Dealers weigh in on sourcing, sales channels, and other colored-stone issues that have arisen during the pandemic.

Bill Gangi is keenly aware of how stone dealing has evolved during the Covid-19 crisis. When a longtime customer rang the owner of Gangi Gems about buying an opal last fall, he sent multiple pictures and videos before she was finally enticed to see the stone in person.

“We’ve changed from gem cutters to Francis Ford Coppola, making videos to sell our inventory,” he jokes. In a particularly challenging year, however, the sale was no laughing matter. The customer eventually bought the $800 gem, with Gangi conceding that he has to “get used to this new way of doing business.”

The pandemic has drastically changed the colored-stone market. Many major trade shows, such as the American Gem Trade Association (AGTA) GemFair Las Vegas, didn’t take place in 2020, while others scheduled for early this year were canceled. These include the 2021 AGTA GemFair Tucson and the Gem & Jewelry Exchange (GJX) show, which was due to take place in the Arizona city from February 2 to 7. Travel anywhere, in fact — especially to stone-producing countries — seems to be off the table, leaving many dealers, designers and retailers searching for solutions.

Aziz Basalely is among the grounded merchants. The founder of New York-based Eliko Pearl has taken monthly buying trips to Asia for more than 40 years, knowing that in-person shopping is the best way to bring home the top gems. Stripped of his ability to travel safely, he’s now finding his prowess as a go-to pearl expert being tested over email. “I get pictures of items on offer, but they’re very different when they’re right in front of you,” he says.

Gray spinels from Kimberly Collins
Gray spinels from Kimberly Collins.

Using what they’ve got
Today, gemstone dealers are working with old stock or shipped goods that they’ve only been able to eyeball online. Those with deep inventories include Gangi, Robert Bentley of the Robert Bentley Company, Azur McHugh of Azurz gems and minerals, and Jonathan Gad of emerald specialist Gad Enterprises. For sellers like these, buying up big lots of rough to cut over a long period of time is a strategy that’s paying off.

Gad spends his days cutting through the large production of Columbian emeralds he bought from the country’s Muzo and Cunas regions before the coronavirus hit. McHugh, meanwhile, is sitting on a sizable inventory of Siberian azurmalachite, Namibian blue chalcedony and American tourmaline.

Elsewhere, Bentley is making his way through a stockpile of Mozambique tourmaline. “When Mozambique Paraiba [tourmaline] came out of the ground, I had access to a strong inventory,” he explains. “A growing awareness of it has sustained me through Covid-19 times.”

Buying lots and rough from photos and videos is an unavoidable challenge during the ongoing pandemic. However, it’s virtually impossible to check clarity and color over messaging platforms like WhatsApp, according to Laurie Watt, cofounder of Kentucky-based dealer Mayer & Watt. Moreover, when packages arrive, scrutinizing the material itself is an exhausting process that frequently results in pricey returns. “We’ve had some parcels
that cost $800 to ship in and out,” she says.

Online pearl auctions have also proved disappointing, remarks Basalely, observing that as with colored stones, examining pearls in photos lacks the power that comes with perusing in person. With limited knowledge of what the goods actually look like, he adds, bids tend to be low — a fact that frustrates farmers. “The auctions just don’t lend themselves to an online format,” he says, citing one in which he participated without a successful purchase.

Colombian emerald with an AGL report of minor clarity enhancement from Gad Emeralds.
Colombian emerald with an AGL report of minor clarity enhancement from Gad Emeralds.

Mixed-up messages
The issues extend beyond coronavirus-related travel restrictions. Limited mining due to Covid-19 safety protocols has made obtaining quality material a major challenge.

Los Angeles-based jewelry designer and dealer Erica Courtney knows this firsthand. “If you see something you like, you’d better buy it, because it won’t be there later,” she advises.

A further problem is the myriad frantic stone dealers in source countries who have turned into online hawkers. Kimberly Collins, owner of Kimberly Collins Colored Gems, has fielded at least 20 messages from unknown dealers trying to sell her stones via WhatsApp — with one using the phrase, “Can you business me?” Others stalk her Instagram contacts, following friends, clients, and even her parents and son. When a client recently left a compliment on an image of a stone Collins had posted, a mystery dealer messaged them directly to say, “I give you cheaper price.”

Collins argues that these people don’t know who’s who.
“They’re just trying to get sales. Some even pose as my supplier,” she relates, adding that one consumer client of a store she sells to actually bought a stone from Pakistan that didn’t look anything like the pictures. Returning it simply wasn’t an option; “the dealer made it difficult.”

A similar but even more worrying trend is that reputable dealers in source countries are going direct to the consumer for sales, according to Sheahan Stephen, president of Sheahan Stephen Sapphires, who sources from Sri Lanka. The move is disrupting a business structure that has been in place for years: stones going from the mine to local buyers to US dealers to stores to consumers. There could be potentially huge consequences as US dealers get squeezed out, but there are also less-apparent implications for artisans in source countries.

Stephen’s business, for example, trains local sapphire miners and cutters, ensuring they get paid fairly for their skills. The stones he sells help fund his initiatives. When bigger dealers go straight to consumers, opportunities to help spread the message of Sri Lankan sapphires to broader audiences are lost. Prices could rise as well, he comments.

“When [reputable] dealers in source countries find consumers to buy stones directly, this pushes the prices up for when mining returns to normal,” he explains. It also leads to a lack of accountability from the sellers. “I’ve had consumers call me and ask, ‘Can you return this for me?’”

Alexandrite from Brazil from Gem 2000.
Alexandrite from Brazil from Gem 2000.

On the bright side
Difficulties aside, colored stones are still selling. The most popular rocks are holdovers from recent years: grey spinel, Montana sapphire, and large cuts of brightly-colored gems like hot-pink Mahenge garnet. Others of note include East African garnets, opals, emeralds, and stones with multicolor zones like peacock tanzanite and yellow-blue-green sapphire.

Brecken Farnsworth, cofounder of Parlé Jewelry Designs, says she can’t keep boulder opal in stock, while Shomais Shirazi, vice president of Gem 2000, continues to see demand for large, high-quality stones like alexandrite.

In pearls, bread-and-butter items are selling, although obtaining quality goods in general remains tough. Chinese pearl demand also continues to drive up prices across the board. Dealers who invested early in an online presence — such as social media, a strong website or an app with good photography — are reaping the rewards. Collins, for example, worked Instagram hard in 2020 and made a lot of sales. “That saved me,” she maintains.

Other dealers have benefited from a serendipitous jump in high-end jewelry sales, which is filling the gap left by the gem lovers who would have flocked to the Tucson shows. Affluent consumers who can’t currently travel are spending that money on dazzling adornments instead. “We call this pent-up demand the ‘Covid advantage,’” Watt says.

It’s an observation shared by Gad, who believes restrictions on the travel industry have led to an improvement in jewelry sales. Gangi agrees, adding that “the emotional connection to jewelry survives [even] when we can’t see each other.”

Main image: AGL-certified heated blue sapphire of Ceylon origin from Sheahan Stephen Sapphires.

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