Diamonds are valued equally across cultures—they can be a status symbol or a reflection of a country’s history, rulers and more. Diamonds themselves fuel an industry worth $14 billion—they can pull an entire nation out of poverty or pit governments against each other. Asia for example, has a treasure trove of diamond mines and is perhaps best known for its naturally created fancy colored diamonds.
Diamonds Natural to Asia
Since about 2006, Asian investors have helped drive the popularity of fancy colored diamonds. According to Fancy Color Research Foundation (FCRF), fancy colored diamonds (pink, yellow, and blue diamonds) experienced an average total appreciation of 154.7%. The FCRF also reported that China and Hong Kong represent about 40% of sales of the fancy colored diamond market. This is most specific to pink diamonds, a popularity driven by Asian customers.
Asia’s mines produce a variety of fancy colored diamonds and it’s their high demand and rarity that make them an attractive investment. For example, Sotheby’s Hong Kong sold an 8.41-carat purple-pink diamond for a record $17.77 million U.S. dollars in last year’s Magnificent Jewels and Jadeite Autumn Sale.
Diamonds and the Asian Culture
Diamonds are not just a girl’s best friend in Asia. Men love them too and often walk into stores looking for his and hers fancy colored diamond rings.
Also, Reuter’s reported that gold is still hugely popular in China, both as jewelry and as an investment. The World Gold Council said earlier this year that China was set to challenge India’s position as the world’s top gold consumer, with 2013 demand soaring more than 20 percent to 1,000 tons. But diamonds have steadily increased as a share of China’s overall jewelry market, accounting for just under one third now from one quarter five years ago, according to Euromonitor.
Diamonds in Asian History
Early in history diamonds were used as tools to engrave, but in many cultures, they were considered mystical or medical icons. The same applies to Asian culture. The American physicist Peter J. Lu discovered that the ancient Chinese not only knew about diamonds, but also used them in the jewelry industry. Chinese artists used diamond gravel to polish and cut jade, sapphire and other precious stones. Many precious stones have a hardness almost comparable to diamonds – the fine abrasion of the diamond dust is ideally suited to working them.
China is now the second-largest market for diamonds, after the United States, and it is likely to surpass the United States as the biggest diamond market in the world in the next decade, according to De Beers.
Asia successfully continues to fuel the diamond and gem industry. What are your thoughts on fancy colored diamonds? Do you favor them over traditional colorless diamonds?
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