Diamond Market – May/June 2021

Posted on May 1, 2021 by Jon C. Phillips, GIA GG, CG (AGS)

Is it "Real"...or not? This is usually the time of year when we look back at last year and do our comparisons to generate our expectations for the coming year. As you probably know, last year was basically a write off, the worst in 30 years. So, when you hear jewelry sales are up 106% (Diamonds.net) from last March you have to understand that’s good but not as spectacular as you would think at a glance. I guess we are all trying to find a feel-good story. When dealing in percentages, you can often be misled in thinking that we are well out of the woods and on our way to greater prosperity. It’s not true, and while we are definitely doing much better than last year, we are currently also experiencing a shift back to some old bad habits, which are dangerous for our industry’s growth; like oversupply of rough, memo goods, and misleading advertising. Okay, enough of the downer but hopefully you understand that the diamond industry is still in a state of uncertainty despite all the wonderful comparisons to last year. Gem Certification & Assurance Lab (GCAL) released informa- tion on their new 8X grading report for diamonds. You are likely aware of the traditional industry term of “Triple X” or “3X” for round brilliant cut diamonds that have been graded as having excellent cut, excellent symmetry, and excellent polish. The X is short for Excellent, so Triple X really just means Triple Excellent. A diamond’s cut, symmetry, and polish grades indicate the quality of craftsmanship that went into transforming a diamond rough into a polished stone. All three affect a diamond’s interaction with light and are described on some grading reports as Excellent, Very Good, Good, Fair, or Poor. To qualify as a GCAL 8X diamond, a diamond will need to have an excellent grade for all eight parameters set out in its report. They include polish, external symmetry, proportions, optical brilliance, fire, scintillation, optical symmetry, and hearts and arrows. On the GCAL website it states that, “The 8X Ultimate Cut Grade was developed to distinguish the best of the best diamonds” and goes on to say, “In today’s market, more than half of all round brilliant cut diamonds are given ‘Excellent’ Cut grades, but less than 1% of those will qualify as 8X.” FIGURE 1. LGDs in fashion jewelry. Courtesy of Light Box (De Beers). The question is—is this kind of extra scrutiny really necessary? Will anyone care? I personally feel it is overkill and another attempt to commoditize diamonds, which definitely had mixed results over the years. The jury is still out obviously and I suspect that there will be some uptake but it will be limited. It’s a move to capture a decidedly small market share of those with a penchant for perfection. I wonder where you stop. Is there a 10X in the works? 8X may be more practical for online sales platforms where you don’t generally get to talk to a sales associate. As a retail consumer when there is no one to explain to you what all those numbers really mean in real life terms you would likely arrive at the conclusion that the 8X has to be better than a 3X—it’s a bigger number. What if it only gets 5X? Is that better than a 3X? While we currently hold 3X (or Triple 0’s for some) out as the best in the diamond trade we also know that not all 3X are created equal and I am sure this is where the idea came from. As my good friend Mel Moss, the diamond broker, always says, “Most 3X still need to be seen to be sold properly.” 3X is a range of parameters, not exact numbers, so 8X purports to narrow the range and is meant to act as a major differentiator for sales. In the... FIGURE 2. Zimnisky report. Courtesy Paul Zimnisky

GemWorld articles are accessible by GemGuide members only. To access our archive of articles and get many other great features and benefits, become a member now!

Become a member