I received an email from someone that related to the entire complex issue of “glass-ruby composites” — what they are really “worth,” why disclosure doesn’t occur and why it shouldn’t matter anyway if someone likes the product and can afford it. This led to a conversation about the “value” of any gemstone, and whether or not they have any value at all, asserting that value is “fleeting” at best. He made an historically interesting point related to the extremely high value of certain metals during ancient times, which have no value now, and which, in fact, contributed to the financial rise and fall of certain civilizations. All interesting, but reflecting a limited understanding of the current gem world, economics and market dynamics.
Several people in the trade have suggested to me that it might be helpful to discuss some of these issues from my perspective.
Value Judgments About Products
There are many products in today’s gem and jewelry world from which consumers can choose — perhaps more than at any other time in history — in every color and at every price point. I rarely make “judgments” about the products themselves because I realize that there is a market for all of them. But I do judge how products are represented and described—do they accurately communicate to prospective buyers what they are, and how they compare to other products in the market — and does the pricing accurately reflect the quality/rarity indicated by the description. If that is done with full disclosure, I have no problem with any product being sold.
I have no problem theoretically, for example, with the introduction of a new product that looks like ruby and which is made by combining tinted glass with a low-grade “ruby” (or more accurately, corundum, the mineral called “ruby” only when it is transparent and red in color). These “glass-ruby composites” look more like ruby than simply red glass, and in fact, often look like fine ruby. We have many examples throughout history, from ancient times, of humans making things that look like rare gems—glass, “composite” stones of all types dating over 2000 years old, dyed quartz and other materials, and in more recent times, lab-created stones. The issue is not that these products have been created; the issue is how they are represented and sold— whether or not the buyer is told what they are really buying, and whether or not the price is appropriate for what the product is. If something that “looks like” ruby is sold as a “genuine ruby” (or emerald, sapphire, pearl, etc)—regardless of the price at which it is sold—this is, in my view, a deceptive practice; when sold with full disclosure as something that “looks like” whatever gem it is simulating, this is another story altogether.
Here is where the “ruby-glass-composites” usually cross the line — in being represented as a genuine ruby (albeit “treated”) rather than an imitation. It is not ruby; it does not have the toughness and durability of ruby, and it lacks the rarity and value of ruby. Even rubies treated by “extreme” methods still have durability, and are rarer and costlier than this material.
This is why I’ve been so outspoken about this particular product, because buyers are being misled into buying something that is not what they are led to believe it is. This is unfair to consumers because they are not getting what they think they’re getting. It is unfair to honest, knowledgeable jewelers because consumers the jewelers with whom they should be considering a purchase are over-charging for what they are selling. This results from misrepresentation of what these “composites” actually are…because they appear to be comparable to genuine ruby when they are not.
Fortunately, I’m encouraged by what we’re starting to see among respected labs; more and more are now identifying “glass-ruby composites” as exactly what they are—“glass-ruby composites” –rather than as “ruby” with “comments” related to treatment and care, which has previously been the case. I think this signals a change in attitude within the gem/jewelry world about this product. I am hopeful that this may lead to a crackdown on sellers being able to call them rubies and, as such, succeed in selling them at highly inflated prices. As I said above, I see nothing wrong with “the product” and think they make an attractive alternative to other ruby-like products when properly described and priced. I think they offer a great new product for the fashion jewelry marketplace…when sold at “fashion jewelry” prices, which would be appropriate and reflective of what the product they are actually getting.
Price Considerations
Now, in terms of “price,” I was asked what the “real value” of these composites should be, and “who should dictate this.” This isn’t an easy question to answer at this time because current “prices” don’t reflect accurate identification and disclosure of the product to consumers—and with any “new” product introduction into the marketplace its “value” will ultimately be determined by the law of supply and demand…but the law of supply and demand will be severely skewed if the information about the product is misleading. The law of supply and demand works only when there is accurate and reliable information about what the product really is.
The description of any “new” product — the attributes that make it different and unique —are what set it apart from other alternatives in the market and determine whether or not it is anything people want. And the product cost is one of the factors that influences whether or not people like it and want it. But here again, only if the attributes are accurately described and full disclosure is provided can prospective buyers have a full understanding of what the product really is—and how it compares to alternatives already in the market. What I would be willing to pay for a product described as “ruby” would be very different from what I’d be willing to pay for a ruby-like product made from a glass-and-ruby mixture. Now if others are like me, demand would be related to price, and price would be related to what my other choices are in the market…and how the alternatives are priced.
How Alternatives Affect Market Demand and Pricing
Let’s look at glass-ruby composites in this way. As a “ruby look-alike” what are the current “alternatives” from which a consumer might choose? What are the other available products that “look like” ruby, and how do they compare in terms of cost and other features? If compared to alternatives (see below), you could see where that it has benefits over glass alone and could fill a nice niche in the market at a price between that of glass and other “alternatives”:
- red glass: man-made; fragile; special care needed to retain beauty; under $1 per carat, any size
- genuine red garnet (or other gems that occur in a “ruby” color, but garnet is most affordable): natural; durable; $30-$50 per carat (2-carat size) .
- synthetic ruby: man-made (but entirely “ruby), durable; $50 – $150 per carat (2-carat size)
- treated ruby: made by nature/enhanced; durable; $250 – $6500 per carat (2 carat size)
- composite glass-ruby: mixture of glass and ruby; more durable than glass, less durable than garnet, synthetic or treated ruby; requires care to protect beauty; $10-$20 per carat (2-carat size)
Looking at ruby-glass composites in this way, we can see that a glass-ruby composite has some benefits, but the deciding criteria will clearly be price; offering a glass-ruby composite- at a price in between the price of glass and that of garnet would be a good starting point, and price could be lowered, or raised, depending upon consumer demand…based on clear and straightforward representation.
When these glass-ruby-composites were first introduced, they were priced at an excellent price point to fill a new niche — they contained glass, but were priced higher than glass because they also contained “genuine” corundum/ruby; garnet was genuine, but not as rare as corundum, and these actually contained the rarer corundum/ruby; synthetic ruby was all-ruby, but also made by man and more expensive; and genuine “treated ruby” was much more expensive. Had this product been sold as a new product combining lead-glass with corundum that looked like genuine ruby at a fraction of the price, and let market dynamics evolve, the size of the market would have become apparent very quickly, along with its value — that is, what consumers were willing to pay for it in light of other alternatives.
Unfortunately, this is not what happened. The product itself was never given the chance to see how it would have been received by consumers if sold as a glass-ruby composition that was new and different from anything else in the market. If the product were to have found broad consumer acceptance, demand would have grown, and depending upon supply and demand, a value would have been established based on other options already in the market and a perception of having added benefits over other products: low price, a stone that actually looked like real ruby, and one that actually had genuine ruby in it.
Value Reflects Supply and Demand
In terms of “value” for gems in general, we are clearly seeing the impact of supply/demand economics. With the growth of newly emerging “consumer” markets in places such as China and Southeast Asia, demand for gems of every type has increased dramatically. In cases where supply has not been able to keep pace with demand, prices have strengthened; we’ve seen this with gems such as tourmaline (especially rubellite) and pink topaz, as well as many “treated” gems because demand is out-pacing supply. For example, a very fine, unmounted, rich pink topaz weighing 61.6 carats, estimated to sell for 20,000 − 30,000 Swiss Francs, sold for over 200,000 Swiss Francs, reflecting increased interest in — and the resulting increase in demand for — beautiful stones in this size and quality, and the difficulty in obtaining them due to declining supply.
For those varieties of gems not “routinely enhanced”—such as spinel, garnet (especially green and orange varieties), and peridot—demand is also outpacing supply; very fine red spinels, tsavorite garnet and peridot have all doubled in price over the past 18 months and as demand continues to strengthen, prices are predicted to strengthen even more, and also create a trickle down effect for stones of less fine quality.
In terms of the best known and most coveted gems, such as ruby, sapphire and emerald, price increases are even more dramatic; supply has not kept pace with demand for the past 5 years, but now that demand is so much greater than ever before, prices at which these gems are being sold are beyond anyone’s expectations. Beautiful natural rubies, over 3 carats in weight, for example, are now very rare, and demand has increased more in this past year than previously. As a result, with the number of people wanting to buy them increasing so much, prices have more than doubled in this same time period — and in sizes over 5 carats, the finest natural gems are commanding whatever price a buyer is willing to pay.
A Useful “History of Gems”
The fact is that people have been mesmerized by beautiful gems since the beginning of time. Surrounded by myth and lore, coveted by royalty, desired by the wealthy, there is no indication that demand will subside in our lifetime. And supply and demand will continue to impact “value.” History has also shown us that gems that may be readily available today may become rare tomorrow, and if demand continues, prices will get even stronger. The reverse is also possible; gems that are rare today may become less rare if a new deposit is discovered somewhere, and if supply outpaces demand, then prices could drop.
I hope I’ve been able to shed some light on this topic. For any gem (or any product), in the end it is “people” wanting it, how common or scarce the product is, and what people are willing to pay for it, that determines “value”/price. There is a price at which people will buy a certain product, and a price beyond which they will not. If enough people want a particular thing, and can afford to pay the price, and supply matches demand, the price will be stable; if supply decreases, and there are people who continue to want it and can afford to pay more to have it, prices will strengthen. And in some cases, supply is so limited and demand so great, that prices seem to be insane. It is also true, as history has taught us, that prices can reach a “bubble” peak, demand can change, and prices can weaken. We are not currently seeing any sign of this, however, where the rarest and most beautiful natural (untreated) gems are concerned.
But after all is said and done, “value” is related to rarity and rarity is related to “quality differences,” and quality differences are related to whether or not we are talking “naturally” or after “enhancement.” While price is determined by “supply and demand,” it hinges on knowing what you are buying, and that requires “proper and full disclosure” as to what the product really is. Where gems are concerned, proper disclosure is essential to determining a particular gem’s “value” in the marketplace, and without it, all “value” is distorted and unreliable and sellers are discredited.
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Latest posts by antoinettematlins (see all)
- Great New Book — A “Must Have”! - February 14, 2013
- The Allure Of Gemstones – Keeping The Sparkle In Your Asset - August 30, 2012
- The Gem Merchant by David Stanley Epstein - July 20, 2012
{ 3 comments… read them below or add one }
Great post Antoinette! Glad to see your blog here. Craig
Excellent,
I’m always surprised at gem shows, especially Tucson, that there can be aisle after aisle of vendors at even the best of shows selling composite or lab created stones, with very little disclosure. I would like to see these shows clean up a bit, to give the credible vendors better exposure. As is, it is very hard to dredge through these shows without getting taken.
Also, Jewelry TV. I get at least one customer a month that will bring me a 30-40 carat stone that they paid $5-20 for that turns out to be glass or a colored CZ.
Dishonesty just seems to be the status quo in a very unregulated field, it seems.
Well said, Antoinette!