Blue and Yellow Diamonds Blue and Yellow Diamonds Yuri

The Gemological Center of the Moscow State University dating back to 1995 has a high standing inside this country and abroad. It is engaged in training professionals specialized in diamonds, colored gems, jewellery adornments, diagnostics, expert examination, appraisal and market problems. Among those working at the Gemological Center there are lecturers and research fellows of the MSU, scientists and experienced experts in gemology.
The Gemological Center is involved in such important activities as expert examination of precious stones and jewellery, gemological research, developing new techniques and equipment for gems processing and information and consulting services.
Our interlocutor is Yuri Shelementyev, Candidate of Geological and Mineralogical Sciences, Chief of Expert Examination Department of the MSU Gemological Center.

- Why may two similarly looking diamonds greatly differ in their price?

- There are several reasons. In the first place, a slightly longer stone diameter is indistinguishable to the eye. However, the price will go up in this case and sometimes by leaps and bounds. For instance, a stone with a diameter of 6.3 mm may weigh 0.99 ct and be priced at $5000, while a similar stone with a diameter of 6.4 mm may weigh 1.04 ct and be priced at $6500. The difference in diameters of 0.1 mm results in the price difference of $1500. A one-point change in color or purity group leads to an average change of 10% in diamond price. If in our case, the first stone ratings were 5/6, its price would be $5000 and if the second stone ratings were 4/5, it would be priced as much as $8200. In actual work, stones seating side-by-side may more differ in their ratings bringing the price difference to 4-5 times. Mind, that we are discussing only those characteristics, which consumers cannot detect "by sight", in other words the stones will look similar.

- There is the Rapaport Price List and the Russian Price List for diamonds. To which extent do real prices for diamonds correspond to these price lists?

- Conceptually, these price lists should operate at the wholesale level, that is when dealers sell diamond lots to each other. On the whole, the Russian Price List gives lower quotes, although the Russian system of diamond evaluation is stricter than the international system. However, the market does not use the Russian Price List. When a diamond is sold on a retail level its price is higher and includes taxes, certification expenses and the dealer's profit. Diamond cutting factories are disposed to skew the ratings upward a bit and after certification, the stone will be valued according to another line of the price list. This is why certified diamonds are more expensive than those uncertified. At the "Diamond World" Portal, we have placed a price calculator, which reflects our opinion of diamond retail prices in Russia delivering not just one price value but a whole range of them.

- In what way does cutting quality influence the price?

- Cutting quality has a great influence on the price, making a double price gap between well and badly cut stones, all other things being equal. If in our case we shall put down the price of the first stone by 20% due to bad cutting quality and put up the price of the second stone by 20% due to good cutting quality, they will be valued at $4000 and $9800 respectively.

- What is the price difference between unmounted diamonds and mounted diamonds?

- If we take the market of mounted diamonds, the prices will go upwards and the price range will increase. Calculating their prices, trade companies take into account the cost of goods, trying to include all their expenses and their profit rate. You will be lucky if they manage to increase the price by 70% only, taxes included, as compared to the price of unmounted diamonds. Goods imported to Russia go up in their price heavily, because one has to add 20% of customs dues to the contract price and then 18% of VAT charged from the aggregate amount. Price formation at brand boutiques is a separate thing for discussion. The expenses involved in creating a brand are usually very high and this is reflected in prices for all goods sold under this brand. However, the bets are placed on brand-addict buyers guided by emotions and not by their reason. The middle class people are usually afraid to overpay, they wait to compare and calculate. The rich are ready to pay more and they buy a way of life, not a diamond article as it is.

- The diamonds cut in Russia are closer to diamond deposits than those cut in India, Belgium or Israel. Why are they more expensive?

- We evaluate diamonds from 1995. We have seen many stones bought abroad. I cannot say that every stone there is bad. However, taken on the average, their cutting is bad and their ratings are overestimated. After re-evaluation, their price goes down and becomes lower than in Russia, while their cutting quality is worse. We come across stones with treated cracks, a thing so far never done in Russia. Of course, in the world market there is a "premium" segment, where cutting quality is good, even better than in Russia. However, consumers have to pay for this cutting quality more money. The tales about wonderful and cheap diamonds overseas are a myth. In any market, you may come across different goods. Even in the food market there may be different prices for the same goods fluctuating from one seller to another. If a buyer is well versed in consumer qualities of foodstuffs, apples for instance, he or she may poll several sellers and find the best price-and-quality ratio to his or her mind. What if a buyer is not expert in diamonds, how can he or she make the best choice?

- What diamonds are popular in Russia?

- Russia is now socially stratified and there are different consumer groups here. The richest Russians (according to mass media reports, only Moscow accounts for 80 000 U.S.- dollar-millionaires) are buying a way of life, not diamonds. They need the best from world-famous brands and the price is of no significance. The middle class consumers are buying medium diamonds and I like these people better, since they are more apt to find out more about diamonds before they buy them. Their choice is the best price-and-quality ratio. There are many items with small diamonds for people with low purchasing capacity, the retail prices running from 5000 to 10000 roubles. In terms of quantity, such items prevail. Nobody is ready to buy diamonds if it turns out that the stones have great defects; the word "defects" is bearing a negative meaning and frightens. Fantasy colour diamonds are popular, and may be the most popular of them are yellow diamonds. Brown diamonds made their appearance in the market, they are called "cognac diamonds" and I believe that fashion for these stones will grow.

- Is there any demand for unmounted diamonds?

- Such a commodity as unmounted diamonds in Russia is already 10 years old. At first, people just did not understand what and why this product was, they could not figure out whether they should buy it and what they would do with it. Now they know. From my point of view, they buy unmounted diamonds not so much for investment purposes as for further mounting. It dawned upon them that it was a cheaper way. In Yakutia, they buy certain diamonds weighing from 0.01 to 0.02 carats. To my mind, the unmounted diamonds market is growing by 25% - 30% in a year. However, the diamond illiteracy level is so far great. Many people fear that jewellers may replace their stones. Many feel at a loss about diamond ratings. Diamond merchants have not much knowledge. They are obliged to assist in making one's choice but actually cannot answer simple questions. Finally, the absence of promotion strategy, like the long-term strategy of De Beers, is the main thing holding back the domestic market.

- What is important to look after, when choosing and buying diamonds?

- There are three things important for consumers: genuineness, quality and beauty. Before you buy, take care to be sure that your diamond is genuine, that its quality ratings furnished by the seller are correct and meet you demand. It would be wise to compare several stones and to select only those, which you really like. The most expensive or the largest stone is not always the one, which you like, since people differ as well as their tastes and favours. Even eyesight properties of many people differ. Thus, it is important to have a merchant specialized in diamonds, who can help you to make the right choice. If the buyer is not a diamond expert, then obtaining a third-party document certifying the stone is not a superfluous warranty.

- Why do Russian diamond cutters sell small quantities of diamonds in the domestic market?

- Business patterns in Russian diamond cutting were established when demand in Russia was miserable. People could not afford luxury items and diamond cutters got used to wholesale export. Their foreign partners have ready distribution channels. In Russia, although its people's well-being is growing and many areas of life face consumption boom, there is no one to align diamond selling channels. Just look, there are cities with a population of one million, where people buy real estate, foreign cars and make other expensive purchases, but they have no opportunity to buy diamonds. A certain part of cutting factories switched over to the domestic market, but many of them ran into a problem of setting up a diamond market. However, to cut diamonds and to create their market requires entirely different skills.

- What can be advised to those who want to sell diamonds in Russia?

- Those in Russia who sell ready-made jewellery with diamonds already feel themselves well and assured. These are not only premiere foreign brands. These are also home manufacturers and importers of mass products. In Russia, diamonds either can be sold to jewellers or to end-users and it is better to sell them to both. Jewellers may be attracted by diamond cutting quality, ratings, product range and support. Those who are going to sell diamonds to end-users may be recommended to resort to available jewellery distribution channels as well as to e-commerce. Sellers will need a clever promotion strategy just because diamonds in consumers' minds compete with other luxury products. These luxury products are very well promoted in the market. If you will not promote your diamonds, they will succumb to competition and then a young man making a marriage offer to his girl will give her a mobile phone as an engagement gift.

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Source: https://www.rough-polished.com/en/exclusive/13480.html

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