Wonder

Research Outline

Prepared for Davis Y. | Delivered February 29, 2020

Diamond Cutting and Polishing Costs

Goals

To determine the cost (price range) of the process of cutting and polishing diamonds weighing 10K-20K upon completion, specifically for brilliant round, cushion, and emerald cuts.

Early Findings

Nearly 80% of all rough-cut diamonds pass through the city of Antwerp, Belgium.
Of these rough diamonds, 92% eventually end up in Surat, India, where they are cut and polished. 
The brilliant round cut diamond accounts for over 70% of the world's polished diamond inventory.
Brilliant round cut diamonds require the most precision cuts and are, therefore, the most expensive polished diamonds to both produce and purchase.
Emerald cut diamonds are much simpler in design, making the cutting and polishing processes simpler and less expensive for cutters and consumers.
The cost of cutting a diamond, in general, varies by location. 
The average cost of cutting and polishing a rough diamond in India is $10 per carat; in China, it is $17 per carat and in Africa, it is $50 per carat.
Using these amounts, the average cost of cutting and polishing a rough diamond in India, not taking cut style into consideration, ranges from $100 for 10K to $200 for 20K.  The average cost of cutting and polishing a rough diamond in India, not taking cut style into consideration, ranges from $170 for 10K to $340 for 20K.  Finally, the average cost of cutting and polishing a rough diamond in Africa, not taking cut style into consideration ranges from $500 for 10K to $1,000 for 20K.
Waste 
The amount of rough diamond lost (called waste) through cutting and polishing varies by type.
Brilliant round cut diamonds lose about 60% of the total rough cut diamond as they are cut and polished. Once removed from the rough diamond, the removed parts are not suitable for any other use and become waste. 
Cushion cuts result in only a small percentage of the rough diamond being lost as waste during the cutting and polishing processes. They are one of the most affordable cuts. 
Emerald cuts, like cushion cuts, result in only a small percentage of the rough diamond being lost during processing. 
Summary of the Findings Relevant to the Research
During our first hour or research, we were able to provide some mainly general information on the costs associated with cutting and polishing rough diamonds. We were able to determine that while the cost of diamond processing varies wildly when it comes to cutting and polishing diamonds, India has a population and knowledge level that allows it to keep costs significantly lower than other counties.  We were also able to find waste information for one cut, the brilliant round, but not for the others. Our first hour of research led us to determine that most of the information about diamonds that is available to the public deals with the final price of the polished diamond. Some mentions of markups were provided in various sources, but they were primarily jewelry stores or retailers and the markups varied greatly. We searched for diamond industry, gem industry, and jewelry industry publications that may provide this information and found that many of them require memberships or subscriptions. The ones we were able to access provided tips on how to judge a good diamond but not on the prices associated with each step of the process of cutting and polishing a rough diamond.