Coloured Diamonds

 Argyle Diamonds

"One year's Argyle production
fills a small truck, but the pink diamonds would only half fill the
ash tray."

- David Fardon from Argyle on
  the rarity of pinks

Before the discovery of the Argyle diamond mine, most pink diamonds were a pastel shade worthy of passing interest, but not lasting passion. This all changed in 1985. The Argyle mine in the far north of Western Australia, produces almost all of the world's red and pink diamonds, although they only make up a tiny part of the mine's production.

Until 2009, the huge open cut mine has been the world's largest diamond mine in total carat weight. In 2007 RioTinto decided to start an underground mine because the open cut has become too deep taking too long for the trucks to drive down the spiral pit – the smaller output from the underground mine will greatly reduce the availability of pink diamonds, and probably drive-up the already high prices.

Pink diamonds cost from 5 to 100 times as much as colourless diamonds.

Scientists do not fully understand the cause of the pink. Usually is caused by impurities, but Argyle diamonds are very pure. They are found in a rock called Lamproite that appears to have had a particularly violent journey through the earth's crust. (All other diamonds were transported to the earth's surface in a rock called Kimberlite).

This unique host rock and the transition to the surface means it is unlikely another mine like Argyle will ever be discovered. So once the underground mine at Argyle dries up, in around 2017, it's sayonara pink diamonds!

Argyle Tender

Argyle offers its finest 50 or so pink diamonds each year in a sealed bid tender. In some years the tender includes a red and, occasionally, a blue diamond. The event has become widely reported.

The tender opens in Perth before a week in Hong Kong, Tokyo, Mumbai, New York, London and finally Geneva where the bids are opened. Prices usually exceed US$100,000 per carat. Many of the world’s rich and famous are the eventual owners. It is said the Sultan of Brunei has a standing bid of US $1million for any red diamond bigger than 1ct. Apparently he is building a collection that will one day appear as a magnificent suite of jewellery. Some of the diamonds are still waiting underground in Western Australia.

Champagne Diamonds

Champagne or brownish coloured diamonds are the most affordable coloured diamonds, at around one third the prices of white diamonds. This good buying will not last forever and Argyle champagne diamonds have some unique features.

Prices for colour C1 (lighter) to C6 (the colour of cognac) are all about the same. Lighter stones are popular because they sparkle more and cost less than pure colourless. More intense colours are also popular because they are more unusual, so supply and demand are balanced.

You can simply choose the colour you like best without worrying about which is more valuable. However there are many different secondary colours and this is important. In general warmer colours are more attractive than grey-greenish browns (indicating the diamonds have not come from Argyle). Intense golden and rusty colours are called Fancy Cognac, or C7 and cost a little more because they are quite rare. (The French cognac people do not allow the use of their word – but the champagne people like the idea!)

Naturally champagnes with a pinkish tinge are the most sought after and expensive. Champagne diamonds (and most other coloured diamonds) are often more heavily included than white diamonds.

Coloured Diamonds - The Facts

Over recent years coloured diamonds have become increasingly popular. They are not new with some of the most famous diamonds being coloured – The Tiffany (yellow) and The Hope (blue) to name two.

Colour is a very important factor in diamond grading, or more correctly absence of colour. Most diamonds are graded on a whiteness scale or absence of colour scale. While most diamonds are in the colourless to light yellow range, some have a natural colour that is deep, distinct, and opulent. These are known as fancy-colour diamonds and are often blue, brown, or pink. Unlike colourless and near-colourless diamonds which are valued for their lack of colour, fancies are valued for the intensity of their colour.
Over recent years coloured diamonds have become increasingly sought after and expensive. But how does colour come about and how does it affect the price?
 

What Causes Colour in Diamond?

Diamonds are very pure carbon that crystallised more than 100km beneath the earth's surface. Diamonds grow under immense heat and pressure; they must be transported to the surface within an hour or two in a volcano. In a way they are snap frozen and if the journey takes too long they revert back to graphite or carbonaceous gases.

Sometimes other atoms are trapped in a diamond as it grows or during its violent ride to the surface. The most common is Nitrogen; the tiniest amount causes blue light to be absorbed giving the diamond a yellowish colour. Argyle diamonds, mined in Australia, are an exception as they are actually very pure; the cause of the rare pink is a freak of nature and also unfortunately means they have many more inclusions than most diamonds from other sources. The worry is that once the Argyle mine runs out of pinks, the diamond world will be a less colourful place. In 2009 the mining virtually stopped and stockpiles of ore were the main source of pinks. Argyle had begun developing an underground operation because the open cut is no longer viable. But the global financial crisis has put that development on hold. Personally I believe Riotinto will try to sell the mine as they are strapped for cash and a smaller underground mine does not fit their portfolio.

Rarity

Intensely coloured diamonds are the rarest and most beautiful of nature's gem treasures. Rarity and desire are the two things that set the price of coloured diamonds. The most rare and prized in order are red, blue, pink, green, gold and then yellow, milky white, champagne and black. Values can be 100 times more than that of a white diamond!

The long standing highest price per-carat ever paid was $1,250,000 for a 6mm purplish-red badly flawed 0.90ct diamond of just less than 1 carat (inclusions are common in natural red and pink diamonds). It was named the Hancock Red.

In May 2009 this record was surpassed when a flawless vivid blue diamond weighing 7.03 carats sold for a record $9.49 million, the new highest price paid per carat for any gemstone. This stone was planned using my associates inclusion scanning equipment. Then in November 2009 a 5ct VS1 vivid pink sold in Hong Kong for $2.1M per carat. So in the midst of a financial crisis the record price was broken twice, which goes to show where the smart money goes in times of trouble.

Blue Diamonds

Natural blue diamonds are a light greyish blue shade, a more "steely" colour than sapphire. The most famous blue diamond is The Hope diamond in Washington's Smithsonian Institute.

This stone is steeped in legends of horrible deaths that befell many of its owners, from guillotining during the French Revolution, to a Wall Street broker jumping to his death in 1930. A lead molding from the ‘French Blue’ was scanned by Scott Sucher using my associates advanced technology to prove the stone was recut from the earlier versions.

New York jeweller Harry Winston purchased it to donate to the Smithsonian and only owned it briefly. While his insurance company and armed couriers were discussing the cost and method of delivering the priceless gem to Washington, it’s reported that Harry strolled down to the post office and posted the diamond in a cigarette packet as ordinary mail!

Green Diamonds

Green diamonds have come in contact with radioactive minerals such as uranium. Radiation stains the outside of the diamond, so the cutter must be careful not to cut away too much of the green "skin". Authenticating that the radiation occurred naturally requires laboratory analysis at a leading gemmological institute; often the cutter submits the stone as rough and during the cutting process. Buyer beware!

Yellow and Orange Diamonds

To be called a Fancy colour means the diamond has more colour than Z (face up) on the GIA D-Z white diamond grading scale. Fancy yellow diamonds come in a range of hues from greenish yellow to orangy-amber. They start at similar prices to white diamonds and prices rise with increasing intensity.

Connoisseurs in the trade use the term "canary" to describe intense yellow. Burnt orange Argyle champagne's are a less expensive alternative to very expensive pure gold or orange colours.
The Ellendale mine, discovered about the same time as Argyle, has been opened and operating for the past several years and it has produced many fine fancy yellow diamonds.

White-milky Diamonds

A little known and quite rare diamond is a white opalescent diamond. These are collector's oddities and we have a small selection at Holloway Diamonds. They are a lot less expensive than transparent colourless diamonds, and we think they were a real bargain. There have been articles written about them recently in Gems and Gemmology, a journal created by the GIA. Who knows, they may become the next fashion thing like black diamonds.

Black Diamonds

Pave' set Black diamonds are popular in high-fashion jewellery. We have a large collection of the latest black and white diamond designs. They often used in men's jewellery.

Most of the black diamond fashion jewellery is made with irradiated treated coloured diamonds. Natural untreated black diamonds with a good surface lustre are rare. Many other black diamonds are low clarity diamonds that when heated go very dark grey.

"Genetically Modified" Colours

Demand for coloured diamonds in Europe and America is outstripping supply, so prices are going through the roof. It is no surprise then that technology is being used to artificially create colours.

At the Las Vegas trade fair one trader had 30 beautiful colours, each available in any size, shape or consistently matched quantity. The colours were created with sophisticated high temperature, high pressure and irradiation processes.

Coincidentally, at my Argyle cutter's office a few weeks later I met the founder of that company who joined us for lunch. He told me that he and a university professor experimented for years and perfected the colouring processes.

They can predict the colour change from low-quality less expensive diamonds. He uses this specialised knowledge to buy diamonds at cutting centres, and ships them to New York where the now wealthy professor treats them. This is "clean" business with no dangerous residual radiation and the stones are sold with the treatment declared. They supply large jewellery manufacturers with sets of diamonds that are sold with full disclosure.

Imagine this technology in the hands of less scrupulous people? Many Eastern European countries have turned their research facilities into diamond treatment businesses.
 

GE Bleached Pegasus Diamonds

Disclosure is an issue of great concern. General Electric Company has produced synthetic diamonds for industrial abrasives since 1955. In 1999 GE's research and development people discovered a way to improve the colour of some rare large diamonds (type II) using an advanced high pressure / high temperature treatment. The whitened gems more than doubled in value and are clearly marketed as Belataire diamonds.

The gem industry was confronted with an ethical dilemma. Legitimate gem dealers are required to disclose any treatments on invoices, but GE maintained the process duplicated nature and could never be detected, thus disclosure was unnecessary. The issue would have remained unresolved but for gemmologists discovering a number of tests to identify Pegasus diamonds.
 

Branding Gems

Access to technology in third world countries has led to an inevitable rise in the number of undisclosed treated gems.

Passing treated fancy coloured diamonds off as natural is a great way to turn a quick buck. Branding and independent certification of gemstones have become more common as a way of guaranteeing authenticity of untreated gems. Australia's Argyle Diamond Company was first to brand its diamonds by source. BHP-Billiton have tried and largely failed at branding diamonds from its new mine in Canada. They are inscribing a polar bear on the girdle or edge of diamonds that are cut and polished by locally trained Inuit workers.

De Beers too is re-inventing itself. It aims to establish a leak proof supplier of choice chain, eliminating "conflict diamonds" that fuelled wars in Africa during the 1990's. The cutters De Beers supply will be encouraged to market and brand with the famous slogan "a diamond is forever". And for the first time ever De Beers itself will retail diamonds under its own name in several new stores around the world. They will be selling to their customer's customer's customers.