Friday, 23 March 2012

Sapphires soaring in value

A fabulous new Lucie Campbell Sapphire Ring:
Platinum Unheated Natural Burmese Sapphire 20.88cts calibre Diamond border Ring
[not yet on the website - please email for details]

At Lucie Campbell we specialise in sourcing exceptional and rare gemstones, not least among which are our sapphires: We aim to craft exquisite jewellery with the finest unheated natural Sapphires from Kashmir, Burma, Sri Lanka, and Pailin in Cambodia. And so it's with keen interest that we track the dramatic movements in the value of Sapphires.

Darren Clarke of Lucie Campbell explains:

How have Sapphire values risen?
Sapphire prices have risen more than 50 percent in a year - while availability is 40 percent less than a year ago.

Which Sapphires are most valuable?
Kashmir, the most coveted species of blue sapphire because of its rich colour, has become almost impossible to buy due to high prices and low availability. In its place, Burmese sapphires have become the “new Kashmir,” and prices have risen up to 100 percent on fine, large pieces since early 2008.

And unheated stones, why are they so rare and sought after?
The vast majority of both rubies and sapphires on the market today - upwards of 99 percent - are enhanced by artificial processes in an attempt to put in what nature itself could not. Often the enhancement is by high temperature heating, a process which is aimed at improving the gemstone's clarity as well as altering or improving its colour.

What's driving the dramatic price rises in Sapphires?

Changes in supply and demand are transforming the world of Sapphires, particularly declining production at the world’s most popular sapphire mines and greater demand from emerging consumer markets like China, India and Brazil. Furthermore, just like everywhere else, the high cost of energy and resources are also having a big effect on price and supply.

Sapphire production in the past few years has declined at better-known mines, with no new major sources discovered that could offset those reductions. In particular, there is a current scarcity in the marketplace of fine, blue sapphires from Burma, along with a major decline in Madagascan sapphire production in the past decade.

Why is Sapphire mining declining?
Burmese production has declined because the government diverted attention from gemstone to uranium mining, a more profitable endeavour as emerging markets like India and China chase resources.

Also affecting the global supply of sapphires is the fact that gemstone production in Madagascar — which supplied the majority of the world’s sapphires for the past 15 years — has taken a real nosedive. Most miners have moved out of the area since the former government stopped exporting rough gems in 2008 in hopes foreign gem buyers would open cutting factories in Madagascar. Unfortunately, the global economic slowdown and political turmoil in the island nation kept investors at bay. Despite a lift on the export ban a year ago, miners are reluctant to return to sapphire production.

In Sri Lanka, the government stopped issuing mining licenses to most miners and put a hold on many old contracts, citing environmental concerns. As a result, operational costs are higher, which miners are passing on in higher premiums for the sapphires they do produce.

Look out for more discussion of gemstone values on Lucie's blog.

To see all our Sapphire jewellery visit our website or visit us at 26 New Bond Street. We will be pleased to talk to you about the value of gemstones and to give you a new valuation for your Lucie Campbell jewellery.

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