Making the Grade in the Diamond Market - a Mercantile Diamond Group Report
(EMAILWIRE.COM, May 28, 2013 ) Ontario, Canada -- A Colored Diamonds Grade Greatly Impacts Its Price. So How Do The Labs Decide On A Grade And What Do Dealers Expect From The Labs?
The relationship between gem labs and colored diamond dealers is a perpetual dance between two partners, each of whom has an important role to play. It is a wary relationship, with the lab acting as a de facto silent partner. The dealer buys the stone - rough or cut - fashions it into as beautiful a gem as possible, presents the polished stone to the lab and then waits to hear the result. Is this the most beautiful baby the lab has ever seen? Is it saturated with pure, unmodified color? Or is it teetering on the almost-out-of-reach, nearly invisible border between fancy light and fancy, between fancy and fancy intense, even between fancy intense and fancy vivid? Each time a colored diamond moves one level up the saturation scale, the value can increase by as much as 25 percent.
Approximately 60 percent of the colored diamonds that come to the Gemological Institute of America (GIA), for example, are in the yellow family - and what a wide and complicated group it is, with raucous relatives edging their way to the most saturated edges of the family tree, trying to be certified as not just fancy yellow but fancy intense. Meanwhile, their pushier cousins are trying to elbow past the intense in-laws, hoping to jump into the even-more-exalted vivid and deep categories. What is a grader to do? And how much will the graders opinion affect the price of the diamond? What recourse does a dealer have when that very expensive prized stone comes back graded one level below expectations?
Grading colored diamonds is a process involving science, good color vision and a conclusion based on the graders ability to think his way to a decision, according to John King, chief quality officer at GIA. He explains, when it comes to fancy color, you need to think of it as a box with three dimensions. Theres the side-to-side shift within the box from cooler to warmer that measures hue; the bottom shift from light to dark that measures tone and the front-to-back shift of strength that measures saturation.
Thanks to Mother Natures beneficence, there are thousands of combinations of these qualities. At the extreme edge of the box are the modifiers that lead to color descriptions such as orangy yellow, greenish yellow, grayish blue and the like. In spite of all these variations, King says, 80 percent of the yellow diamonds that come into the lab for grading have similar hue and tone, although they would vary greatly in saturation.
In The Beginning
Development of the GIAs color grading system began in the 1950s, according to Tom Moses, senior vice president of GIA, by working with Harry Winston, GIA Gemologist Bob Crowningshield and the late Arthur Wright, a colored diamond dealer. The very basic, descriptive terms for yellow diamonds needed to be unified and clarified. The question was what is a canary, what is a cape, what to call the stones that went beyond Z? For the other colors, Moses says, in the past, we would just say, for example, blue, or this diamond falls outside the D-Z spectrum.
By the late 1970s or early 1980s, fancy light came into the labs language, specifically because of the introduction of the radiant cut, Henry Grossbards design that revolutionized diamond cutting. By the 1990s, the labs color intensity descriptions included faint, very light, light, fancy light, fancy, fancy intense and fancy dark. In 1994, the lab added fancy deep and fancy vivid in recognition of the growing influx of more intensely colored diamonds. But that addition of new grades immediately made earlier certificates obsolete. The Golden Drop Diamond, for example, was rated a fancy intense because it was graded before the lab had a fancy vivid category. Moses admits that We were catching up with the market in nomenclature.
Romance or Science?
Although the marketplace insists on certificates to prove the value of a diamond, many dealers are uneasy with the notion of a lab essentially setting the price of a unique and beautiful gem, especially when the grade it earns is based on their subjective judgment. No matter how scientific the tests used, unless the grader has an actual diamond, or master stone of similar hue, intensity, tone and cut to use as a comparison, the ultimate decision as to whether a stone is a high fancy yellow or a low fancy intense yellow is like a close call at home plate. Its largely in the eye of the beholder and open to argument. But theres no argument that the final grade affects the price of the stone in the marketplace.
The problem is magnified many times over when no comparison master stone is available. In those cases, the grader uses Munsell color chips to assess the three attributes - hue, tone and saturation - that go into deciding on a grade.
Several dealers have asked to supply the GIA with previously graded diamonds of similar to the one being submitted but the logistics and cost of locating a comparable diamond and arranging for its handling and delivery would stop such a practice before it began. And yet, the process of comparing two things that are so different in value diamonds, with their endless absorption and transmission of wavelengths of light, against color chips that are flat, monotone and opaque is admittedly and inherently unfair.
Stephen Hofer, an expert in colored diamonds and colored diamond research, who worked with Bob Crowningshield way back at the dawn of color grading, says simply, You cannot compare two things that are different in value. He describes a fancy color diamond as a poet would: An undulating restless mosaic of reflected colors that captures the eye, stimulates the mind and enlivens the spirit. How can that amazing diamond possibly be compared to a numbered Munsell chip?
Christopher P. Smith, president of the American Gemological Laboratories (AGL) and former head of the Gbelin laboratory in Lucerne, Switzerland says, The systems are observer based theyre subjective. The goal is to make as much of the process as possible objective. For grading the hue, the easiest of the three qualities to measure, he suggests using spectroscopic measurements. You can define the hue. You can improve your consistency by relying on instruments rather than the naked eye.
Although beauty is not within the purview of the GIAs grading system, when a stone is graded by the Gbelin lab, the scientific report may be accompanied by a letter that addresses the elusive essence of that very element. The concept of the letter was introduced by Smith while he was head of the Geblin laboratory. In essence, it reinstates the romance of the stone after the diamond has been reduced to a grade, a clarity rating and a color description that tries, in no more than four or five words, to sum up a diamond.
The Argyle Impact
The appearance of the Argyle pinks, particularly the 50 or so stones sold at Rio Tintos annual tenders, upended the very idea of intense and vivid. Before, there were virtually no stones that fit those categories, which led some reddish pinks to be certified as pure red.
Reds are perhaps the most difficult of the colored diamonds to grade, partly because there are so few of them around and because the nature of the grading system does not allow for comparison of red-to-red stones. According to Hofer, Grade ranges were limited at GIA. When vivid and deep were added in 1994, it helped address a need for a wider range description. When the Hancock Red came on the market in 1987, an article in Gem & Gemologys Winter 1994 issue noted, Although it was not graded for clarity, inclusions were readily visible. The system was limping along behind a newly emerging range of colored diamonds. Smith notes, In the past, the vivid blue was only in theory. The lab had never seen a vivid blue. When these diamonds came along in numbers, however, they were first graded as deep, but Smith adds, The trade didnt like deep; so they made them vivid. But vivid or deep, the unanswerable question is where do you set the border between two grades?
Finally, the word descriptions of the diamonds being graded are an attempt to approximate the different hues within a stone. GIA uses 27 hue names as a guide to naming colors in diamonds but recognizes that there are at least 270 hue names and modifiers. The Munsell system at its basic level ranges from 1,000 to 7,000 different colors. If a diamond is viewed as part green, part yellow and part brown, it may end up with the ungainly designation of greenish, brownish yellow. Its beyond the scope of the lab to designate a stone as 30 percent green, 20 percent brown, 50 percent yellow, yet that is really whats going on in the word description. And when it comes to stones that appear to be equally two colors pink and purple, for example should the stone be labeled pink-purple or purple-pink? That simple semantic switch can change the apparent value of the diamond in the eyes of the dealer as well as the consumer.
Deciding on the color, or colors, of a diamond is further complicated by stone and saturation. Somewhere, within an imaginary three-dimensional box measuring hue, tone and saturation, all these qualities meet and the result is a grade that states the color or colors and their intensity.
But the real value a dealer in colored diamonds brings to the table stems from his or her expertise, accumulated during a lifetime of judging stones, both rough and polished, to see what someone else missed. Perceiving color is far from a science
This report is based on information available to the public. The information and any statistical data contained herein has been obtained from sources we believe reliable, but we do not represent that they are accurate or complete and should not be relied upon as such. The material contained herein is for information purposes only.
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