Blue Streak

RAPAPORT… Does supply drive the market? The answer seems to be “yes,” at least when it comes to fancy blue diamonds. Sotheby’s October 7 sale in Hong Kong was headlined by an 8.74-carat, emerald-cut fancy intense blue diamond expected to fetch $4.5 million. It did that and more, selling for $5.6 million. In spite of the auction achieving significant sales of $32,564,970, a total of 93 lots out of 318 failed to sell, making for an auction that was sold 70.8 percent by lot and 80.6 percent by value.

Beautiful Blue
The blue diamond, described by Quek Chin Yeow, head of Sotheby’s Asia jewelry department, as “very pretty and a pure shade of blue,” was also fresh to the market, coming from an Asian private collection where it had resided for more than 30 years. And Quek concluded, “Blue diamonds are getting scarce.” The blue set a record for a fancy intense blue sold at auction in Asia. It follows in the footsteps of other blues that reached high selling prices. This past May, Sotheby’s Geneva had its own blue success with a 7.03-carat stone described as “vivid” blue that sold for $9,488,754. By all accounts that stone was not as lively as the one that sold in Hong Kong. Unlike the Hong Kong blue, it was a newly mined diamond, from the historic Cullinan mine. In 2007, Christie’s London sold a 7.81-carat grayish blue diamond for $5.1 million, a world record price per carat for a blue diamond at that time.

In recent sales, other fancy color diamonds dominated the top ten list but in this sale, only one other managed that level of success: a ring set with a 9.05-carat, pear-shaped fancy light pink diamond, as well as two shield-shaped light blue diamonds, framed within other light blue diamonds, was sold for $848,720, midway between the high and low estimates.
 
Staying in the blue mood, an 18.08-carat Kashmir sapphire set in a ring was sold over the high estimate for $1.5 million. The intensely blue cushion-shaped stone set an auction record for a Kashmir sapphire in Asia. While blue diamonds are still being mined, it is unlikely that another Kashmir sapphire of this size and quality will come out of the ground. True rarity, once again, as well as extraordinary beauty, helped achieve this record price.

Homeland Buyers
Given the nervousness of the world economy, holding the first jewelry sale of the season could be cause for concern. But Quek says, “We were positive about this sale, given that the mood over the past months in Asia has been progressively upbeat, and reflective of both the stock and property markets.” To assure success, he says, the firm was very careful in putting the sale together, matching jewels, precious stones and diamonds to the market. The preparation certainly paid off, with the headlining blue diamond competed for by five bidders eager to take it home. Other lots also brought out multiple high bidders, proving the depth and strength of this market.

Nurturing clients from Mainland China has paid off for Sotheby’s Hong Kong, creating a new, enormous, moneyed clientele. Mainland China buyers figured prominently in the top ten lots, seven of which went to private clients — the other three remaining anonymous. For these clients, luxury goods across the board, including fine white diamonds, have enormous appeal. In this sale, the allure of a D flawless diamond weighing 28.88 carats also carried with it the magic of the number “eight,” considered very auspicious by the Chinese. The round stone was sold for $4,679,490, just over the high estimate.

Quek points out that “fine white diamonds, particularly round brilliant diamonds, are much less seen in the market today, and remain highly desirable.” Further, collectors worldwide view D flawless diamonds of more than 20 carats to be top investment stones. This thought was echoed in the sale of an 18.71-carat D internally flawless (DIF) diamond set in a ring that was sold for $2,238,460. A pair of pendant  earrings, suspending beautifully matched round diamonds, of 10.12 and 10.65 carats, respectively, brought $1,635,390, well over the high estimate.

Other important white diamonds also brought out the bidders, a sign once again of scarcity in the market. A 10.85-carat DIF pear-shaped diamond, designed to be suspended from a necklace or worn as a ring, sold over the estimate for $1,079,490. This lot, described as a type IIa diamond, was lovingly but vaguely linked in the catalog to the famed Golconda mine.  

Jadeite Fading
The number of jadeite lots in the Hong Kong auctions seems to diminish with the passing years. In this sale, jadeite numbered about one-quarter of the lots but the Chinese taste for jade remains an important component of the market. A necklace comprised of 29 jadeite beads, graduating in size from 10.86 mm to 17.73 mm, interspersed with diamond beads and a diamond clasp, was sold for $848,720, just under the low estimate.  

Among those items that failed to sell was the unusual cover lot, a rigid choker necklace set with a 9.45-carat faceted emerald and more than 100 carats of fancy colored diamonds, most of them pink. The piece was constructed to showcase pinks from the Argyle mine, and did not have the provenance or design heritage of many of the other lots in the sale. An exquisite diamond, ruby and peridot dragonfly brooch with plique-a-jour wings likewise failed to sell.

Several very unusual lots, however, caught the bidders’ eyes. A bib necklace in the Indian style set throughout with rough diamonds fetched $48,386, well over the high estimate. An exceptionally well-matched strand of 31 golden pearls with earrings was sold for $27,419, although a similar strand of white cultured pearls failed to find a buyer. A brooch of singular design and manufacture, with flower heads throughout with translucent, golden diamond plaques set en tremblant, was sold for $21,125, above the high estimate.