I don’t have any argument about the need for a price list. The need for a price list is well preserved. This is what the industry has been used to. My main concern is – what is the basis of this price list. The basis of the benchmark (per carat price) that is unknown, far from the eye and not transparent is not something that can be relied up Lior eshed, Eshed DiamondsThere is very less information on how diamonds were traded in the pre Rap List era. All we know is that handshakes were made based on price per carat and a general worthiness of the stone. However, since 1978, the year Rapaport Diamond Index was established, the way diamond industry functioned changed overnight. A weekly price list (which has now become monthly) generated keeping the actual asking prices as a baseline for top-quality one-carat stones became an industry standard. Manufacturers, wholesalers, dealers and retailers everywhere in the world have been using this proverbial list to buy and sell their goods. You would be hardpressed to find a dealer who does not have the bright red Rapaport price list on his workstation.

So, since the late 70s – early 80s, the industry has been following a set international price for diamonds (Rap List), something that the colour gemstone industry has not been able to replicate. Agreed, adopting a benchmark has helped bring in more transparency in the pricing system and garner more consumer confidence but not without a tradeoff – what is supposed to be eternally rare and valuable has been commoditized so to speak. Gold as a commodity has also been following a market price, but while every ounce of gold is the same, no two diamonds are the same. The Rap List, since its inception has posed two problems – one, it generates its prices based only on carat, colour and clarity, but diamonds are beyond those parameters of grading, there are other intrinsic values in a diamond. Anybody who has been in the industry long enough would know that different diamonds of the same grade can look very different. The second and more prominent problem with the Rap List, something that most dealers resonate with is the monopoly and controlling of diamond prices for several decades. When the Rap List alters, it impacts diamond prices all over the world. Rap List, which is also presumably based on the simple economic law of supply and demand, decided to drop the prices recently, when there was absolutely no business happening around the world, which led to the industry’s furor. A benchmark price list that has had the ability to make or break businesses with its decision to alter prices based on a methodology that has hitherto been ambiguous, has led many to reflect on the problems associated with the current system and a fair way of arriving at benchmark pricing.