Flawless white or “colorless” diamonds may be the most sought after when it comes to engagement rings, but colored or “fancy” diamonds are far more rare and can be hugely more valuable, writes Sonia Kolessnikov-Jessop in her article published by the New York Times. Where a one-carat white diamond may cost from $3,000 to $10,000, a pink, red or blue diamond of the same weight can easily sell for more than $1 million.
In November, Laurence Graff, the London-based international jeweler, paid a record $46.1 million at Sotheby’s Geneva for a ring featuring a 24.78-carat fancy intense pink diamond, equivalent to $1.86 million a carat. The record price for a blue diamond at auction, $1.4 million per carat, is held by the Bulgari Blue, which sold in October at Christie’s in New York to an Asian buyer for $15.7 million.
The top price for a red diamond was hit in November 2007 with a 2.26-carat fancy purplish-red diamond ring at Christie’s Geneva, which sold for the equivalent of $1.18 million a carat.
Even relatively common yellow diamonds can outsell most whites. The top price per carat for a fancy vivid yellow diamond was achieved by a 13.83-carat marquise diamond, the Burden Yellow, which sold at Sotheby’s New York in 1997 for $3.3 million, or $238,612 per carat.
Although colored diamonds are extremely rare, the jeweler Lev Leviev has built a name selling some of the biggest in the world since opening his first Leviev store, in London, in 2006. Quickly adding three other stores — in New York, Moscow and Dubai — Mr. Leviev, who controls some of the largest private diamond mines in the world, then turned his eye to the fast-growing Asian market, opening a store in Singapore last year.
Putting the store in the hotel lobby of the Marina Bay Sands, Leviev is targeting international clients, of course, but in particular the wealthy Asians drawn to the hotel’s casino.
Asian clients, particularly the Chinese, have become an important force in the market, both for jewelry stores and in the auction rooms, where they bid enthusiastically for high-grade gemstones and jewelry, especially pieces featuring colored and large colorless diamonds.
Even if they do not always win, Chinese bidders have become regular contenders for the top diamond lots, said Rahul Kadakia, head of the jewelry department at Christie’s New York, “and they’re doing this in a very focused and educated manner.”
“The Chinese like impressive stones and they’re looking for perfection,” he said by telephone. “You can show them a 100-carat yellow diamond that has some imperfection in purity or a 20-carat supervivid yellow flawless diamond. They’ll go for the flawless diamond. They want to buy the best, and they’re very savvy. They have educated themselves sale by sale, and they’re buying very well.”
Still, if vividly colored diamonds appeal to Asian tastes, the colorless whites are by no means neglected. Demand for diamonds in China rose 25 percent last year from a year earlier, according to the diamond producer De Beers, which last month announced an after-tax profit of more than $600 million for 2010, after a loss of more than $30 million in 2009, buoyed by a recovery in diamond prices and strong demand from India and China.
China is now the second-largest market for diamonds, after the United States, and it is likely to surpass the United States as the biggest diamond market in the world in the next decade, according to De Beers.
Recognizing this growing demand for glittering jewels, several high-end jewelry companies are aggressively expanding in China.
Van Cleef & Arpels added two outlets there last year, bringing its total to six. Laura Lai, the general manager for Van Cleef & Arpels’s in China, said in an e-mail that two more stores were planned for the summer.
Tiffany & Co. has announced a major focus in China, with plans to double its stores in the country to 30 in four to five years.
In October, Tiffany announced its 2011 jewels and diamonds collections in Beijing, the first time the brand had offered a major new collection outside of its U.S. home market.
François Delage, chief executive of De Beers Diamond Jewellers, a retailing joint venture with the French luxury goods company LVMH Moët Hennessy Louis Vuitton, said in an e-mail that mainland Chinese clients were already regular clients in the company’s stores in the region, as well as in Paris and London, favoring high-quality designs and settings.
“We are planning to launch in China in 2011,” he said, “and to open stores selectively in key Chinese cities after a first opening that we want in Beijing.”
In the Leviev store in Singapore, a radiant-cut, fancy vivid yellow-green diamond, weighing 2.96 carats and mounted with two emerald-cut fancy intense purplish-pink diamonds, is on display with a price tag of 4.86 million Singapore dollars, or $3.8 million, while a 1.98-carat orange diamond is on offer for 4.78 million dollars.
A platinum ring set with a radiant-cut, fancy red diamond weighing in at 1.16 carats, surrounded by eight petal-shaped white diamonds totaling 8.53 carats, is priced at 5.36 million dollars.
With starting prices for smaller pieces set in the 300,000 to 500,000 dollar range, this is not a store where customers have to fight their way through the bargain-hunting hordes. But it is not just a showcase, either. Billon Loo, senior sales executive at the store, said he had received a “very serious inquiry” from a Malaysian client about a huge, light-pink diamond necklace mounted with multicolored diamonds, priced at 29.7 million dollars.
On April 6, Sotheby’s Hong Kong plans to auction a pear-shaped, fancy pink diamond ring that, excluding its clear diamonds, weighs 12.72 carats and carries an estimate of $3.2 million to $4.1 million. Also on auction will be an extremely rare 1.92-carat fancy VS2 red diamond ring, estimated at $2.5 million to $3 million, or about $1.3 million per carat.
Red diamonds of such size and clarity are extremely rare, and the auction house purposely chose to present it in Hong Kong because the auctioneers believed its auspicious red color would attract significant Chinese buyers, said Quek Chin Yeow, head of the jewelry department at Sotheby’s Hong Kong.
“Asian buyers are quite picky about clarity and prefer the highest clarity,” he said. “They also like big stones.”
While mainland Chinese buyers accounted for about 2 percent of sales at jewelry auctions in Hong Kong three years ago, Mr. Quek said they now account for more than 20 percent of sales. “And I’m sure other auction houses will have seen a similar pattern,” he added. He said Sotheby’s expected the trend to continue and the share of Chinese buyers to rise “a fair bit.”“Most of our clients are now looking to offer their stones in Hong Kong, because that’s where the buyers are,” Mr. Quek said, “and the window of opportunity is slightly larger than in Geneva, because here we will bring the diamond around the region in previews.”
