Donald Trump was the opening keynote speaker at the Couture Conference, and, to the delight of the audience, he was engaging and entertaining. Not only was he frank about some of his personal and professional achievements and failures, but he also shared a list of the key elements he has found critical to success in business. Coming from a man who has been enormously successful – and has “branded” himself and his business well – some of his main points are worth repeating here.

They were:

• Love what you do
• Dream and think BIG
• Stay focused
• Don’t lose your momentum
• Go against the tide – and go with your “gut”
• Get the best people – but watch them
• Be lucky – the harder you work, the luckier you are
• Get even

While I think most of us can endorse the majority of his points, the idea of having to watch over our best people (presumably because we can’t trust them), as well as the recommendation that we get even with people if they turn on us, are a bit “over the top” for many of us. The truth is, when you have the best people – and if you are good to them – you don’t need to watch your back. Nor should you become fixated on getting even with employees or colleagues who join opposing camps, even if you feel they merit it. I believe we should vigorously defend ourselves when we are attacked, but we should not retaliate against those who attack us. Most of the other elements he cites – love of one’s job, thinking big, staying focused, maintaining momentum, hiring the best people, and getting lucky – are much more likely to bring success if we focus on the positive aspects of the industry we work in and the people we work with.

Donald Trump on “success” was interesting and invigorating, if not always agreeable. But I guess that’s why he’s Donald Trump – a phenomenon in American business and among business professionals everywhere.

The dominant theme of the diamond events held in New York during mid-October was that many in the industry are fighting to keep pace with consolidation, technological advances, competition from synthetics, and challenges to retain consumer confidence.  

A number of the world’s top diamond people – speaking at the Rapaport Diamond Conference, the Couture Diamond Leadership Conference, and the World Diamond Congress – described the vast, rapid changes that are gripping the industry.

Maurice Tempelsman, chairman of Lazare Kaplan International, delivered several addresses to the various events. In each, he told the audiences of diamond dealers and retailers that sweeping changes carry a great deal of risk. Diamond prices will become more volatile now that the De Beers Diamond Trading Company (DTC) is no longer regulating the market.

“This new system [of freer markets and prices] has not been tested by a major recession. Where supply exceeds demand, prices drop. Inventory values are lowered. There’s a risk in that,” he told the audience at Couture.

Tempelsman stressed that the “informed consumer is today’s reality in the diamond business. He or she has access to the Internet and Rapaport lists, and is very mobile, able to buy from anywhere. In the future, consumers will be even better informed, which will require openness and transparency in all dealings.”

He also noted that technology is bringing better exploration methods, improvements in cutting diamonds, and new treatments and synthetics.

“These things are here to stay,” he said.

Israeli diamond manufacturer Lev Leviev, who has built one of the world’s largest diamond operations, with an annual turnover of $2.5 billion, spoke at the Couture Conference Oct. 14 and a week later at the Diamond Dealers Club in New York.

In his first talk, he said the diamond industry is struggling to find direction: “American retailers see their profits shrinking, diamond producers are selling direct to the public, and the Internet is bypassing traditional channels.”

He offered several ways to deal with these challenges. “Keep to your core business and do not allow suppliers to run your company. Be sure you have and keep a reliable diamond supplier, and be prepared for supply uncertainties.”

Leviev also advised retailers and diamond dealers to make certain that marketing plans and business relationships make good business sense.

“Think big and stay independent,” he said.

Speaking to the Diamond Dealers Club, he noted that U.S. demand for high-quality diamonds will continue to grow. 

“Manufacturing will continue to move to emerging nations in Africa and the Far East. The trend will be [to stay] close to the source,” he said, adding that he has opened a diamond manufacturing facility in Namibia and is planning factories in Botswana and Angola as well. 

Leviev believes that many of today’s branding efforts are too small to be effective and too confusing to consumers. “The DTC demands promotion of many different brands. I do not agree; I believe there are too many brands. You need fewer, stronger brands. Diamond dealers must invest in leading brands instead of a unique cut,” he said.

Steve Forbes, president and CEO of Forbes Inc., noted at the Couture Conference that branding efforts must focus on a niche. He said that in uncertain times, there is always a great deal of consolidation among the smaller, weaker players.

“However, along with that, there is a proliferation of niche retailers,” he said. “Those who work smarter know how to direct their appeal to a certain segment of the market.”

Forbes also advised retailers and diamond dealers “to make the Internet their friend” and noted that brick-and-mortar operations have an advantage over Internet companies. The Internet, he said, can lure customers in, “but consumers still want a tangible presence to turn to if they are unhappy.”

Much of the discussion at the World Federation of Diamond Bourses (WFDB) sessions of the World Diamond Congress, held Oct. 18–20, centered on the role of the smaller diamond dealers and brokers in an industry now dominated by the DTC’s Supplier of Choice initiatives.

Shmuel Schnitzer, WFDB president, told the delegates from 23 member bourses that the DTC is working with smaller dealers and manufacturers by providing more than $500 million worth of rough diamonds to the open market this year.

A contingent of dealers strongly criticized the DTC Supplier of Choice initiatives for favoring large players at the expense of the smaller companies that comprise the bulk of WFDB membership. Several expressed support for a class-action lawsuit against the DTC filed by Derek Parsons, president of the Diamond Club of Florida. Schnitzer, however, noted that negotiation – not direct action – has been more effective in securing scarce rough from the DTC.

Schnitzer also noted that consumer confidence is an increasingly important issue in the face of continued publicity over conflict diamonds, new generations of synthetic diamonds, and advances in diamond treatment.

The International Diamond Manufacturers Association (IDMA), meeting at the same time, heard Jewelers of America (JA) Executive Director Matthew Runci say that “diamonds and gold are very susceptible to advocacy groups pressing environmental and social issues, such as conflict diamonds.”

“We as retailers cannot afford this type of [media] exposure,” he said, noting that JA has taken a proactive approach in asking its members to require a code of corporate responsibility from their suppliers.

He also noted that JA member retailers responded well in a recent survey conducted by two such advocacy groups, Amnesty International and Global Witness. While the survey generally found that a minority of the U.S. and British retailers surveyed had good knowledge of conflict diamonds and the procedures in place to block them from the market, “80% of JA members did have adequate procedures in place.”

Runci said that JA would concentrate on educating its members, not policing suppliers, because retailers deal directly with consumers “and that’s where the ultimate issue lies.”

Representatives of Global Witness and Amnesty International addressed the WFDB meeting to report on the retail survey mentioned above. They said 56% of the retailers failed to respond to a mail survey, and staff members in just 42% of the stores they visited were aware of their company’s policy toward conflict diamonds.  These findings, they said, demonstrated that more monitoring is needed because industry self-regulation is not working.

Delegates offered a heated rebuttal, saying that the survey was moot because Kimberley Process (KP) controls require certification for all rough diamonds and that the WFDB – which represents virtually every major diamond center in the world – and the IDMA fully endorse all KP and [De Beers] Best Practice principles.

Fred Hegar, president of the London Diamond Club, argued that Kimberley Process controls on rough diamonds made such retailer precautions superfluous. “Show me one diamond that did not come from rough. Rough is fully controlled, and we are fully cooperative (with the KP) in this organization.”

By the end of the Congress, both WFDB and IDMA endorsed a resolution reaffirming their commitment to support the Kimberley Process and follow Best Practice principles.

The organizations also approved two resolutions regarding treated and synthetic diamonds. The first called on all major diamond grading laboratories to display the HPHT notation prominently on their grading reports, “so the treatment is clearly evident at first glance.” The second resolution called on the labs “to cooperate fully with all internationally recognized trade associations to formulate a common standard of disclosures and nomenclatures.” The measure also requested that labs refrain from grading synthetic diamonds.

A number of delegates also sought a resolution asking labs to refrain from grading HPHT-treated diamonds. However, Martin Rapaport, publisher of the Rapaport Diamond Report, noted that “detection of these goods is the first line of defense, and submission of these goods to the labs helps further that goal.”

Russell Shor
Senior Industry Analyst

In September 2004, Gems & Gemology Editor Brendan Laurs visited several gem deposits in Zambia and Malawi as part of a collaborative research project to gather firsthand information on the location, geology, and gem production of commercially important sources in southern Africa. The other collaborators were Dr. William B. “Skip” Simmons of the University of New Orleans, Louisiana; Dr. Hanco Zwaan of the National Museum of Natural History, Leiden, the Netherlands; and Bjorn Anckar of the European Union’s Mining Sector Diversification Programme (MSDP) in Lusaka, Zambia. Anckar, a geologist and gemologist who has lived in Zambia for the past two and a half years, was the guide for much of the trip.

Their fieldwork in Zambia focused on three regions: Kafubu for emeralds, Mkushi for tourmaline and morganite, and Lundazi for Canary tourmaline and aquamarine. In addition, they visited the Chimwadzulu Hill ruby/sapphire deposit in Malawi.

Kafubu Emerald Region. With a reputation as the world’s second most important source of emeralds by value (after Colombia), this broad area near the Kafubu River contains several large open-pit mines that are being actively worked by international companies using heavy equipment. The geology at all the mines is rather similar: Emeralds are hosted by phlogopite-biotite schist adjacent to quartz-tourmaline veins, although the mineralization is quite uneven and unpredictable.

They visited four pits: Grizzly, Chantete, Pirala,  and Twampane. The first two were being mined using large haul trucks and excavators (figure 1). The largest mining concession in the area (consisting of several pits) continues to be operated by Kagem Mining Ltd., and another prominent operation, the Kamakanga mine, also was active. At all the big pits, the miners drill and use explosives to open the areas adjacent to the veins, and emeralds are hand-picked from the mineralized schist by experienced “chiselers.”

Security remains a problem at all the mines, and Laurs and the other visitors were told that some deposits lose more than 80% of their production to theft. Most of Zambia’s emeralds are exported to India (for use in the domestic market) and Israel (for international distribution).

The Kumanga mine is another source of gem tourmaline in the Mkushi area, and has been mined by Raj Sharma (Gemstone Marketing & Consultancy Ltd., Lusaka) since 1998. It has produced 15 pockets with tourmaline ranging from pink, bicolored pink-green, green, to dark blue.

Lundazi Pegmatite Area. Numerous pegmatites containing gem-quality aquamarine, tourmaline, and spessartine occur in eastern Zambia, in a large area west and southwest of Lundazi, and east of the Luangwa River. Since the mid-1990s, commercial quantities of bright yellow “Canary” tourmaline have been recovered from primary and secondary deposits in a localized area covered by two mining concessions: Kabelubelu and Tumbuka. These concessions have been leased since late 2002 by Tommy Wu (Shire Trading Ltd., Hong Kong) and Rita Mittal (Southstream Enterprises Ltd., Lusaka), who have undertaken further exploration of the pegmatite and also used a washing plant to process the secondary deposits. Most of the Canary tourmaline is heated to 500–550°C to bring out the bright yellow color from the typically brown to greenish yellow starting material. Future work will focus on mining Canary tourmaline from the secondary deposits.

In this contributor’s opinion, the gem areas described above show significant future potential. The Kafubu emerald area, in particular, is far from exhausted and could benefit from more systematic prospecting and the introduction of modern washing plant technology. Zambia’s pegmatite districts also show potential, although additional discoveries will depend on securing the necessary capital for further exploration and mining. The Chimwadzulu Hill deposit seems poised for a major expansion. Additional developments and further details on these deposits will be reported in future articles that are being prepared for submission to Gems & Gemology.

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, 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.

Spinel is one of the few singly refractive (SR) transparent blue gems in the market. If a stone is SR and its refractive index (RI) is between 1.70 and 1.75, it is most likely natural or synthetic spinel. These are virtually the only identification options for transparent blue SR stones within that RI range. Gahnite and gahnospinel (other members of the spinel group) have higher refractive indices.

There are two main types of natural blue spinel: a common, grayish blue type that is colored by iron; and a rare, vibrant blue type that is colored by a combination of cobalt and iron (typically called “cobalt” spinel).

Natural spinel usually displays an RI around 1.718. It may show weak to moderate anomalous double refraction (ADR) in the polariscope. Magnification may reveal minute octahedral spinel crystals or negative crystals arranged singly or in fingerprint patterns. Included crystals of graphite, dolomite, or sphene may also be seen.

The spectrum of natural spinel typically has dark bands caused by iron, with the two most prominent ones in the blue region: a broad band centered on 459 nanometers (nm), and a distinctive but much narrower band at 480 nm. There are other possible bands at 553, 593, 632, and 670 nm.

Iron-rich natural spinels are inert to ultraviolet (UV) radiation. Cobalt-rich natural spinels are inert to short-wave ultraviolet (SWUV) but may show weak to moderate red fluorescence to long-wave (LWUV).

The most common method of producing synthetic spinel is by flame-fusion, but flux-grown synthetic spinels may also be seen. Flame-fusion synthetic blue spinels are usually paler than flux-grown synthetics, which can display the vibrant blues of natural cobalt spinels.

Flame-fusion synthetic spinels generally have higher RIs – around 1.728 – than their natural counterparts, because the flame-fusion growth process requires more aluminum and oxygen than natural growth does. Typical flame-fusion internal characteristics are tiny, thread-like gas bubbles and “breadcrumbs.”

Flame-fusion synthetic blue spinel shows strong red fluorescence under LWUV and a mottled to bluish white appearance under SWUV. Different tones produce different fluorescent colors. Under a polariscope, flame-fusion spinel typically shows strong ADR in a “cross-hatch” pattern due to strain within the crystal.

The presence of cobalt gives flame-fusion synthetic blue spinel a distinctive spectrum, with strong bands dominating the green to orange area at 540, 580, and 635 nm. Even pale-colored gems show a spectrum that is strong enough to separate them from similarly colored aquamarine. If the bands are faint and hard to see, try viewing along the length of the stone or use the internal reflection method.

Flux-grown synthetic spinel contains inclusions typical of this growth method. Orangy brown to black flux inclusions, alone or in a fingerprint pattern, can be seen, and metallic platelets that might be platinum or iridium from the crucible may also be detected.

Flux-grown synthetic spinel shows weak to moderate, slightly chalky red to reddish purple fluorescence under both LWUV and SWUV, with the short-wave reaction being slightly stronger. Russian flux-grown synthetic blue spinel appears red to orangy red through the color filter; flame-fusion synthetics appear red. Natural spinel is usually inert through the color filter, although cobalt spinel might show a reaction similar, though weaker, to flux-grown synthetics.

A key to distinguishing a blue flux-grown synthetic from natural spinel is the absence of the iron lines at 459 and 480 nm in the blue region of the spectrum. These lines have not been observed in the spectrum of any synthetic blue spinel.

Both flux-grown and flame-fusion synthetic blue spinels show strong absorption bands between 535 and 550 nm, 560 and 590 nm, and 615 and 635 nm. They also show weak absorption at 430 nm that extends into the UV. In natural cobalt spinel, the cobalt absorption bands are in similar positions, but a little broader and more diffuse.

Some dark-colored synthetic spinels are so rich in cobalt that you might actually see some red flashes when you examine them under a strong light source. You might see the same reaction with natural cobalt spinel.

GIA's Gem Identification course provides professional instruction in identifying characteristics of natural blue spinel and how to distinguish it Its synthetic counterparts. Click here to learn more about this course and GIA’s other gemological courses and diploma programs.

The Steinmetz Group of Companies has been named the premier sponsor of GIA’s fourth International Gemological Symposium. The renowned event, which will also commemorate the Institute's 75^th (diamond) anniversary, is expected to bring upwards of 1,500 industry leaders to San Diego, Calif.

The Steinmetz Group’s $250,000 contribution will also support the event’s “Diamond Gala” opening night celebration, an elegant evening of socializing, spectacular museum exhibits, celebrities, and top-rate entertainment at GIA’s world headquarters in Carlsbad Sunday, Aug. 27, 2006.

“There are a lot of things that appeal to us about GIA’s Symposium,” said Steinmetz CEO Nir Livnat. “I think this special gathering of the industry – not just the diamond industry, but also the colored stone, pearl, retail and manufacturing sectors – puts us in front of a wide variety of people. We usually don’t get that kind of opportunity.”

GIA’s International Gemological Symposium, previously held in 1982, 1991, and 1999, is frequently referred to as the world summit of the gem and jewelry industry. Experts from both within and outside the industry will give detailed presentations on key issues and provide forecasts and solutions for topics of concern during the event, Aug. 27–29, 2006, at the Manchester Grand Hyatt in San Diego.

“The issues at Symposium are going to be approached in a very broad way, not just showing the good things, or just showing synthetics or treatments. I think it’s very, very important to see the whole array of issues,” Livnat said.

The Steinmetz Group has participated in a variety of high-profile events in recent years, including “The Splendor of Diamonds” exhibit at the Smithsonian’s National Museum of Natural History in Washington, D.C., which featured the 59.60-c