Rubies Are Red-Hot Right Now – and Expensive

Gem-quality rubies keep getting pricier and harder to find. Dealers weigh in on why they don’t expect this situation to change.

October 9, 2024  |  Jennifer Heebner
Rough rubies mined by Fura

Anyone in the industry who’s wondering why ruby prices continue to rise need look no further than rough-ruby auctions and the scarcity in overseas markets. Gemfields’ rough auction this past June garnered the mining firm’s highest per-carat sum to date — $317 — while dealers who routinely travel to Bangkok, Thailand, to source goods often come home disappointed.

“There’s a lot of demand and not enough supply,” says William Hakimi of New York-based ruby dealer A. Hakimi & Sons. “Anything over 3 carats [in gem quality] is not easy to find.”

Image of Ruby and diamond engagement ring by Ashley Zhang
Ruby and diamond engagement ring by Ashley Zhang. (Ashley Zhang)

Supply and demand

A large part of the problem is that ruby sources in the world are limited. While there’s continuous production of diamonds and sapphires, ruby mining happens only when pockets are found, dealers say. In the 1960s and ’70s, Thailand and Cambodia were major ruby sources, but eventually they dried up. So did other locations like Kenya and Malawi. Extremely few goods come out of Burma (Myanmar), and Greenland Ruby recently shuttered its operations and put the business up for sale.

This leaves Mozambique as the major producer for now, but it’s hard to know how long the mines will last. Gemfields’ production of high-quality ruby in the last six months was “lower than expected overall,” according to Adrian Banks, the miner’s managing director for product and sales.

Image of Sarah Ho ring with a 17-carat ruby
Sarah Ho ring with a 17-carat ruby. (Sarah Ho)

“We are optimistic that this will pick up again,” she says. “The nature of colored-gemstone mining is that yields are by no means guaranteed, and it
is normal for gem deposits to have patchy distribution, particularly in secondary alluvial or colluvial deposits, which is where we tend to find the higher-quality gems.”

Meanwhile, luxury brands have leaned heavily into fine-jewelry production, and diamantaires whose inventory value has plummeted are also selling color. These developments further drive up demand and prices in an already competitive landscape. It’s a trend that mining company Fura Gems has noticed, says global marketing and communications director Gianluca Maina. Established dealers have taken notice as well.

“Before a ruby is even mined, there’s a demand for it — especially pigeon’s blood color,” says Jack Abraham, whose eponymous firm deals in the Big Three precious gems.

Mozambique in the limelight

Gemfields and Fura are the major mining operations for ruby at present. Both have mines in Mozambique. Dealers have fallen hard for these east African rubies, which are more abundant and less expensive than Burmese goods. Plus, last year’s Sotheby’s sale of the Estrela de Fura— a 55.22-carat, unheated, pigeon’s blood ruby from Fura’s Mozambique mine — helped put the country’s goods on a pedestal for the world to appreciate.

“Mozambique goods are nicer and cheaper, and Burmese rubies are not really available,” comments Hakimi.

Sailesh Lakhi of gem dealer Sparkles and Colors USA thinks Burmese rubies are “the best in the world,” but laments that “with no mining and [with Myanmar under] military rule, there are few coming out of the country.” Lakhi’s ruby inventory varies, ranging from 20% to 35% of his total gemstone stock, and most have no heat.

Image of Gemfields’ Montepuez ruby mine in Mozambique
Gemfields’ Montepuez ruby mine in Mozambique. (Gemfields)

While there are some sporadic sources of ruby — such as Madagascar, Kenya and Tanzania — as well as older stock from Thailand and Tajikistan, most of what dealers sell is from the Gemfields and Fura mines in Mozambique.

“About 99% of the rubies sold in the market are from their rough auctions,” says Afshin Hackman of Intercolor USA.

Fellow stone dealer Jeremy Hakimi of Colorline affirms this. “No one is really digging anywhere else for rubies,” he says.

Even for Gemfields’ Banks and her buyers, the struggle with shortages is real. “While the rise of Mozambican rubies over the past decade has been remarkable, there has been a lack of significant production of fine-quality rubies from other sources,” she says.

Finding the “super-fine” gems that the top 1% covets is even harder. “Gemfields’ Montepuez mine will process around half a million tons of ruby-bearing gravel in a six-month period, yet only a handful of these larger super-fine gems will be recovered,” she reveals.

Raising the bar

Before the large mining outfits established themselves, the industry bought from individual miners and waited years to have enough matched goods to make layouts. That process has since been streamlined, but it comes with a cost.

The two leading miners hold auctions to sell their rough, and the bidding is always sealed. This virtually guarantees that bids are high, because everyone wants to get their hands on what limited stock is available. That’s why the price per carat for lots at Gemfields’ June auction was nearly 10% higher than at the auction six months earlier.

Banks marvels at the demand. “The increase in ruby supply has led to increasing demand and prices, as there is greater confidence in the general availability of rubies,” she explains. “There’s a reason rubies are called the ‘king of gemstones.’”

Image of a diamond and ruby bracelet by Graff
A diamond and ruby bracelet by Graff. (Graff)

And every time rubies sell in the trade, the replacement costs are immediately higher. At press time, Abraham had just sold three rubies under 3 carats and received a call for another. In that time, his restocking price went up 15%.

Fura’s Maina is well acquainted with the struggle to obtain larger ruby sizes.

“At our Fura Mozambique ruby mine, the majority of rubies are under 2 carats in the rough,” she explains. “Given this, the number of rubies that can be cut into a 3-carat polished gem is quite small. The availability of 5-carat super-fine gem-quality rubies is even more limited.”

And if the rough buyers are paying more, so are their clients. “Those price increases get passed along every step of the way,” says Colorline’s Hakimi.

‘Much rarer than diamonds’

None of this surprises Lakhi, who insists that ruby commands the highest price per carat of any gem: “Ruby was, is, and will always be [in that top spot] — no other stone can come close.”

William Hakimi has seen ruby prices spike 30% in the past year. Intercolor’s Hackman has seen similar increases. And the bigger the ruby, the bigger the price increase per carat.

Image of ruby earrings by Ruth Tomlinson
Ruby earrings by Ruth Tomlinson in 18-karat gold. (Ruth Tomlinson)

“A 10-carat ruby is anywhere from 40% to 50% more per carat than a 9-carat,” Hackman says.

On top of that, remarks Abraham, “if you sell an 8-carat ruby, go find another one as good. They’re much rarer than diamonds.”

Banks quotes 17th-century French gem merchant Jean-Baptiste Tavernier, who “claimed that ‘When a ruby exceeds 5 carats and is perfect, it is sold for whatever is asked for it’ — words that remain relevant today.”

Main Image: Roug rubies mined by Fura. (Fura)

This article is from the October-November 2024 issue of Rapaport Magazine. View other articles here.

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