Yahoo Finance: Why The ‘Trillions Of Carats’ Of Diamonds Found in Russia Will NOT Change the Price of Jewelry
Earlier this week, a story appeared in the Christian Science Monitor that reported that Moscow had revealed that it was sitting on an enormous amount of diamonds.
The news had a wild back story. Apparently first discovered in Siberia in the 1970s and kept secret by the Soviet government for decades, the diamonds were found under a “35-million-year-old, 62-mile diameter asteroid crater” that had resulted in diamonds “twice as hard” as normal diamonds, according to Russian new sources quoted by the CSM.
If that wasn’t crazy enough, the head of the Novosibirsk Institute of Geology and Mineralogy, Nikolai Pokhilenko, bragged about the value of the diamonds, telling Russian reporters about “trillions of carats” under the surface of Siberia. Pokhilenko even said that they would have enough diamonds to supply the global market for “3,000 years”.
The news invariably went viral, with one website saying that the diamonds could be worth $1 quadrillion at current market prices, and arguing that the find could cripple the market value of the gem.
Those in the diamond world were shocked. “Holy s—“, is how Dustin Chalchinsky, a geological specialist for Eurostar Belgium, one of world’s top loose gem companies, decribed his reaction. “This can’t be real. This is almost science fiction.”
Chalchinsky went on to write a comment on Reddit that explaining just how unlikely the asteroid scenario was. “It seems extraordinarily unlikely,” Chalchinsky told Business Insider in a phone interview. “But extraordinarily unlikely things do happen.”
Well apparently they do, but apparently there’s a catch. National Jeweler has been able to get in contact with Alrosa, the Russian mining giant, who confirmed that the huge diamond deposit really does exist. Unfortunately, the diamonds are not jewelry quality, a spokesperson for Alrosa said, and while they could feasibly be used for industrial purposes, they are located in an area without good infrastructure and it would not prove cost efficient to mine for them when low-grade, industrial-use diamonds can be made in labs more cheaply.
So yes, the story of “trillions of carats” of diamonds underneath an asteroid crater is a remarkable story. But no — it is not going to make your engagement ring any cheaper.
By Adam Taylor – Saturday, Sept 22, 2012