Anup Jogani shares the dealer's perspective: What makes the distinction between fancy colored diamonds and colorless diamonds (white diamonds) so considerable?
The majority of interesting fancy colored diamonds - greens, pinks, blues, pinks, grays, and other colors - are exponentially rarer than white diamonds. The collector is more of an investor in the fancy colored market, as these unique types of diamonds represent the hallmark of rarity.
White diamonds are much more common because they’re in quite high supply, yet massive demand floods the market, so white diamonds profit from the supply-demand function largely through the demand pole. Fancy colored diamonds, on the other hand, surface on the market in comparatively minuscule quantities in a given year, and only a few major dealers control the fancy colored diamond trade.
For instance, vivid pink or blue diamonds and stones with purple tones or violet hues can be nearly impossible to find. The demand for fancy colored diamonds stems mostly from a few collectors, but the supply is microscopic. Demand has actually increased for fancy colored diamonds during the last twenty-five years, and even a small bump in demand sends prices sailing, producing a tenfold increase simply because a few more people desire these stones.
(A fancy red diamond from the Argyle Mine in Australia. Image Copyright 2017 by Rio Tinto.)
In terms of where fancy colored diamonds originate, a few sources supply these rare gems, but colored diamond mine discoveries are almost random. The Argyle Mine in Australia is one of the most prolific producers of pink diamonds. Brazil also renders an array of colors in very small quantities, which demonstrates the inconsistency associated with locating fancy colored diamonds.
Brazilian rough in particular is a bit haphazard because the rough coloring could be brown but then, upon polishing, the result is a pink diamond. Some blue diamonds crop up in Africa, especially hydrogen bearing stones, and the Golconda mine generated one of the most famous fancy colored diamonds on earth, the Hope Diamond.
With the Argyle Mine providing the most copious amounts of pink diamonds, when it shuts down and the demand for pink and blue diamonds increases, astronomical prices for those stones could follow. The prices for pink, blue, and red diamonds could even rise to mirror those of major art pieces.