Gem Cents: What Determines the Value of Colored Gems (2024)

As many of you know, I’ve spent over 30 years in the jewelry industry as a colored gemstone dealer and designer.

Working as a dealer who supplied high-end jewelers and collectors for decades led me to understand the nuances of the international gemstone market, including pricing.

Clients have questions on how prices are established in colored gemstones. Below, I give you the simplest, clearest and most accurate answer I can. If you prefer to video over print, watchhere

Supply and Demand in Colored Gemstones 101

Colored gems, with their electrifying and pulsing colors, are no summer romance; they are a study in nuance. And, true rarity.

With diamonds, certainly, until the last decade, centralized mining cartels determined the supply available over a certain time period while stimulating demand through marketing campaigns, such as“a diamond is forever,”or“the right-hand ring.”

Their market is highly orchestrated and actual output is controlled, much like OPEC handledoil.

The colored gem market rocks the casbah.Like an undammed river, it is beautifully erratic and flows reflecting how much of a particular gem is available at any moment and how many people want it.

Without an organization controlling output, colored gemprices are an actual reflection of supply and demand.

All over the world, gem finds can quickly spring up, then play out.

Each of the 20 to 40 varieties of colored gems you’llfind in jewelry has its own market dynamic, sometimes even subdivided based on country of origin, as the price differences between Colombian and Brazilian emeralds.

The thing that makes colored gems so intriguing is one of the things that save them from being commoditized:Color.

These gems don’t just have “a” color.They have secondary and tertiary hues, masked with tones of grey or brown, all with intensities ranging from docile baby blanket pink to blatant baboon-butt fuchsia.

This color trilogy can be further complicated if the gem sports an optical phenomena such as a star or cat’s-eye.

Colored gems’ nuances have so fardefied the easy categorization that is necessary to construct the color/size/quality/price grid necessary for trading commodities.

A large fine ruby may cost more than a diamond, but the world market for diamond is light years larger. Colored gems are too complicated a business to attract a large organizing cartel.

Rhodolite is one of the reddish varieties of garnet that is popular in jewelry. If somebody wanted to corner the rhodolite market, they’d have to negotiate agreements with miners working areas in East Africa, Madagascar, India, Sri Lanka, China, and Brazil, for starts.

It’s not just one mine in each of these countries; more often, there are clusters of many small operations mining the gems in each geographic area.

Attempting to master this geographic and cultural diversity, with all the different mores, motives, and creative cheating, for a gem that mostly sells for $10-200/carat isn’t just futile, but probably feudal.

It would be impossible, like a never-ending game of Whack a Mole– hammer a solution to one problem, and others pop up, ad infinitum.

Colored gem supplies go up and down, depending on politics, the economy or geology.

A government can shut down or take over a mine – during economic downturns, there isn’t as much demand, so mines close – or, geology takes over, and a gem find is played out – there is no more.

Likewise, the supply can be affected by high demand – a gem is so popular the supply becomes limited, which raises the price – too many people chasing too few gems…..

Mostlya gem has to be desirable to bevaluable, and several factors play into a gem’s desirability: beauty,rarity, durability, color, size, clarity, and cut.

Let me touch on some of those aspects:

Beauty.

If a gem is not beautiful, few people will desire it.

Rarity.

We may be drawn by a gem’s beauty, but it is rarity that gives a gem its exclusivity. “Rock crystal” quartz is beautifulbut it’s not rare, so its price is not so high. Tsavorite garnet (above) is a rare gem found only in the Kenya/Tanzania borderland.

Clarity.

Some gems are acceptable with some internal inclusions, such as emerald and red/pink tourmaline. Others, such as aquamarine,come readily without inclusions, so if anaquamarine is included, it should be substantially lower per carat than an equivalent eye-clean aquamarine.

Other gems fall in the middle, and were mainly concerned with the placement of the inclusions, and whether they would be a structural defect that would affect durability and wearability.

A perfectly placed “horsetail” inclusion, above, in a rare green Demantoid Garnet is actually very desirable as it shows the gem is from the fabled provenance of Russia.

Color.

Though color preferences are personal there are, nevertheless, prices that correspond to particular colors.

What may appear to the layperson to be subtle color differences can be translated into significant monetary differences.

Size.

A 3-carat ruby is much rarer than an equivalent quality 1-carat ruby and would be many magnitudes the per carat price.

Conversely, sometimes a gem is too large to be usable in the jewelry market, such as a 100-carat aquamarine of average color – that would fetch a lower price per carat than an equivalent quality gem of 10-carats as there are fewer uses for a 100-carat gem in jewelry.

Durability.

The gem may be beautiful, rare, intensely colored, the right size and well cut, but if it isn’t durable, it won’t endure to be passed down the ages as a jewel.

Provenance.

Withcolor gems,provenance refers to thecountry or mine the gem is from and thiscan affect desirability, such as sapphires from the fabled Kashmir area of India (see the ring tothe right) or rubies from Burma or the electric neon tourmaline that is really from Paraiba, Brazil (not Mozambique).

The interplay of all the aboveattributes determines the demandfor a gem or its desirability. And,this interplayofcharacteristics
is different for every gem.

Do you know the beautiful gem, red spinel?

It’s a gorgeous gem – a favorite of most gem dealersbecause of its great beauty and rarity. Prior to 2007, gem dealers could afford to keep a few from their inventory for themselves or their family. It’s price at that time, did not reflect it’s rarity and beauty.

Though red spinel is beautiful and rare, it wasn’t well known- its supply was short (it was only found in Burma), and its demand was low because it wasn’t well known to the public, so it was a hard sell for the jeweler.

Spinel has been around a long time and itwasoften confused in antiquity as a ruby because of its red color.Spinel also seen misnamed in a lot of crown jewels as ruby – the “Black Prince’s Ruby” in the crown jewels of GreatBritainis really a ruby.

Before the Mahenge find, I had a top top top 5 carat Burmese Red Spinel that I sold to a collector in 2001 for $2000/carat – the top price then.I saw the same gem in Tucson eight years later at $10,000/carat. Currently, red spinel prices go up from there.

Your Next Step?Contact Cynthiatostart yourjewelry project,whether a new creation or totransformyour unworn jewels into a new favorite.

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