Coloured gemstones at auction: the next big thing?

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Delve into sales of untreated tones and the appetite for bright gems.

While large diamond sales typically win all the headlines, auction houses and stone dealers have noticed increasing demand for coloured gemstones, especially those that are untreated. Kathryn Bishop reports on the development of the ten and finds out whether Britain could position itself as a new international gem trading platform.

In May last year Bonhams New York announced that it was to hold its first ever gemstone and mineral auction. The reason? The auction house had recognised growing demand for such a specialised sale.

The auction was set to include packets of gemstones owned by London-based gemstone collector and retired jeweller Robert Wander, as well as exceptional stones weighing several hundred carats.

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The results of the auction were eye-opening. Among the packets of stones, most of which sold for several thousand dollars, stood several large unmounted gems. It was the more natural of these that stood out and became the hero lots of the day, including a pigeon’s blood Burmese ruby that, while only weighing 4cts, achieved a sale price of US$60,000 (£37,416). A rare white natural non-nacreous conch pearl from a giant clam, totalling 32.45cts, also wowed with a hammer price of US$35,000 (£21,826).

This auction, which attracted international clientele, marked the evident desire for natural stones and a growing interest from collectors and investors.

Naturally Does It
In Europe a similar story is being woven at auction houses in Geneva and London. At Christie’s London, head of jewellery Keith Penton says that the arrival of fine coloured gemstones to market often provokes anticipation among stone collectors, with a growing interest from overseas dealers or collectors helping to drive prices upwards.

“Collectors appreciate that the very best coloured [stones] are extremely scarce and if a fine unheated Burma ruby or Kashmir sapphire comes onto the market it always causes a lot of excitement,” Penton says. “In recent years Asian and Indian buyers have been much more active in the salerooms and this has helped to push the market to new levels.”

Former diamond dealer and jewellery auctioneer Joanna Hardy, who today works as a private jewellery consultant, explains that the scarcity of certain stones is what draws interest. “Unheated Burma rubies, Kashmir sapphires and Colombian emeralds that have not been enhanced have been achieving record prices because they are genuinely very rare,” she notes, explaining that the rise in coloured gemstones under the gavel has brought other bright stones to the fore. “The demand for colour has meant that other gemstones have attracted the attention of the international buyer and such stones as Paraiba tourmalines, spinels, rubellites, pink sapphires and topaz, to name but a few, are being sought after by the discerning collector.”

It is the natural stones, however, that win some of the highest prices; in particular those bought for investment purposes. Bonhams New York gemmologist and co-consulting director of its natural history department Claudia Florian explains that the reason for the explosion in gemstone sales is often due to baby boomers inheriting stones they have no need for, and can make a respectable sum from by selling, even during – or perhaps because of – tougher economic times.

Penton agrees that investment, or the funds gained from selling natural stones, is pushing more people to buy and sell. “There is a lot of interest in investment at the moment and collectors want to put their money into the very best gems available,” he says.

Penton adds that, owing to the evolution of stone treatments, good laboratory reports are essential nowadays to reassure buyers. “As the level and type of treatments become more varied and more difficult to detect, the laboratories have responded to the need and the certificates contain more detail," he explains. "As more sophisticated treatments are developed, the more collectors focus on natural unenhanced gems.”

London-based Gemfields has become recognised as a leading producer of emeralds and amethysts in the global marketplace, and this year is set to push into mining of rubies and sapphires. From its London office it has worked with clients across the world, teaming with Indian jeweller Amrapali for an ethical emerald line, and making its move into the US market last September. Its growth was reflected in its financial results last year, with profit up 140% year on year, with revenue from its emerald and beryl sales more than doubling to US$83.7 million (£52.2m).

Gabriella Harvey, director of cut and polished stones at Gemfields, notes that clients looking for gemstones understand their scarcity, especially following many years of large, fine diamonds being sold at auction. “Consumers are far more aware of how rare fine coloured gems are in comparison to diamonds – they are far more unique,” she explains. “Emeralds for example, are 20 times rarer than diamonds due to their limited source.”

Harvey agrees that rarity of natural stones – in particular emeralds, which are subject to treatments that have become expected, such as oiling to improve clarity – is a client preference. “It is about the naturalness of an individual gemstone, the preference will always be to have untreated stones in their most natural form – again they are rarer,” she explains.

The UK’s Role in Gems
With an increase in interest from collectors, dealers and investors at a global level, the market for fine coloured gemstones is ready for the taking. With producers such as Gemfields driving forward their sales, and with London home to some of the most exciting jewellery auctions and previews of the past few years – including the sale of the Duchess of Windsor’s jewellery collection and the showcase of Elizabeth Taylor’s jewels – the potential for Britain to step into the spotlight as a leading trade platform is there.

Penton, who oversees the jewellery going for auction at Chrisite’s London, views the British gemstone sales market as still in development, as Switzerland continues to reign as the country of choice for vast gemstone and jewellery auctions. “London is of course still an important hub and has a proven track record for achieving some of the best results when it comes to the sale of important antique coloured gems [but] for the past 43 years our biannual Geneva sales have provided the premier platform for the sale of the most important coloured gems that we offer in Europe,” Penton notes. “There are a number of reasons [for this], including the convenient Swiss taxation system.”

Christie’s Geneva auction of Lily Safra’s jewels in May last year, for example, was a white glove sale – meaning 100% of lots sold – totalling £23.4 million, far exceeding pre-sale expectations. Then in New York on December 10 Christie’s sold some more important gems, including several unheated Ceylon sapphire rings with guide prices of $250,000 (£155,400).

While large stones are typically sold outside the UK, Hardy believes that there is potential to sell such stones in Britain. “There are auction houses all over Britain that would do well in concentrating on this area as I see it has great potential, so long as the quality of the stones offered matched the expectations of the international buyer,” she says.

Demand for British Gems

Here in Britain a number of abundant and also rare homegrown gemstones and minerals exist, but many jewellers and designers often overlook the potential of tapping into the Britishness of such stones.

At CW Sellors, the Derbyshire-based jewellery manufacture, the promotion of British stones is very much part of its marketing and sales pitch. CW Sellors workshop manager Paul Barker explains that its focus on British stones has evolved over the years. “[We] initially worked mainly with Derbyshire Blue John, but over time CW Sellors has evolved and now works with a far wider portfolio of British gemstones," he says. "[We now work with] Whitby jet and most recently Preseli Blue Stone, plus we have also worked with marbles and granites from all over the UK for many years.”

The use of British stones comes with its fair share of challenges, however, from both a supply angle and a practical one. “You need to have jewellery technicians and designers who understand the unique properties of the stone,” explains Barker. “It is key for us to educate customers [so] our products are all provided with informative stone cards which explain the heritage of the particular stone bought. We also run talks about Whitby jet on a regular basis and are planning more Blue John talks in the future.”

Gemstone wholesaler Marcia Lanyon works with about 60 different types of stone, but says demand for British stones is still very small, apart from the occasional enquiry about jet. “Probably the only one we do get much demand for is jet, though many will settle for black onyx instead as it is less brittle,” she explains. “We would mostly refer customers to specialist companies such as CW Sellors who cut and sell jet rather than try and supply it ourselves, partly because most of the enquiries are for something very specific that needs cutting and CW Sellors are able to do it.”

Lanyon notes that demand for British stones – which also include Scottish Cairngiorm, sapphire, garnets, topaz and agates, among others – is naturally limited by supply. “I don’t think that England really has enough good stones for the Britishness to be a useful selling point,” she explains. “If you could say for sure that it is UK rough that you have had cut, people might be interested, but I suspect unless you were selling UK souvenirs or had some other pressing reason for selling British, people would not care where it came from. The main concern nowadays is whether it is from any conflict area, or areas where human rights and safety are not good.”
Barker also notes that the British aspect of the stone largely appeals to locals associated with where the stones or minerals are found. “It’s mainly people who live in the immediate area and who have family connections to the source, therefore in our case the British do thoroughly support British gemstones,” he surmises.

With the growing interest in fine gemstones, Britain could certainly position itself as the go-to country for antique and fine gemstone buyers; the only weighty challenge now being to snatch the crown from other leading locations – namely Geneva and New York – to become synonymous with superior stone sales.

This feature was taken from the January issue of Professional Jeweller. To read the digital edition online, click here.
 

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