Data Suppliers: Index Feedback

The FCRF data suppliers are 24 of the most influential fancy color diamond companies in the market. Among these companies are manufacturers, traders and other specialists, each representing a different segment of the fancy color niche. The data suppliers, in addition to being members of the FCRF, are responsible for providing high quality pricing data every quarter in order to generate the Fancy Color Diamond Index (FCDI). The interviews below provide insights on the quarterly index readings.

Name
Ishaia Gol
Company
Ishaia Trading Corp.
Dealing in Fancy Color Since
1978
Location of Offices
New York, Geneva and Ramat Gan
Fancy Color Price Category
Medium to High
Do you think that "yellow" prices last quarter hit rock bottom and the recent increase is a result of customers' demand? Or is it due to a shortage of rough?
I think it’s demand for yellow. Yellow diamonds are still relatively cheaper than white stones in the same size category. Medium quality white stones are much more expensive than Fancy Yellows.
What is your rationale for the increase in demand for intense and vivid pinks and blues? They both outperformed the 'fancy' category in percentage to their respective color groups.
I think most people who are buying diamonds already have anything you can think of in whites: 5, 10, 30 ct stones. The next step for them is fancy color. They want the best of the best. Money is no object and there are a lot of people fighting and looking for colored goods that are all in short supply. There may be 1 or 2 stones a year in these color categories; they’re extremely rare. The demand is significantly higher than the supply.
Name
Martin Georgiadis
Company
Diacore
Dealing in Fancy Color Since
1995
Location of Offices
Botswana, South Africa, Namibia and New York
Fancy Color Price Category
High
Do you think that "yellow" prices last quarter hit rock bottom and the recent increase is a result of customers' demand? Or is it due to a shortage of rough?
I believe that prices for yellow diamonds have hit the bottom, however, buyers are still very selective when purchasing. The fact that the polished is in strong hands is more important than any shortage of rough.
What is your rationale for the increase in demand for intense and vivid pinks and blues? They both outperformed the 'fancy' category in percentage to their respective color groups.
These stones have been actively pursued by the trade and investors for a number of years now, creating a shortage of polished. This increased interest in an area of the market where there is little supply has caused a dramatic surge in prices when compared to all other categories of diamonds. It should be noted, however, that this is limited to Intense and Vivid pinks and blues that are VS clarity or better. The lower clarities have not performed as strongly.
Name
Richard Vainer
Company
M. Vainer Ltd.
Dealing in Fancy Color Since
1980
Location of Offices
London
Fancy Color Price Category
Low to High
Do you think that "yellow" prices last quarter hit rock bottom and the recent increase is a result of customers' demand? Or is it due to a shortage of rough?
With the exception of the very strongest and purest grades, yellows are the most common of the the primary colours and the most price sensitive. They can thus be described as the connecting “bridge" between the highly commoditized white goods and the rest of the primary FCDs, and as such will be partially influenced by what is happening with the white market. The relatively recent closure of the Ellendale mine in Australia which had a large concentration of yellow rough in its run of mine is certainly one factor for the recent increase in prices.
What is your rationale for the increase in demand for intense and vivid pinks and blues? They both outperformed the 'fancy' category in percentage to their respective color groups.
I believe macroeconomic factors such as quantitate easing (money printing) and low to non-existent interest rates have a strong bearing on the above situation, and with the world’s wealthy searching for alternative asset classes. A diamond’s transportability and the sheer concentration of wealth in a carat of the strongest colours of blues and pinks allied to the very limited mining production in these categories of colour (especially in larger sizes) means that they have become the ideal vehicle for the discerning super rich. With such limited supply it does not take much demand to send prices on a continuing upward trajectory aided by the the continued publicity from the auction houses.

Q3 2015

Name
Elad Zohar
Company
Red Diam Ltd.
Dealing in Fancy Color Since
20 years
Location of Offices
Tel Aviv, with affiliations in New York, Hong Kong and Los Angeles
Fancy Color Price Category
Low to Medium and Medium to High
Once again the index shows stability in most categories and a high price increase in the blue category. Do you think it is related to the upcoming auction?
No, not really. I think it is only due to their rarity.
We know that recently there have been more calls for pink diamonds as compared to blue diamonds, but the price per carat of blue diamonds is higher. Why is that?
Well, the price per carat of blue diamonds is higher because of how scarce they've become in recent years.
In comparison to previous years, do you see less fancy color rough on the open market and in rough tenders?
No, I would say I see about the same amount in the market and at rough tenders.
Name
Shreyash Mehta
Company
Imperial Gems
Dealing in Fancy Color Since
1978
Location of Offices
London and Geneva
Fancy Color Price Category
Medium to High
Once again the index shows stability in most categories and a high price increase in the blue category. Do you think it is related to the upcoming auction?
No, I don't think it's related to the auction. The auction results will be something different.
We know that recently there have been more calls for pink diamonds as compared to blue diamonds, but the price per carat of blue diamonds is higher. Why is that?
Because of the marketing of Argyle diamonds. People are much more aware of pinks now, and blues are so scarce in comparison.
In comparison to previous years, do you see less fancy color rough on the open market and in rough tenders?
Yes. I definitely see less fancy color rough in the market and at tenders.
Name
MID House of Diamonds
Company
MID
Dealing in Fancy Color Since
2005
Location of Offices
Tel Aviv and 8 satellite offices worldwide.
Fancy Color Price Category
Medium to High
Once again the index shows stability in most categories and a high price increase in the blue category. Do you think it is related to the recent auction?
I think there's a connection, but the majority of very rare stones didn't decrease in value; rare Vivid Yellows and rare pinks haven’t gone down at all. Only the "ABC" goods saw a decrease in prices.
We know that recently there have been more calls for pink diamonds as compared to blue diamonds, but the price per carat of blue diamonds is higher. Why is that?
Only because of rarity. There are less blues on the market so the prices are higher. For every Fancy Blue there are 3 or 4 Vivid Pinks. That’s why the prices are significantly higher for blues.
In comparison to previous years, do you see less fancy color rough on the open market and in rough tenders?
I don’t deal with rough, only polish. I see less and less quality polished goods on the market due to a lack of cutting. Because I don’t see a lot of polish, I can tell you that there is less rough.

Q2 2015

Name
Michel Farrah
Company
Swissdiam
Dealing in Fancy Color Since
For 30 years
Location of Offices
New York, Geneva, Hong Kong, Antwerp
Fancy Color Price Category
Medium to High
In light of the results from the index in the last 6 months, how do you explain the difference in volatility between fancy color and white goods?
People want to invest in rare goods, locking things in safe and waiting for time to pass so values appreciate. They start with a few whites and then move to colors and buying something else, variety.
Do you forecast an increase in prices for certain items after the summer vacation?
I don’t think so. I don’t forecast an increase in prices.
Why do you think fancy color prices are holding up so strongly, even though the general demand for diamonds has softened?
They’re rare items and we target a very wealthy, small percentage of the population - they’re still wealthy and doing business. The art business is also doing very well because for the very expensive goods there’s still a market out there. These stones are getting rarer and rarer.
Name
Matthew Aldridge
Company
Gemcut S.A.
Dealing in Fancy Color Since
1978
Location of Offices
Geneva
Fancy Color Price Category
Medium to High
In light of the results from the index in the last 6 months, how do you explain the difference in volatility between fancy color and white goods?
In white diamonds you can get as many as you want of them, even if they’re 10ct D flawless. Fancy color is just so rare. I’ve been saying for the last 5-7 years that each time you sell a nice fancy color diamond you’re getting that much closer to closing your office. A nice FCD is getting rarer and in ten years time they’ll only be a few people who still have them. Diminishing supply and growing customer demand will speed up the process in their rarity.
Do you forecast an increase in prices for certain items after the summer vacation?
Fine fancy colors will continue to rise for the rest of our lives, let alone the rest of the summer.
Why do you think fancy color prices are holding up so strongly, even though the general demand for diamonds has softened?
There are very wealthy people out there who are being advised to buy a collection of fancy color now because they’re running out. They will probably be worth more in the long run. There are a million reasons to jump on the bandwagon. Even in 2008-2009, people said FCDs would go down and I said no way, so far I’ve been proven right.
Name
Marc Lazar
Company
Marc Lazar
Dealing in Fancy Color Since
1995
Location of Offices
New York and a presence in Israel
Fancy Color Price Category
Medium to High
In light of the results from the index in the last 6 months, how do you explain the difference in volatility between fancy color and white goods?
It’s primarily a result of the rarity factor. The index proves the consistent upward improvement in value of colored diamonds over time and demonstrates how they will keep going up in value. It’s the only area of the market that is improving.
Do you forecast an increase in prices for certain items after the summer vacation?
I don’t think there will be any noticeable change because of the vacation. It’s a market that doesn’t really take a break. Maybe people will make their final decisions for things they’re reviewing or considering, but as far as the supply demand and marketability and perceived value I think it’s a 24-7 type of market where you don’t see seasonal change. At least for my focus, I’m more focused on the rare, larger, high-end pieces.
Why do you think fancy color prices are holding up so strongly, even though the general demand for diamonds has softened?
I think it’s something that people have a lot of confidence in because of the real rarity factor and the continued historical success of it. I think it’s actually amplified by the regular diamond market not doing so well so more people are chasing the same target, which increased demand and strengthened it.

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