I receive letters on occasion – some stronger than others – suggesting that GIA should either adopt or change a gemological policy. Although occasionally such suggestions are not very well thought out or represent a particular commercial interest, I have found that some of the best insights come from people who have seriously considered an issue and want to share their ideas with the greater gemological community. Most effective are those that represent a sincere attempt to seek common ground.

The words we use, the attitude we have, and the motivation that drives us are all critical in communicating our message. Often, however, there is a difference between being right and being wise. In effect, wise people aren’t just right – they’re right in the right way. Years ago a very wise gentleman suggested to me that GIA should never do anything for anyone that we wouldn’t do for everyone. It is this type of wisdom that we at GIA use to guide our actions and responses to the suggestions and concerns of our community in service to the public.

Issues of gemological debate often involve disclosure. We have found, however, that what appears “right” to one person may appear wrong to another. The key is balance. To find balance, we must try to seek the solution that is best for the greater good. I’m not talking about compromising truth or facts. Rather, for every gemological policy, we need to be right, but also wise, in our handling of an issue.

One issue that created such debate was our policy back in 1999 of grading high pressure/high temperature (HPHT) annealed diamonds. We really needed to see these diamonds in considerable quantities to develop robust identification criteria that did not then exist, and we could see such quantities only if they came through our grading lab. Also, by grading them in the lab, we were able to indicate that they were HPHT annealed on their reports (and on the diamonds themselves). Our “greater good” goal was to protect the trade and the public by protecting the integrity of all diamonds.

Another issue of considerable concern for the industry is that of corundum treatments, particularly those involving beryllium diffusion. Beginning in 2001, dealers released thousands of Be-diffused sapphires and rubies into the market without disclosing the new treatment or the fact that, in many cases, the color was restricted to a surface-conformal layer. While debate continues over the implications of the various corundum treatments, our primary goal at GIA must be to establish the technical facts of gem identification and to share our results wisely with the gemological community.

Ultimately, the biggest challenge we face at the Institute is using gemological wisdom in establishing policies that affect the trade and the public. Great advice is provided by our Board of Governors and highly experienced staff members, but we also benefit from those in both the trade and even the public realm who take the time to share their insights with us. I appreciate and always consider input that has value – especially when it is delivered in a thoughtful and reasoned way – because the collective wisdom from a multitude of people is so much greater than the insights of any one of us alone.

Reports of weaker-than-expected retail sales and job growth have sent jitters through the diamond market, which is still trying to come to grips with relentlessly rising costs for rough. June’s retail sales showed a slight decline from the year before; July sales were up, but mainly on the strength of clearance sales. The diamond industry, however, has been betting on a great holiday season, so retailers can justify paying the 10% price increases for polished diamonds.

The U.S. Department of Commerce reported that consumer spending in June dropped 0.5%, the biggest decline since September 2001. Most of that decline, however, came in the motor vehicle market. While July’s data showed a slight rebound, economists noted that the increase, 0.7%, was weaker than expected. At the same time, the U.S. Department of Labor reported that job growth in July fell way below expected levels. Bloomberg.com reports that the weak job market, due in part to high oil prices, will cause the U.S. economy to fall well short of the 4.2% growth predicted for 2004.  

Exhibitors at the July 25–28 Jewelers of America Show in New York, as well as industry news sources such as the Rapaport Diamond Report and PolishedPrices.com, indicated that demand at the show was selective and spotty, with buyers reluctant to invest in high-priced inventory. Buying in the diamond centers was also sluggish in the weeks before most of the trade left for August vacations. Now into the latter half of the year, diamond manufacturers and dealers remain gloomy over expectations of dwindling profits, as rough prices move higher and retailers continue to lower prices for polished goods. A number of manufacturers have been moving into heavy pavé looks to counter steep price hikes in 1.5 ct.-plus stones.

To compound the industry’s dilemma, the De Beers Diamond Trading Company announced it will raise prices an average of 5% at the Aug. 16–20 sight. The company has already raised prices twice this year. Despite the increases, DTC prices remain lower than fellow producers Rio Tinto and BHP Billiton.

Nevertheless, many retail jewelers just concluded a generally successful first half. Zale Corp., for example, announced a 4.2% sales increase to $2.3 billion in its fiscal year ending July 31. Finlay Enterprises, the largest operator of leased fine jewelry operations in department stores, reported that sales for the six months ended July 31 increased 5.0% to $376.2 million. Signet Group, which operates Kay Jewelers, reported that U.S. same-store sales rose 6.8% in the second quarter of 2004.

On the downside, though, Tiffany & Co. announced that second-quarter earnings fell by $4.5 million to $36.6 million, despite an 8% increase in sales. The company cited slumping sales in Japan as the chief reason. While same-store sales rose 10% in the U.S., Tiffany reported that the higher cost of purchasing diamonds contributed to a nearly 2% decline in gross margins. The 160-store chain, Crescent Jewelers of Oakland, Cal., filed for Chapter 11 bankruptcy Aug 11 in the U.S. District Court of Northern California. Blue Nile, the online diamond retailer, showed a slight increase in sales during the second quarter of this year, but a decline in earnings: $1.9 million vs. $2.2 million for the same quarter last year. The company said that an income tax charge was responsible for the earnings decline.

An analyst at Bear Stearns, quoted in the Aug. 9 Financial Times of London, said that “the emergence of Wal-Mart and the rise of the Internet are a double whammy for the diamond industry. To the extent that traditional jewelry retailers believe there is no longer sufficient profit in diamonds, many have moved on to other parts of their business.” However, a number of major jewelry chains, including Zales and Kay Jewelers, reported that diamond jewelry sales have actually increased as a percentage of overall sales during the past five years.

MACRO: Chain store sales in the U.S. were running a disappointing 3.1% ahead of last year’s data, according to the International Council of Shopping Centers–UBS Chain Store Sales Index. Store sales took a sharp drop in June and recovered slightly in July after a number of states enacted sales tax holidays.

Russell Shor
Senior Industry Analyst

Quartz is well-known for its attractive and varied inclusions, and specimens with distinctive inclusions can fetch high prices from collectors. However, this demand also encourages the manufacture of fakes and imitations. Brazil is one of the largest producers of quartz specimens with unusual inclusions, and it is also where this contributor encountered some interesting new faked “inclusions” in July 2004.

The first example was seen in the city of Governador Valadares, in the state of Minas Gerais, where a local dealer had a parcel of 19 specimens that he had bought for a high price in nearby Teófilo Otoni. All of the specimens were cut as cabochons and contained naturally occurring inclusions of mica or chlorite near their base. These cabochons also contained very unusual coral-like inclusions, which appeared to grow from the micaceous inclusions (see figure). The branches, which measured up to about 30 mm long and 3 mm thick, occurred both singly and in groups. They varied in color, with green, brown, pink, and yellow examples seen; a few even showed multiple colors. In two specimens, it was apparent that small portions of the “branches” were not completely filled by the colored material.

Two days later, when this contributor visited Teófilo Otoni, the mystery surrounding these cabochons was solved. Several colleagues had numerous examples of this material. They were familiar with the person who was fabricating them, and reported that the “branches” were drilled into the cabochons and then filled with a mineral powder, probably mixed with glue, via a syringe. The filled holes were then covered with small pieces of feldspar and quartz mixed with glue, and sometimes “sealed” with a larger piece of feldspar.

The glue is soft when poked with a sharp needle, and shows yellowish green luminescence to ultraviolet (UV) radiation (stronger to long-wave UV). The unique shape of the inclusions, the sometimes incomplete filling, and especially the presence of glue on the base of the cabochons prove the artificial origin of these inclusions.

This entry was prepared by Jaroslav Hyrsl, a gemologist-mineralogist in Kolin, Czech Republic. For more updates from around the world, read the Gem News International section in each issue of Gems & Gemology. To subscribe to G&G, click here. Or contact Circulation Coordinator Debbie Ortiz, or call toll-free 800-421-7250, ext. 7142, or fax 760-603-4595. Outside the U.S. and Canada, call 760-603-4000, ext. 7142.

Part 1: Calcareous Coral, Rhodochrosite, and Rhodonite
While transparent gems such as ruby and amethyst may be most common, translucent-to-opaque red to purple materials are also frequently seen in the trade. This installment of Insider Gemologist will discuss calcareous coral, rhodochrosite, and rhodonite, while other materials will be covered in the next entry.

Unlike most gems, which are minerals, coral is organic. It is composed of the skeletons of marine animals known as coral polyps. Coral polyps live in colonies, and the gradual deposition of their skeletons creates the coral. There are several thousand species of coral polyps, only a few of which produce the coral that is used as a gem material. Magnification of coral reveals a distinctive wavy fibrous structure, often in mixed light and dark tones, with tiny holes marking the sites the coral polyps once occupied.

Calcareous coral, which is largely calcium carbonate, can be white, pink, orange, orange-red, or red, and light to dark in tone. Its refractive index (RI) range is about 1.49–1.66, and like all carbonates it has a very high birefringence (0.172). The birefringence blink technique is used to estimate that figure. Take a spot reading of the sample on the refractometer and, with the magnifying eyepiece removed, rotate the polarizing filter over the lens. Within the RI range, the spot will blink. Recording the high and low points where the spot blinks will give a good estimation of the birefringence.

Imitation coral exists, but under magnification it lacks the wavy, fibrous structure of the natural material. Glass can also imitate coral. Its RI range, at 1.47–1.70, overlaps coral’s, but since it is amorphous it never shows birefringence blink or a fibrous structure.

Rhodochrosite and rhodonite are two widely used ornamental gems, and they are sometimes confused with each other. Both are colored by manganese, so their spectra will not distinguish them. However, they are actually fairly easy to identify, often by appearance alone.

Like calcareous coral, rhodochrosite is a carbonate, so it too shows a birefringence blink can also be seen with a refractometer. The gem’s RI range is about 1.60–1.80, although a spot reading of around 1.60 is typical.

Rhodochrosite is found in both single-crystal and aggregate forms. The rare single-crystal material may be transparent-to-opaque pink, red, light brownish red, or orangy pink. It can show distinctive cleavage planes. Most of the gem rhodochrosite seen in the marketplace is fashioned from the aggregate form and is opaque; usually, it  has pink and white agate-like banding that gives it an instantly recognizable “bacon strip” appearance.

Rhodonite does not have this characteristic banding. Typically it is translucent-to-opaque pink, red, or brownish red to purplish red, and it can show blotches or veins of black manganese oxide. Rhodonite is harder than rhodochrosite (though both are fairly soft) and often shows a better polish. Transparent single-crystal rhodonite exists but is rare; faceted examples are even rarer due to the gem material's two perfect cleavages.

Rhodonite usually gives a spot reading of 1.73–1.74, though some areas on a cabochon might show a 1.54 reading if there are quartz impurities present. If this result occurs, try taking a reading on another area.

Coral, rhodochrosite, and single-crystal rhodonite have fair to poor toughness and stability, so all should be treated with care.

GIA’s Gem Identification course provides professional instruction in identifying characteristics of the trade's most common translucent-to-opaque red, pink, and purple gems. Click here to learn more about this course and other gemological courses and diploma programs.

The gem and jewelry industry’s top leaders recently attended GIA’s International Executive Council meeting in New York City, where President William E. Boyajian briefed them on the state of the Institute, and officials from the Laboratory shed light on the upcoming cut grading system.

The annual meeting is designed to encourage dialogue between members of the industry and the Institute, which helps GIA executives determine how to modify or improve the services it provides.

Boyajian opened the July 26 meeting by saying 2003 had been the Institute’s best year ever due to stellar progress in each of its major divisions. The Laboratory continues to lead the way; the unprecedented demand for its services has brought about expansion at its New York and Carlsbad locations. The Education department broke its own record, with GIA Distance Education completion rates among the highest in the United States, he said.

The increased demand for GIA Education has spurred moves to larger facilities on both the East and West coasts. The New York education center recently moved to Madison Avenue and 39^th Street, with double the space, and GIA Los Angeles transferred to a much larger branch in Culver City, Boyajian said.

“We’ve also just opened GIA India in Mumbai, where the industry is growing at a tremendous rate,” he added. “And we’re looking into expanding GIA London, since demand for our Graduate Gemologist program there is extremely high.”

The Development and GIA Instruments departments have also shown marked increases in productivity over the last year, and Research continues its work to stay ahead of industry challenges, he said. GIA researchers are working on advances in cultured pearl treatment detection and grading, as well as the rollout of the round brilliant cut grading system, which GIA hopes to introduce by mid-2005 on all its Diamond Grading and Diamond Dossier Reports.

“We really believe our role is to establish standards that can be reproduced in the industry,” Boyajian said.

Preliminary details of the new cut grading system were provided by Thomas C. Yonelunas, CEO of the GIA Gem Laboratory, and Thomas M. Moses, vice president of Identification and Research Services.

The proposed cut grading system for round brilliant diamonds is the culmination of years of research, during which diamond cut appearance aspects such as brilliance, fire, and scintillation were analyzed through computer modeling and observation testing. The system also takes into consideration aspects such as the weight and durability of a diamond (e.g., overweight diamonds and those with extremely thin girdles), and the craftsmanship of the finishing process as seen in a diamond’s polish and symmetry. The system was validated and fine-tuned by more than 70,000 human observations, Yonelunas said.

In its research, GIA discovered that every facet in a round brilliant contributes to the overall appearance of a diamond and that historically recognized proportion sets used for “ideal cut” diamonds are just some of the many sets of proportions that can produce pleasing diamonds, Moses said.

“It’s really the interrelationship of the proportions that is important. From a manufacturing standpoint, this provides diamond cutters with much more flexibility,” he said.

The cut grade for round brilliants submitted to the GIA Gem Laboratory will be based on a three-part quality system that focuses on face-up appearance, weight and durability, and craftsmanship, Moses explained. The exact nomenclature that will be used has not yet been determined.

A graphic illustrating the interrelated properties of the round brilliant, including expanded proportion information, will be included on the reports, as will text that clearly explains the Four Cs.

A few attendees voiced their concerns about the grading system’s immediate impact on the industry, particularly at the retail level. However, most agreed that the new system is a big step forward.

“I believe the customer deserves this information,” said Lee Michael Berg, president of Lee Michaels Fine Jewelry. “This will allow us to be on the same playing field, where everything will be disclosed. Now the consumer will get 100 percent of the information rather than 80 percent, as we’ve done for years.”

The meeting was followed by a cocktail reception held in the Rose Room of The Plaza Hotel, where guests enjoyed refreshments and hors d’oeuvres.

GIA will make two presentations at the International Jewellery London 2004 Show, Sept. 5–8, and GIA London will welcome attendees at booth No. G26.

Wendi Mayerson, staff gemologist in the Identification and Research department at the GIA Gem Laboratory New York, will provide an update on GIA’s research on synthetic diamonds on Sunday, Sept. 5, from 2:30 to 3:15 p.m. On Tuesday, Sept. 7, Mayerson will discuss gem identification highlights from the laboratory, from 1 to 1:45 p.m.

Ongoing developments and the application of new technology in the manufacturing and marketing of gem-quality synthetic diamonds have raised concerns throughout the industry regarding identification and proper disclosure of the material. For more than 50 years, GIA has been at the forefront of researching synthetic diamonds and has published extensively on this topic.

Today, treated, synthetic, and imitation colored stones are more prevalent than ever. Proper identification is important in maintaining confidence in the value of these items and is a growing legal concern as well. In her discussion, Mayerson will describe some of the techniques and instruments the GIA Gem Laboratory has employed to identify several unusual and interesting examples. These techniques are important for anyone in the trade responsible for buying, selling, or identifying gemstones. 

Information on the International Jewellery London 2004 Show and how to register is available by clicking here.

For further information about GIA London, visit GIA London, e-mail, or call 020 7813 4321. The branch is located at 99 Great Russell St., London, WC1B.