MARKET INTELLIGENCE 市场情报 48 | JNA January/February 2024 The Provenance Proof platform, meanwhile, had some eight million coloured gemstones from over 700 companies in its blockchain as of September 2023, said Gübelin Gem Lab Managing Director Daniel Nyfeler. And the lab’s Emerald Paternity Test, which embeds traceable nano particles into rough crystals, is applied to more than 30 per cent of the annual production of high-end emeralds. Nyfeler said, “Though the Provenance Proof blockchain is free to use, the midstream has either not yet fully understood and embraced traceability initiatives or received sufficient pressure from the brands to provide traceable goods. Jewellery brands also may not know the number of traceable stones available in the market.” Blockchain platforms are also not exclusively confined to bigger players. Nyfeler cites as example artisans in a small mining community in Madagascar who polish coloured gem waste into beads that are sold to tourists. “Every single piece they produce is on the blockchain, though the value of their goods may be minute. All that is needed is a smartphone to register, take a picture and enter the information. That done, the stone has a digital twin on the blockchain,” he explained. Nyfeler conceded that full transparency and traceability would take time. But since the technology is available, implementation can speed up, especially if brands start requiring traceable goods. “Having over eight million gemstones on the blockchain is a promising sign. Despite the complex and fragmented value chain of the coloured gemstone sector, there is also a bottom-up effort to achieve greater traceability,” he said. Responsible practices For his part, Gemfields’ Gilbertson proposes that the players in the downstream focus on “mine of origin” rather than “country of origin” to boost traceability. At the CIBJO (World Jewellery Confederation) Congress in October 2023, the first after the pandemic, he shared Bank of Mozambique data indicating that prior to Gemfields’ ruby auctions, rubies were either smuggled or their value was under-declared. “Setting price at the point of export is wrong and has cost Africa to lose billions of dollars,” Gilbertson said. And during the Congress’ session on responsible sourcing of coloured gemstones, Jenna White from the Colorado School of Mines disclosed that most local miners in key mining locations in Africa prefer fair prices for their gemstones, instead of donations. Apprenticeship models also work best to develop cutting skills, rather than expecting trainees to meet international standards after short training periods, she continued. Next-gen customers Another major test – and opportunity – for the coloured gemstone market is nurturing demand among younger generations of consumers. Cody said, “The biggest challenge will be getting a share of mind of the new luxury buyer. The industry will need to build and maintain high levels of consumer confidence with this younger segment of new buyers.” Apart from highlighting responsible sourcing and sustainability initiatives, changing the narrative of coloured gemstones would help build emotional resonance among consumers, said Lotus Gemology founder and celebrated gemmologist and author Richard W. Hughes. “At Lotus Gemology, we tell stories to provide the human aspect to these wonderful things we work with. That is what the industry needs to do. It must stop focusing on numbers and technical descriptions and instead, focus more on the incredible beauty of each gemstone,” Hughes said. Cody admitted that storytelling should be an essential part of the sales pitch. “People do not remember facts and figures; they remember stories. Our industry deals in goods that are millions of years old. Each item is unique. We should ‘romance the stone’ and sell the idea of gemstones as works of art,” he remarked. For Sabbagh, exposure and education would help build a culture of coloured gemstones among younger generations. Inventories have fallen to low levels and, as prices stabilise, we can expect increased demand from all sectors of the market to rebuild stocks. – Damien Cody, president, International Colored Gemstone Association
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