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Questions from Cut Nut''s Diamond Cutting webinar

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Garry H (Cut Nut)

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Someone asked what % of stones from a certain factory are H&A''s.

Out of 897 round stones listed on their site, 430 are listed as H&A''s = 48%

(I do not buy and promote H&A''s because I am yet to see a benefit, i simply reject stones below a certain level of Ideal-scope symmetry - so there fore I am not in the habit of looking at the H&A''s standards of many vendors - but my guess might be that 1/2 the stones might = the standards that would be acceptable here).

Now I know there were other questions raised too - please post them here or start seperate threads and I will do my best.

BTW my next Webinar could be based on the Diamond Pipeline. I would outline an overview and then look at the dynamics and geography etc of each level.

It could be based on this chart from IDEX.

Let me know if that sounds interesting and I could aim for say next Monday evening - say around 8pm EST - then I do not clash with wink or anyone else. And it would allow folk at home to tune in.

Of course if everyone''s fav TV program is on then, or the Presidento has a fire side chat scheduled.......

Diamond Pipeline Idex 2005.JPG
 

strmrdr

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How common are the advanced tools at the cutting houses?
Are most of them using them or doing it the old fashioned way?
 

Garry H (Cut Nut)

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Date: 1/18/2007 1:30:35 AM
Author: strmrdr
How common are the advanced tools at the cutting houses?
Are most of them using them or doing it the old fashioned way?
Over the past decade tchnology has led to the growth of adopters at the expense of the cottage industry and old timers.
One Director of a large Indian firm cutting from .30ct to 5ct stones of godd to better qualities told me their average yeild went from under 30% to over 40% during the 15 year period as they moved from outsourcing to take home cottage workers (where children would also help out) to bringing the best of the workers into 10 storey factories with networked computer aided equipment.

Consider India - they were the cutters of the smallest rubbish 15 years ago - but because they are the best technology adopters as we can see in Sarin''s breakdown - a public company now so we can see their figures http://www.listedcompany.com/ir/sarin/misc/ar2005.pdf - India has now started to take a bigger share of the single certified stone market.

Acording to IDEX India gets 59% by value of all rough - and probably 90% by weight - but they export around 70% by value because although they get the cheaper end of the rough - they add more value. And the reason they can do that is they get the harder to work, more heavily included, off shape rough. so the better you are in planning that stuff - the more you grow and the better the margin.

So no, more and more diamonds are being cut with better and better technology - but this is more true for the cheaper +.50ct rough than it is for easy to plan perfect 10ct octahedra which are more likely to be cut by dumb happy old fashioned cutters who need no technology.

Sarin 2005.JPG
 

Garry H (Cut Nut)

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Here is a scanned polsihed stone from Helium Rough scanner with the data seen in Oxygen.
Note that the inclusion has nbeen auto plotted and is about a VS2 and is near the center lower area - like a stone I had a sketch of in my presentation today.

Note now the black reflections of the inclusion that show all around the edges of the table.

DiamCalc inside Oxygen can actually grade the clarity of this diamond according to the micron size and shade and reflections of the inclusion as seen from face up in the stone.

Kewl?

V3ct polished.jpg
 

strmrdr

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kicken
 

Paul-Antwerp

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Date: 1/18/2007 2:12:21 AM
Author: Garry H (Cut Nut)

Over the past decade tchnology has led to the growth of adopters at the expense of the cottage industry and old timers.
One Director of a large Indian firm cutting from .30ct to 5ct stones of godd to better qualities told me their average yeild went from under 30% to over 40% during the 15 year period as they moved from outsourcing to take home cottage workers (where children would also help out) to bringing the best of the workers into 10 storey factories with networked computer aided equipment.
Such a ''hearsay''-comment should be used with qualification, Garry. There are very important factors that lead to such a change, which this Director and hence you fail to mention. Here are some:

1. Switching of stones is very common in sub-contracting. The concept of growing diamonds in this way is a classic. As a subcontractor, you buy 100 stones of 0.03 Cts. Next delivery of your subcontracting, you keep 100 stones of 0.04 Cts for yourself, and deliver the 0.03 instead. Next day, you turn the 0.04 into 0.05. Before you know it, you own 100 stones of 1Ct. In the old days, this took time, but with modern technology of spreadsheets, planning and various sizes in your factory, you could theoretically do the whole procedure in one day.

The owner of the goods suffers in a lower yield, but this is basically undetectable for him. By moving to his own factory, the control changes and this switching becomes much more difficult, hence a much higher yield.

2. For the owner of the goods, when giving stones to a sub-contractor, he does not care how difficult or inefficient it is to cut a part of a parcel. He pays per carat rough, and he does not care, whether 10% of the parcel only yields 8% and takes 10 times as much effort to cut. In his own factory however, efficiency counts, and rough will be better sorted before production, with the inefficient part not being cut and sold to other cutters with other cost-structures. By rejecting beforehand the part with the lowest yield, your own average yield will jump, without any change in the overall knowledge, efficiency or anything.

This also classic smokescreen is often used in nowadays factories still, where the owner is for instance in Belgium and the factory in for instance China. The factory manager, who receives a parcel will reject as much as possible as ''uncuttable''. We would call that ''rejection''. The rest will be cut and will achieve a higher yield, say 46% in stead of 44%. Every once in a while, all the rejections go back to say Belgium, and the owner will either sell them (without checking, the stupid fool) or he will sort them, and say that 30% will still be cuttable. By then, nobody will care about the yield of those anymore, since it is rejections being cut. So, if they yield 25%, that is OK. But if these would have been cut immediately, the average first yield would have been a lot lower, and the factory manager would be under much tougher control.

This smokescreen is currently also used in a major company, with mining and retailing. The factory receives the original rough, and has to select the stones, that are suitable for the desired quality of the retailer. Of course, they only select the stones, that are easy to cut, and give a high yield, because it makes their life easier and they can brag about a high average yield, compared to industry standards.

3. For sure, in this period of 15 years, the average quality of rough produced has also changed, and looking at the trend, it has probably improved.

All these aspects, and probably many more are hidden in the quote of your Director.

Unfortunately, because of time-difference, I could not join your webinar. Sorry.
 

Garry H (Cut Nut)

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it would have been good to have you Paul as Bill Brae was there and added some value too as a ''real'' expert


The gentleman concerned is no fool, and had no reason to pull the wool over my eyes. He is infact one of the super smart numbers men and very respected for his intellect. You would know him and agree.

He explained that they were getting always 2-4% better yeilds from their factory compared to out workers on like for like rough. So their plant went from low 30% to 43% while the out workers were chopped off at about 35%.

But I agree - there has always been a rough market for trading down in Surat.
 

pyramid

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I think strmrdr brought up at the seminar about using the cutting technology to cut stressed stones and we were hoping that Rockdoc may get involved in a discussion on the forum. Also the disadvantage put by AGS wanting the perfect numbers and it being hard because of the grain. I don''t know if Strm is still intending to bring this topic up?
 

Garry H (Cut Nut)

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Date: 1/18/2007 4:53:59 AM
Author: Pyramid
I think strmrdr brought up at the seminar about using the cutting technology to cut stressed stones and we were hoping that Rockdoc may get involved in a discussion on the forum. Also the disadvantage put by AGS wanting the perfect numbers and it being hard because of the grain. I don''t know if Strm is still intending to bring this topic up?
I will start a new Stress thread Pyramid. I have also asked some leading researchers in the industry to consider doing some research on the topic.

Re AGS''s policy on strict adherence to Ideal Sym and Polish - It could be discussed here.

Paul and Brian / JohnP can comment too?

The idea is that achieving top sym and polish on square stones that are likely to have facets that can be close to the octahedral plane means they are hard to achieve a great polish on - and sometimes to make the facet run the cutter must tilt the stone away slightly - and this can ruin the symmetry.
Either way it seems silly to impose a rule that is more easily achieved in a round stone on to shapes where the degree of difficulty can be orders of magnitude higher, and the visible impact is less than negligible.
 

diagem

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Date: 1/18/2007 2:12:21 AM
Author: Garry H (Cut Nut)

Date: 1/18/2007 1:30:35 AM
Author: strmrdr
How common are the advanced tools at the cutting houses?
Are most of them using them or doing it the old fashioned way?
Over the past decade tchnology has led to the growth of adopters at the expense of the cottage industry and old timers.
One Director of a large Indian firm cutting from .30ct to 5ct stones of godd to better qualities told me their average yeild went from under 30% to over 40% during the 15 year period as they moved from outsourcing to take home cottage workers (where children would also help out) to bringing the best of the workers into 10 storey factories with networked computer aided equipment.

Consider India - they were the cutters of the smallest rubbish 15 years ago - but because they are the best technology adopters as we can see in Sarin''s breakdown - a public company now so we can see their figures http://www.listedcompany.com/ir/sarin/misc/ar2005.pdf - India has now started to take a bigger share of the single certified stone market.

Acording to IDEX India gets 59% by value of all rough - and probably 90% by weight - but they export around 70% by value because although they get the cheaper end of the rough - they add more value. And the reason they can do that is they get the harder to work, more heavily included, off shape rough. so the better you are in planning that stuff - the more you grow and the better the margin.

So no, more and more diamonds are being cut with better and better technology - but this is more true for the cheaper +.50ct rough than it is for easy to plan perfect 10ct octahedra which are more likely to be cut by dumb happy old fashioned cutters who need no technology.
Sounds about right...
about 10 years ago i was involved in a test try-out with a major Indian sightholder.
We both (the indian Co. and me not from India) purchased numerous large parcels of ''speculative'' rough diamonds for manufacturing.
The parcels were based on an average size of 5 carats, and irregular shaped rough for cleaving and sawing.
The test was that both me and the Indian Co. split the parcels in half resulting in two cuts of each parcel, one cut was manufactured in India and one cut was manufactured by me.

The results back then was: the amount of monetary loss made by the Indian Co''s part was fully recovered by my manufacturing and we came out approx. even.
The polished that came out from India was substantially larger in weight than the outcome from my manufacturing.

I am in serious doubt that this result would duplicate itself these day''s.
 

Garry H (Cut Nut)

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Date: 1/18/2007 5:35:48 AM
Author: DiaGem

Date: 1/18/2007 2:12:21 AM
Author: Garry H (Cut Nut)


Date: 1/18/2007 1:30:35 AM
Author: strmrdr
How common are the advanced tools at the cutting houses?
Are most of them using them or doing it the old fashioned way?
Over the past decade tchnology has led to the growth of adopters at the expense of the cottage industry and old timers.
One Director of a large Indian firm cutting from .30ct to 5ct stones of godd to better qualities told me their average yeild went from under 30% to over 40% during the 15 year period as they moved from outsourcing to take home cottage workers (where children would also help out) to bringing the best of the workers into 10 storey factories with networked computer aided equipment.

Consider India - they were the cutters of the smallest rubbish 15 years ago - but because they are the best technology adopters as we can see in Sarin''s breakdown - a public company now so we can see their figures http://www.listedcompany.com/ir/sarin/misc/ar2005.pdf - India has now started to take a bigger share of the single certified stone market.

Acording to IDEX India gets 59% by value of all rough - and probably 90% by weight - but they export around 70% by value because although they get the cheaper end of the rough - they add more value. And the reason they can do that is they get the harder to work, more heavily included, off shape rough. so the better you are in planning that stuff - the more you grow and the better the margin.

So no, more and more diamonds are being cut with better and better technology - but this is more true for the cheaper +.50ct rough than it is for easy to plan perfect 10ct octahedra which are more likely to be cut by dumb happy old fashioned cutters who need no technology.
Sounds about right...
about 10 years ago i was involved in a test try-out with a major Indian sightholder.
We both (the indian Co. and me not from India) purchased numerous large parcels of ''speculative'' rough diamonds for manufacturing.
The parcels were based on an average size of 5 carats, and irregular shaped rough for cleaving and sawing.
The test was that both me and the Indian Co. split the parcels in half resulting in two cuts of each parcel, one cut was manufactured in India and one cut was manufactured by me.

The results back then was: the amount of monetary loss made by the Indian Co''s part was fully recovered by my manufacturing and we came out approx. even.
The polished that came out from India was substantially larger in weight than the outcome from my manufacturing.

I am in serious doubt that this result would duplicate itself these day''s.
That is a great story DG
 

CaptAubrey

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A good thread, and an illustration that no matter how long you''ve been in this business, there are still things to learn.
 

diagem

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Date: 1/18/2007 6:49:24 PM
Author: CaptAubrey
A good thread, and an illustration that no matter how long you''ve been in this business, there are still things to learn.
Oh yea, you can allways learn more (there is no limits!!!)
Especially in this industry..., after all this industry is still manuvered in a very PRIMITIVE fashion....
 

starryeyed

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Date: 1/17/2007 11:51:20 PM
Author:Garry H (Cut Nut)
BTW my next Webinar could be based on the Diamond Pipeline. I would outline an overview and then look at the dynamics and geography etc of each level.
It could be based on this chart from IDEX.
Let me know if that sounds interesting and I could aim for say next Monday evening - say around 8pm EST - then I do not clash with wink or anyone else. And it would allow folk at home to tune in.
Of course if everyone''s fav TV program is on then, or the Presidento has a fire side chat scheduled.......
Hi Garry. Thank you so much for the excellence you add to the webcasts. You are a wealth of information. The pipeline idea sounds great! I''m definitely interested in that. These webcasts are better than TV. Shall I pencil it in?
 
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