Why Do Diamonds Cost So Much?
BY AWAKE! CORRESPONDENT IN SPAIN
SOMETIMES beauty can be discovered. Other times it must be created. A diamond, however, must be both discovered and created.
Rough diamonds are, without doubt, a beautiful creation of nature. Intense pressure and high temperatures under the earth’s crust slowly mold simple carbon into hard, translucent crystals. But these rare stones often defy discovery. Some of the largest man-made holes on earth—dotting Australian, Siberian, and South African landscapes—have been dug in the search for these precious stones. To retrieve a few diamonds that weigh merely one fifth of an ounce, one hundred tons of earth may have to be mined and sifted!
Once a diamond is discovered, skilled craftsmen must painstakingly sculpture its latent beauty before it can grace a ring or a necklace.
Naturally, all this effort and expertise does not come cheap. But most women—and men—feel the expense is worthwhile, especially if the diamond is a gift presented to a spouse or a fiancée as a token of lasting affection. Beauty and romance have made the diamond the most prized crystal on earth.*
A Visit to Antwerp
On a visit to Antwerp, Belgium, a city whose wealth largely depends on diamonds, my interest in these unique stones was aroused. ‘What,’ I wondered, ‘makes a diamond so appealing? What is the secret behind the making of a diamond?’
To answer those questions, I spoke to Dirk Loots, whose family has worked in the diamond trade for three generations. “We call Antwerp a diamond’s best friend,” he explained, “since this city is one of the world’s main diamond centers. So you’ve come to an ideal place to discover the secrets of the diamond maker.”
First of all, he showed me a handful of rough diamonds that he had just bought. Although they were valued at $350,000, they didn’t look that impressive at first sight—more like a handful of glass chips. But a closer look revealed an inner brilliance that betrayed the beauty that the diamond cutter could unlock. I began to understand their appeal.
“Occasionally when I see a large rough diamond, I sense a certain magic, almost like an emotional attachment,” Dirk confessed. “Instinctively, I want to buy that stone. It reminds me of Jesus’ illustration of the man who found a magnificent pearl, a pearl so perfect that he was prepared to sell everything he had in order to buy it. I’ve never gone that far,” he smiled, “but I must admit that some fine stones exert a special attraction, even for those of us who spend our lives buying and selling them. Of course, making a gem out of a rough stone, however impressive it may be, is not without its pitfalls.”
Smoothing Out a Rough Diamond
I had heard that a priceless stone could be shattered by a careless diamond cutter. I wondered if that happened often. “It is not that rare an occurrence,” Dirk admitted. “And this can happen not only when the stone is being cleaved. Even the diamond polisher can occasionally touch a gletz, or internal imperfection, and ruin the stone. We always carefully examine the rough stone through polarized light, which shows up problem areas; but no system is foolproof, I’m afraid.
“Although a shattered stone is our worst nightmare, that is not the only difficulty. Sometimes the color of the stone gets darker after cutting and polishing the facets, and its value diminishes. And you must remember that we often have to cut away 60 percent or more of the rough stone in order to make it into a first-class gem.”
That seemed to me like a lot of money going to waste, until I grasped all that is involved in the making of a diamond. Dirk showed me a huge heart-shaped diamond that had just been cut and polished. “Do you see how it sparkles?” he asked me. “That ‘fire’ inside the stone is really nothing more than reflected light.
“What the craftsman has to do is cut all the facets in such a way that the light is trapped inside the stone and then reflected back toward the observer. Some traditional shapes, such as the round cut, do this in the most efficient way. But even fancy designs, such as this heart-shaped one, aim to reflect the greatest possible amount of light. That is the essential art of the diamond maker. In fact, one well-known diamond manufacturer has chosen as his motto, ‘The magic is in the make.’”
“How do you decide which shape to cut the diamond?” I asked Dirk. “We start out by looking very carefully at the original stone that we buy,” he said. “And I mean carefully! I remember one large stone that we examined for a month before making the final decision on how it should be cut. Sometimes it is easier because the rough stone lends itself to being cut into a certain shape. In each case the aim is to determine the best shape for that particular stone so that we lose the least possible amount. But every facet we cut—and a typical diamond has more than 50 facets—means a loss in weight.”
Dirk then asked me to look carefully at a certain stone. “Do you see the impurity up there on the right of the stone?” he asked, handing me a loupe, a jeweler’s magnifying glass. I saw a few jagged lines, like those in a cracked mirror, inside one corner of the gem. “That sort of imperfection greatly reduces the value of the diamond. We could cut it out, of course, but that may mean losing too much of the stone. If the flaw is not noticeable to the naked eye, we can still sell the stone for a lower price.”
I was interested to know why such tiny stones are so valuable. Clearly, there are several factors involved.
“The cliché ‘a diamond is forever’—although an advertising slogan—is generally true,” Dirk said. “Diamonds don’t wear out, and their glitter doesn’t fade. They are rare, although not as rare as they used to be, and they are beautiful—no doubt about that! But perhaps the most important factor that determines their value is the worldwide demand for diamonds. This depends largely on advertising.
“Why does a woman want a diamond ring?” Dirk mused. “She probably connects diamonds with love and romance. A diamond is something special, something to be eternally treasured, to remind her of a love that hopefully will last as long as the diamond. This idea, or mystique, as some would call it, has been skillfully cultivated. Some $180,000,000 was spent in 1995 to market this message, a message that keeps people the world over buying diamonds.”
The Value of a Diamond
“I suppose that the value of the finished gem depends on its size,” I remarked. “It’s not quite as simple as that,” Dirk replied. “Diamond traders are wont to say that the value of the diamond depends on four factors: cut, carat, color, and clarity. Each one has a bearing on the beauty—and hence the value—of the stone.
“Let’s start with the cut. A good cut is a work of art, a sculpture in miniature, you could say. Take a closer look at that heart-shaped diamond you were admiring. The shape is not an easy one to manufacture, and it is one that requires sacrificing more of the original stone than other shapes. Notice how all the facets have been positioned symmetrically to enhance the beauty of the gem. We would say that this particular diamond has a very fine cut.
“You were first impressed by its size, and understandably so, since it is a large, 8-carat stone. One carat is equivalent to two tenths of a gram, by the way, so we determine the carat value simply by weighing the stone. Generally speaking, more carats mean a more valuable diamond, but its value will also be affected by color and clarity.
“Diamonds come in all shapes and colors, as you will have noticed from our packet of rough stones. The first thing we do is sort them according to color, the whiter ones being the more valuable. Although, there are a few stones that have what we call fancy colors, such as pink, blue, or red; and these fetch higher prices than the white stones do, since they are extremely rare.
“Finally, we have to grade a stone by its clarity. If a stone is classified as flawless, it means that when you look into the stone—even with a loupe—you will not see any imperfections. Thus, a diamond’s cut, clarity, and color can be just as important as its weight in carats. To give you an example, in 1995, what may be the largest diamond ever polished (546.67 carats) was put on display. But despite its size—nearly that of a golf ball—this is not the world’s most valuable diamond, because of its inferior clarity and its yellow-brown color.”
Before leaving Antwerp, I spoke to Hans Wins, who has been involved in the diamond industry for 50 years. I wanted to ask one last question, What makes a diamond so special?
“I don’t find the small stones so exciting—they can even be fashioned on a machine,” he replied. “But large diamonds fascinate me. Every stone is different—a unique creation squeezed out of carbon by millions of years of volcanic pressure. When you study the stone, you can actually see the growth lines, somewhat like those in the trunk of a tree. An experienced dealer can even tell you which mine it came from.
“A diamond manufacturer looks at such a stone the way a sculptor looks at a block of marble. He already sees in his mind’s eye what he can create. In his imagination, he is cutting and polishing and a magnificent gem is emerging. I like to think that when the diamond finds its final setting in a ring or a necklace, it will give that same pleasure to its owner.”
When all is said and done, that is why it is worthwhile to make a diamond.
A major reason for the high price of diamonds is control by a monopoly, the Central Selling Organization.
[Pictures on page 15]
Heart-shaped diamond of 8 carats (stones not to scale)
“Cardinal’s hat” cut
Determining the carat weight of uncut stones
Sorting rough diamonds according to color
Examining facets to determine if more polishing is needed