RAPAPORT... Although emeralds represent one-third of the “big three”
group of precious colored stones, it is the other two gemstones in that trio —
sapphire and ruby — that typically have received greater attention. But
emeralds have definite advantages, especially in today’s environment — they are
more affordable, have great profit potential for retailers and are available
from numerous sources.
Jeremy Millul, sales manager for New York City–based
Colombian emerald manufacturer Joseph Gad Inc., hails emerald as the most
affordable precious gemstone. While stressing emerald as a great buy, he points
out that prices for sapphire and ruby have
escalated, in some cases tripled, in recent years, particularly for
ruby.
Emerald dealer Arthur Groom, president of Eternity Natural
Emeralds, Ridgewood, New Jersey, advises U.S. jewelers to take a good look at
emerald as a profit-maker. “Retailers can make a lot of money selling emeralds.
Unlike diamonds, you cannot price-shop emeralds. Each gem is unique. There is
tremendous opportunity for jewelers to offer a gem of great value on which they
can actually make a decent margin.”
Stuart Robertson, market
analyst for The GemGuide pricing reference published by Gemworld
International in Glenview, Illinois, says the range of green color seen in
emeralds is popular with consumers. Attributed to traces of chromium or
vanadium, the gemstone’s distinctive color varies in shades from light to dark,
and is sometimes a cool blue-green or warm yellowish green. The more vivid the
green is, the more valuable the emerald. Because of the conditions under which
emerald is formed, tiny cracks and cavities in the gemstone are common, making
inclusions acceptable even in top-quality goods. Also impacting value is size, with stones over 2 carats
difficult to find.
Although emerald sales in the U.S. have been improving, the
gem is especially sought after in the Asian markets, which benefit from the
weak U.S. dollar, says Robertson. Groom says his strongest markets are China,
India and Istanbul, where rising consumerism in these markets is fueling the
surge in demand for emeralds.
Diversity of Supply
Colombia has long been lauded as the source for some of the
world’s most beautiful emeralds, stones with large crystal sizes and few
impurities. “The color, luster and brilliance of Colombian emeralds are second
to none,” observes Millul, noting that a high-quality Colombian emerald will
fetch a 10 percent to 20 percent premium over African and Brazilian material of
similar size and clarity. “Emeralds from Colombia have that extra kick that
gives them their beauty, unlike emeralds from anywhere else.”
Colombian emeralds,
especially those from the Muzo mines, have historically commanded the highest
value in the market. Just look at the prices Muzo emeralds have fetched at
auction. At its May 2011 Geneva sale, Sotheby’s set a world auction record
for a tiara, fetching over $12.7 million. The emerald and diamond piece, circa 1900, was set with 11
pear-shaped emeralds totaling more
than 500 carats. At a Christie’s sale in November 2010 in Geneva, a 9.27-carat rectangular emerald sold
for $824,720 — almost $90,000 a carat — well over its high presale estimate of
$591,814.
But fine emeralds are found in many other countries,
including Zambia, Brazil, Zimbabwe, Madagascar, Pakistan, India, Afghanistan
and Russia. Zambia, Zimbabwe and Brazil, in particular, have a good reputation
for fine emeralds in the international trade.
As one of the few
larger-sized color stone mining companies in the trade, Gemfields has
experienced great success with Zambian emeralds. Results for the sale of its
emerald rough at auction in Singapore this July totaled $31.6 million for
740,000 carats from the 1.07 million carats offered for sale. The company
reported a 63 percent increase in rough prices from $26.20 per carat to $42.70 per carat
over the last sale of comparable quality in December 2010.
Ian Harebottle, chief executive officer (CEO) of Gemfields,
based in London, describes the results as “a clear indication of robust growth
in both prices and demand for emeralds in general, and Gemfields ethical
emeralds in particular.” Gemfields has conducted seven auctions since July 2009
totaling $87.5 million in revenues.
Understanding Treatment
When it comes to treatment, “the emphasis today is on
treatments that can be removed and replaced with a product of the client’s
choice,” says Groom, who invented a stable and removable polymer, known as
ExCel, specifically for use in emeralds. According to a report in Gems &
Gemology Summer 1999 issue, emerald fillers should have certain
properties: “hide fissures, flow into the fractures, hold up over time or be
easy to restore and be removable or not have
any physical properties that might later harm the stone. The filler
should also have a refractive index similar to that of the stone being
treated.”
While emeralds don’t have the widespread confidence issues
that have surrounded lead-glass-filled ruby in recent years, they are not
without controversy. Groom cites the continuing problem with the treatment of
emerald rough from Colombia with an enhancement known as Permasafe, which first
surfaced in the late 1990s. Permasafe is used to make the rough stronger so
that more of it is retained during the cutting process. “The reason given by
producers, who typically disclose the process, is that if not for the
enhancement, the rough would not survive the wheel. But isn’t that reason
enough not to do it! As a result of treating rough this way, pure garbage is in
the market under the guise of emerald. Its removal results in the stone falling
apart.”
The trouble, as Groom sees it, is that subsequent levels of
the distribution chain are not disclosing the treatment. “We see it in our lab
in New York. Many dealers don’t know what they’re buying.” To avoid problems,
he says some buyers are boycotting Colombian emeralds, opting for emeralds from
sources like Zambia.
Article from the Rapaport Magazine - September 2011. To subscribe click here.