the two,” says Sauer. “It doesn’t matter whether it’s called ruby or sapphire – it’s the market that determines the gem’s worth, not the name.”

Costs. What jewelers call imperial in the United States – the reddish orange hues – can sell from $1,500 per carat to well over $3,000 per carat retail, according to Sauer. “Go back to the light yellows. They will sell for $20 and up. Topaz has a huge range of prices with some very good color differences – lots of options.”

The very fine and rare topazes from Ouro Prêto, for the moment, are in slow but steady supply. “Production there is more difficult these days,” according to Sauer, “so prices are up a little bit, 10-15%, over last year.”

Astrological gems. Scorpio, Oct. 23 to Nov. 21, has the beryl as its talisman. This would include emerald, aquamarine, and morganite (pink), as well as yellow and red beryls. Sagittarians, those with birthdates from Nov. 21 through Dec. 20, can wear November’s birthstone, topaz.