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Is the Jewelry Auction Market Headed for a Downturn?

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By Anthony DeMarco

For at least the past year, blue diamonds were all the rage. And since the global economic downturn of 2009, the jewelry auction market has been scorching hot. However, the auctions in New York in April may have signaled an end to both of those trends.

The big news was that the much-hyped and anticipated sale of the Shirley Temple Blue Diamond failed to find a buyer at Sotheby’s New York Magnificent Jewels sale on April 19 despite plenty of publicity prior to the sale. The Fancy Deep Blue, Potentially Internally Flawless, VVS2 clarity diamond was owned by the child actress and American diplomat throughout her life. It had an estimate of $25-$35 million.

Shirley Temple Blue Diamond, photo courtesy of Sotheby’s. The top bid was $3 million below the low estimate of $25 million.

Shirley Temple Blue Diamond, photo courtesy of Sotheby’s. The top bid was $3 million below the low estimate of $25 million.



A reason why the Shirley Temple diamond may not have sold was that despite its provenance it may not have been up to snuff with the other statement blue diamonds that have commanded astronomical prices, many because it was not graded as a “Vivid” blue diamond. The reserve may have been set too high as well, since the top bid was only $3 million below the low estimate.

The Shirley Temple Blue Diamond is the second important blue diamond to come to auction since the November 2015 world record sale of the “Blue Moon of Josephine,” which fetched $48.4 million and peaked interest in statement blue diamonds. The De Beers Millennium Jewel 4 sold earlier in April at Sotheby’s Hong Kong for $31.8 million. So there was good reason to believe that the Shirley Temple Blue would earn a similar price.

Bidding on the Shirley Temple Blue Diamond. Photo by Anthony DeMarco.

Bidding on the Shirley Temple Blue Diamond. Photo by Anthony DeMarco.



Now there is one more statement blue diamond, which I think is the best of them all. The 14.62-carat “Oppenheimer Blue,” the “largest and finest Fancy Vivid Blue diamond ever offered at auction,” according to Christie’s auction house, which is offering the gem as part of its May 18 Magnificent Jewels sale in Geneva. The estimate of $38 – $45 million for the rectangular-shaped gem falls within striking distance of the Blue Moon of Josephine.

The Shirley Temple Blue was the last item of Sotheby’s disappointing New York sale of 300 lots that took in just over $29.8 million—less than half of what Sotheby’s New York April 2015 auction achieved. Many items went unsold and several times it seemed as if they were pulling items from the sale quickly in order to get to the Shirley Temple Blue, which turned out to be the ultimate disappointment.

Kashmir sapphire, 8.07 carats, unsold, had an estimate of $400,000-$600,000. Photo courtesy of Bonhams.

Kashmir sapphire, 8.07 carats, unsold, had an estimate of $400,000-$600,000. Photo courtesy of Bonhams.



Along with blue diamonds, Kashmir blue sapphires have been commanding high prices. But at Bonhams New York April 18 sale, two “exceptional” Kashmir blue sapphires went unsold. The auction’s top lot, an 8.07-carat sapphire on a ring with diamonds had an estimate of $400,000 – $600,000; and a 3.49 sapphire from Black, Starr & Frost, billed as America’s oldest jeweller with an estimate of $250,000 – $350,000.

So what were buyers interested in? A 15.99-carat Burmese ruby, known as the “Jubilee Ruby,” fetched more than $14.1 million at Christie’s New York Magnificent Jewels sale, the most expensive coloured gemstone ever sold at auction in the U.S.

But even this wasn’t an easy sale.

The Jubilee Ruby sold at Christie’s for $12.5 million, just above the low estimate.

The Jubilee Ruby sold at Christie’s for $12.5 million, just above the low estimate.



The price for the gem—set in an 18k gold ring within a circular-cut diamond and polished gold surround designed by Verdura—includes auction commission and fees. The hammer price was $12.5 million, on the low end of its $12 to $15 million estimate.

Bidding for the gem began at $10 million and those inside the mostly filled saleroom turned quiet while Rahul Kadakia, Christie’s International head of Jewellery, coaxed a few phone bidders slowly past the low estimate.

Christie’s was the winner among the auction houses for the week. The statement ruby was the last of 255 lots that took in more than $57 million and was one of nine lots that fetched more than $1 million, with all of the remaining top lots being diamonds. However, even with this success a number of lots went unsold.

Black Starr & Frost Sapphire Ring, unsold, estimate of $250,000-$350,000. Photo courtesy of Bonhams.

Black Starr & Frost Sapphire Ring, unsold, estimate of $250,000-$350,000. Photo courtesy of Bonhams.



It’s difficult to determine why so many items went unsold. The most common reason cited is that the austerity measures in China coupled with the country’s recent slowdown has had a negative impact on the marketplace as a whole.

Whatever the reasons, the Geneva auctions in May have taken on a new level of importance.

Anthony DeMarco is a freelance writer and editor who covers the luxury jewelry and watch industry for several publications, including Forbes.com the Financial Times, Hong Kong-based JewelleryNetAsia and the Italian jewelry magazine, VO+. He also has a blog covering the jewelry and watch industry, Jewelry News Network.

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