Rarity and Value
Diamond forms deep in the earth, in the mantle to be specific, unlike all the other gems which were formed in the crust. The unique crystallization of carbon atoms in cubic form is only possible under such high temperature and pressure conditions. Although the volume of industrial quality diamond production is somewhat high, gem quality diamond is rare. After all, approximately one ton of kimberlite or lamproite (rare diamond bearing rock types) needs to be worked in order to get one carat of gem quality diamond. Therefore, the larger they are, the more valuable and rarer they will be.
Two diamonds of one half carat each of a particular color and clarity will cost considerably less than one diamond of one carat of the same quality even though they both have the same total weight. The diamond grading scale is also a factor in rarity and value. Diamonds of very high color and clarity are much rarer than diamonds of lower color and clarity. As a result, the price can be astoundingly different for two diamonds that are the same sizes but have differences in quality grades.
The price of diamonds is ultimately determined based on the 4 C’s: Color, Clarity, Cut, and Carat weight. Most consumers are familiar with these terms today. The system was developed in the early 1950s by the Gemological Institute of America. It became a worldwide standard for grading and valuing diamonds and evolved over the years. Other independent laboratories created their own grading systems such as the American Gem Society. Although the AGS scale differs from the GIA scale, the terms can be related back to the GIA scale, reasonably close.