Diamonds are known to cost an arm and a leg, and probably a kidney too. But how did they get here? How did diamonds get to the point of being sold for $71 million? (Yes, a diamond called the CTF Pink Star was sold for that mind-boggling amount in 2017).
Well, it’s simple actually.
The Rarity of Diamonds: Actual or Manufactured?
You might have heard the phrase ‘Diamonds are forever’. What you might not have heard is the origin of the phrase and how that origin explains why diamonds got so expensive and valuable in the first place, considering the fact that they aren’t so rare, which is what many people believe makes them valuable and expensive.
Diamonds are part of a quartet of jewels called precious stones, the other three being sapphire, emerald, and ruby. Fun fact; diamonds are the commonest when compared to the other three. So why on earth are they that expensive?
A bit of history is needed here; a diamond mine was discovered in the 18th century that threatened to make diamonds available to every Tom, Dick, and Harry when previously, diamonds were generally only available to noblemen and royalty and was widely considered to be a symbol of power, prestige and high status.
A company, De Beers then went and bought up the mine and limited the diamonds that were available, keeping the tradition of diamonds being scarce.
The phrase ‘Diamonds are forever’? is from the copywriting tagline, ‘A Diamond is Forever’ written by Frances Gerety in 1947 for De Beers. That tagline helped the company perpetuate a belief that diamonds are the only gemstones through which love can be expressed because just like true love, diamonds are forever.
As a result, a lot of couples worldwide desired to have a diamond ring as a symbol of their love, playing into the hands of the diamond company, who through clever and aggressive advertising created a gigantic demand for the stones that they met with a supply that was rationed.
There were people who wanted to buy diamonds, but there were not enough diamonds to go around. Voilà, scarcity was created, and anyone with a basic knowledge of Economics knows that resources are more expensive during scarcity.
So, diamonds aren’t as rare as we’ve been led to believe. They are simply rationed to keep the prices high.
Diamonds Cost a Lot and are Treasured Highly, Why?
Apart from the luster and beauty of the stones themselves, there are quite a number of reasons why diamonds remain expensive and valuable. We have earmarked for your convenience for five reasons why diamonds are so expensive and what makes diamonds so valuable.
1) Diamonds are expensive because they possess a meaning that has been cemented by time and beliefs.
2) The market demand for diamonds is very high.
3) Diamonds are a symbol of uniqueness and rarity.
4) The costs surrounding the mining and cutting of diamonds make them expensive.
5) The unparalleled durability and multiple applications of diamonds make them expensive and very valuable.
1) Diamonds are expensive because they possess a meaning that had been cemented by time and beliefs
The high value placed upon diamonds didn’t start today. Ancient Greeks also valued diamonds highly, believing it had special, mystic powers. They also highly esteemed its unmatched hardness. They passed down this knowledge and belief, and with humans, things and ideas that survive the fading effect of time are often seen as very valuable and consequently, expensive to buy.
The companies that mined diamonds understood this, and took advantage of it, making diamond rings the choice of over 80% of engaged females. A forerunner in that respect is Mary of Burgundy, who received a diamond ring for her engagement as far back as 1477.
2) The Market Demand for Diamonds is Very High
As earlier mentioned, the manufactured market demand is a key reason why diamonds are so darn expensive, and coupled with diamonds being the ultimate sign of prestige and wealth, their prices are unlikely to go down anytime soon.
3) Diamonds are a Symbol of Uniqueness and Rarity
Diamonds are made of pressurized carbons in layman’s terms. In actual terms, they are the result of pure carbon being under the right amount of pressure and the right amount of heat for a very long while. That very long while is the thing; a diamond can take anywhere between 1 billion years to 3.5 billion years to form and then be transported to close enough to the earth’s surface to cool whilst also making it available for mining.
In fact, the youngest diamond is about 900 million years old, and with such elongated times that diamonds require to be formed, it further drives home the point about them being jewels you can own and pass down to future generations as a family heirloom. Being able to own such a unique gem wouldn’t come cheap.
4) The Costs Surrounding the Mining and Cutting of Diamonds Make them Expensive
Diamonds are hard to mine, and when they eventually get mined, they don’t look anything like the beautiful winking gems on engagement rings. The diamond ore needs to be sorted, and sometimes it might take sorting through tons of ore to get a 1.00-carat diamond. After that, they still have to be cut and polished to really accentuate their luster.
Apart from the costs involved in mining diamonds (costs of tools, labor, etc) the cost of cutting them is also enormous. Diamonds can be cut into different shapes, with some popular ones being the oval cut or the princess cut. This also costs a lot, especially the round brilliant cut that is generally the go-to choice for engagement and wedding rings.
5) The Unparalleled Durability and Multiple Applications of Diamonds Make them Expensive and Valuable
Diamonds look brilliant and beautiful, but looks are not all this gem has to offer. Outside the jewelry world, they have diverse applications in different industries. For instance, they can be used in making the drill bit parts of drilling equipment; they can be used to conduct heat (they do this about 4-5 times faster than copper), etc.
With these levels of application, coupled with their use in engagement and wedding jewelry, it isn’t that difficult to see why diamonds are so expensive, even if we wished they were not.
The valuable nature of diamonds is something that will always exist as long as the stones exist, alongside the demands for the stones. It’s hard to deny the brilliant and dazzling luster of the stones and their appeal as THE stone to give to your lady as a symbol of your love for her. After all, diamonds are forever, and they are a girl’s best friend.