The Continuing Quest for a Universal Pearl Grading System
By Sharon Elaine Thompson

“Equilibrium,” a bracelet of white and yellow gold, beryl and Tahiti cultured pearls, the second prize Tahitian Pearl Trophy winner for 2005. Designed by Ana Bouissou and sponsored by Manoel Bernardes.

As we saw in the July 2006 print issue of Lapidary Journal, “Beguiled by Their Beauty,” pages 29-34, members of the cultured pearl industry want to unite as one but, when it comes to a common pearl grading system, they remain divided.

Producers and dealers for each category of pearl -- Akoyas, South Seas, Tahitian and Chinese freshwater pearls -- have put a great deal of time and money into promoting special characteristics of their own products. Akoya producers emphasize the luster and roundness of their classic product. South Seas producers argue that their pearls' luster is just as good as that of the Akoyas, their size is bigger, their nacre is thicker, their shapes more interesting. Tahitian producers focus on their product's unique color, overtone and size. Dealers in high-end freshwater pearl producers, point out that their naturally colored pearls are all nacre and so are more durable. Dealers in lower end goods may emphasize size and price point. And, explains Marc Freeman of Freeman Gem in Los Angeles, California, freshwater pearl producers can argue that round freshwater pearls are rarer than the round Akoya pearls that get their shape from the round bead nucleus inside them.

You can't get a standard system out of something that is so variable,” says pearl appraiser Lois Berger, G.G., and member of the National Association of Jewelry Appraisers (NAJA), who works with Martin Fuller and Associates in McLean, Virginia.

While some retailers and wholesalers see a single grading system as a door to educating the public about pearl types and qualities, for many dealers, a single system of grading pearls would, by its existence, imply that all pearls are equal. Worse, they fear that a universal system might appear to elevate one type of pearl over the others. And that is something that none of the producers are willing to accept -- or risk, as it might mean losing their product's identity, their marketing edge. Nor are dealers and growers confident that a pearl grading system can be applied consistently by anyone -- lab or retailer -- who does not handle a large number of pearls every day. And dealers of bead nucleated pearls are wary of what Chinese production -- either mantle tissue or bead nucleated -- might do to their market share and the value of pearls in general. Whether or not these concerns are insurmountable obstacles in the path of the development and acceptance of a universal system, only time will tell.

“I'm convinced that people will disagree [about a grading system],” says Armand Asher, of Albert Asher Pearls in New York, and immediate past president of the Cultured Pearl Association of America. “Some will say, `I don't believe it would help,' and others will say, `I believe it would hinder'.” And in that simple statement may lie the future of a universal grading system.

Pendant with Tahitian pearls, white gold and diamonds by Arnd Böcking, Germany, Tahitian Pearl Trophy winner, 2002.

THE SYSTEM
Wading into the fray, the Gemological Institute of America (GIA) has spent the last five to six years working closely with pearl producers to develop a pearl grading system they believe will address everyone's concerns. (GIA's original grading system was geared toward Japanese Akoya cultured pearls, which at that time, for the most part, was the only game in town.) Tom Moses, senior vice president of GIA's Laboratory and Research, says “We're very close to having a system that will effectively address all these categories. We did set up one system of nomenclature for all the types.” However, even as Moses says that he believes the single system they have developed is “an admirable approach,” he admits that “it doesn't always fit.” And, at least for now, most of the people we talked to expressed doubt that the GIA system will be accepted and used in the pearl industry.

“Different vendors ... have their own systems and they are all different,” says Berger. “They are not going to use the GIA grading system.”

“GIA could put a product out there and teach people to use it, but the trade isn't going to rely on it,” says Stuart Robertson, director of research at Gemworld International in Northbrook, Illinois. (Gemworld publishes The Guide, a compilation of gemstone prices developed by using specialists to research different aspects of the gem market. (Gemworld has developed its own pearl grading system that largely follows GIA's, but they also use grading materials developed by Stuller & Paspaley, South Seas pearl producers, and Pacific Pearl Colors, distributors of Tahitian pearls.) “The diamond dealers use [GIA's] grading scale, but the pearl dealers wouldn't use a pearl grading system. It would appeal to those who appraise pearls but not those in the production end of it. There are too many indications from producers that the product is too diverse to tie it into one system.”

“The system, whatever it might be,” says Asher, “needs to be different for different pearls. It can't be universal, that is, cover Akoya, freshwater pearls and South Seas. A simple ABC category -- even without pluses and minuses -- would be a good direction.” Asher believes the system currently used by GIA is too complicated to come into wide use. “Gemworld's grading formula is more reined and more user friendly,” he says. (Gemworld International's system is designed for use by their subscribers and is not proposed as a universal system.)

But certainly any pearl grading system won't be as simple as GIA's diamond grading system, or even as simple as their colored stone grading system. It will have to take into consideration the nature of the four major types of pearls on the market, and somehow it will have to address the nacre quality differences between freshwater and saltwater pearls, an argument that can be intense in the pearl world. Although producers generally agree that there are seven factors important to the quality of a pearl -- luster, surface quality, size, shape, color, nacre thickness or quality, and matching -- they do not agree on the impact each factor has on a pearl's value. The one exception seems to be luster, which everyone agrees is paramount. The importance of everything else depends on who you talk to.

Asher believes “there are ways around this by weighting [different factors].” But Robertson, who helped develop Gemworld's system, says “there is not a lot of agreement on how to weight each of those factors that go into the value of the pearl. For example, nacre thickness. You don't have the same kinds of nacre thickness on an Akoya and a Chinese freshwater pearl so there is a question of how to weight that factor in the quality grade. Same with the color. Some white pearls are whiter than others. And then there are the Tahitians. Where do black, blue, or soft gray fit into the grading as far as weighting goes? What is the percentage of value that you're going to assign to each factor?”

Asher agrees that there are problems with a weighted system. “A freshwater pearl supplier will push that nacre is everything,” he says. “And an Akoya producer may say that luster is more important. A South Seas supplier will proclaim it's both of these and more.” But what are you going to do with a freshwater pearl with excellent luster? “Are you going to add an extra 20 percent when you're talking about luster and South Seas pearls and Akoya pearls but not when you're talking about freshwater pearls?”

And then, says Robertson, there are the mabes, the abalone pearls and the conch pearls that throw any system out of whack.

Loose akoya pearls.

CONCERNS
In addition to the doubts about whether a universal pearl grading system will work, dealers have concerns about how such a system might affect their businesses and the perception of their products. Here are some of the concerns raised:

THE NUCLEATION ISSUE
One of the touchiest subjects under the pearl grading umbrella is that of nucleation. Akoya, South Sea and Tahitian pearls are all produced by inserting a bead -- usually shell -- inside a saltwater oyster. A tiny piece of mantle tissue (the part of the mollusk flesh next to the shell) from another oyster is inserted along with the bead. This piece of mantle tissue triggers the production of nacre -- nacre is the same mother-of-pearl material laid down by the oyster on the inside of its shell.

Freshwater pearls, such as were produced at one time in Japan and are now being produced in China in vast numbers, are grown inside of freshwater mussels, not oysters. They are produced by inserting only a piece of mantle tissue inside the mollusk. There is no shell bead nucleus. The mantle tissue triggers the production of nacre and a pearl grows. These products are almost always described as a “tissue nucleated” cultured pearls to differentiate them from “bead nucleated” cultured pearls.

It is terminology that Freeman feels is not wholly accurate as there is no “nucleus” left in a freshwater pearl. “Experts agree that mantle tissue is not evident within the core of either freshwater or Akoya/South Sea pearls,” says Freeman, citing articles in gemological trade journals such as G&G. He suggests that “the appropriate nomenclature should be `tissue activated' as this represents the true nature of mantle tissue usage in the creation of pearls.”

In addition, on laboratory certificates, says Freeman, “freshwater pearls are noted to have mantle tissue use, but Akoya, South Seas and Tahitian pearls have no reference to the bead nucleus nor to the fact that they also use mantle tissue for `activation.'” Bead nucleated pearls are described solely as cultured pearls. Because the pearls are nacre throughout -- a fact verified by AGTA Gem Testing Center certificate -- Freeman has branded his “gem quality non-bead nucleated `Round by Nature®' freshwater pearls with the name `PurePearl®.'” The solid nacre nature of freshwater pearls certainly doesn't put them into the same category as natural pearls -- Freeman is quite clear that they are cultured pearls, created and farmed deliberately by human beings -- but it does create a clash when developing a grading system that must take into account both saltwater, bead nucleated, and freshwater “mantle-tissue activated” pearls.

Nacre thickness is an issue not only because of the question of nucleation, there are arguments about how it affects the durability of each type of pearl. When Japanese Akoya pearls were first cultured in Japan, the oysters stayed in the water for three to six years, laying down a half millimeter (0.5 mm) to a 1.5 millimeter thick layer of nacre on the mother-of-pearl shell bead. With shorter culturing times, that layer has shrunk so that it sometimes only one-tenth millimeter (0.1 mm). Thin nacre is subject to chipping and peeling. The heavier, two to three millimeters (2 - 3 mm) thick nacre on South Seas Pearls and Tahitian pearls, it is argued, makes them more durable and, as a result, more desirable and valuable. But the same argument can be used by dealers of Chinese freshwater pearls whose product is solid nacre. Nacre thickness can be estimated by looking down the drill hole of a cultured pearl, or it can be determined by X-ray in a laboratory. (The nacre around the bead in a cultured pearl is usually not evenly distributed -- oysters aren't machines. Although oysters are turned regularly to ensure as even a distribution of nacre as possible, it may be thicker in some spots than in others. When a measurement for nacre thickness is given, it is based on the estimated average thickness.)

12.7 x 10.1 millimeter golden South Seas pearl necklace with 38 diamond rondelles and a diamond clasp totaling 9.06 carats. Courtesy of Mikimoto.

Because of durability issues with thin-nacred pearls, Moses says GIA pearl reports will “probably consider nacre thickness. There are certain thresholds that, no matter how good the luster, if a certain level of thickness is not met, the cultured pearl will suffer in durability. Tahitians don't export pearls with less than a 0.8 mm thickness. We had arrived at one millimeter as a minimum thickness as an approximate threshold for durability and beauty.” Akoyas … that have 0.1 mm of thickness -- no matter how high quality the nacre is -- have durability issues, especially around the drill hole where there can be chipping.”

PRICE
Although no one mentions it, what may make nacre thickness such a contentious issue is that natural saltwater pearls, those spontaneously generated by oysters, are also solid nacre. And natural pearls sell for many thousands of dollars more than cultured pearls. Thus if nacre thickness is part of a grading system, and grade equates to price (as it often does), would it mean a rise in prices for the freshwater pearls that are now so reasonably priced? (This would, naturally, assume that qualities of luster, overtone, surface quality, size and shape were all comparable.) And how would they affect the price of the Akoyas, South Seas, and Tahitian pearls.

When the Chinese pearls first came on the market, they were associated with “rock-bottom” price, an image that other dealers felt tarnished the image of the fineness of pearls. But that has changed. “The Chinese have learned that the world wants large, finer pearls, and are beginning to receive more respect for their product,” says Evanston, Illinois, jewelry designer Eve Alfillé. “The trade is finally accepting the new 12mm-and-over, Chinese, naturally colored pearls as worthy members of multicolored necklaces of high value -- although this may or may not be a fad.”

Freeman points to the June 2005 Mikimoto price guide for distributors that lists a stand of 9.5 -10 mm cultured pearls retailing for between $30,000 to 90,000 depending on quality. He compares this to the price of his strands of 9.5 to 10 mm round freshwater pearls that, in comparable qualities, wholesale for prices starting at $5000.

The lack of a grading system, says Alfillé, means that “only a few [consumers] are going to understand [Freeman's] quality and prices; most will be confused by large, fine, (but not as fine [as Freeman's]) Chinese pearls elsewhere at much, much lower prices.”

And it becomes even more confusing when the customer compares freshwater and saltwater round white pearls. “The price differences are incredible!,” says Alfillé. “It is very, very difficult to safeguard the price structure of Japanese Akoya pearls nowadays when, for one-fifth to one-quarter of the price you can have some very lively, lush, round white freshwaters with much, much thicker nacre and durability.”

On his last trip to China, Freeman says that he sorted through “two bushels of already pre-sorted gem-quality [freshwater] pearls [and produced] only three strands in the quality that match the roundness, color and luster of the high grade Akoya.” The difference, he says is that the pearls in his strands “were PurePearl” rather than only 10 percent maximum nacre.”

Bearing this in mind, it might be reasonable to think that a naturally round, solid nacre, cultured pearl might eventually be more valuable than a cultured pearl that gets its shape from the bead inside it, all other factors -- color, overtone, luster, etc. -- being equal.

It's not an argument that Asher buys. “In reality, the bead in a pearl is a shell and it is made of nacre and then you implant it in an oyster and more nacre is layered over it. To say that you're getting a better pearl because [the freshwater pearl] is all nacre is not enough to say that the value is or should be higher,” says Asher.

But Asher admits that, as the quality of the freshwater pearls has increased, they “have increased in value, too, although [the price of] Akoyas has largely remained unchanged.”

A selection of Chinese cultured pearl strands, widely available from virtually any bead or gem show.

PROVENANCE
Because each region produces pearls of a certain type, until recently it's been reasonably easy to distinguish between them. “A few years ago when [Chinese freshwater pearls] appeared, they were in relatively limited quantities,” says Asher. “There were some rules we could use to discern the freshwater pearls, Akoyas, and South Seas pearls from each other. Freshwater pearls were not as round, and comparing them to Akoya pearls, they were of poor quality. It was easy to separate the three categories.”

However, the market demand for larger Akoya-like pearls has created a blurring of lines. “Japanese” Akoyas are now grown in Australia and China, shipped back to Japan for processing (bleaching, polishing, dyeing and other treatments), and sold as a “product of Japan.” Even some Tahitian producers send their product to Kobe for processing, says Robertson. South Seas pearls are getting smaller to fit the 9 to 10 mm market while Chinese Akoyas are getting larger to meet that same market. “Size and nacre thickness are no longer a foolproof system to differentiate between the two,” says Robertson. Making things even more difficult, South Seas pearls, Akoyas and freshwater pearls are being mixed in the same strands.

Because warmer water is associated with thicker nacre platelets, which may be associated with less luster, Berger says some Vietnamese producers of saltwater, bead-nucleated pearls, in order to achieve the fine luster of Japanese Akoyas, ship their pearl-laden oysters north to colder Japanese water for “finishing.” The colder water produces “a different consistency of the aragonite layers, and a harder finish on the outer skin” says Berger. This translates into a better luster and a more marketable pearl. And more confusion. In fact, provenance, or the origin of the pearls, is becoming a “very tricky subject,” says Robertson.

One reason GIA is delaying release of its grading system, says Moses, is that they want to be sure of their identification techniques. “At least now, we want to separate [the pearls] into species as it's being done in the market place,” says Moses. “There is a significant price difference [between pearl categories]. We feel that [identification] is something we should do.”

But Karin Hurwit, who retired after 32 years in the GIA lab, and who describes herself as a pearl enthusiast, questions the emphasis on provenance. She compares pearls to other colored stones, and place names that have long been associated with certain of them, such as Columbian emerald or Burmese ruby. “A beautiful stone from somewhere else that had the color and all the attributes [of a Burmese ruby] would be downgraded or priced less because it didn't come from a certain locality.” She believes a gem should be graded and valued for its characteristics, regardless of its origin.

MARKET EDGE
Blurring lines between the pearl categories might, to an outsider, appear to make the grading issue easier, at least for Akoyas -- after all a pearl is a pearl is a pearl, so why not judge them on their merits, as Hurwit suggests. That not the way it looks to the producers.

“The pearl industry has actually fought against [a universal pearl grading system],” says Robertson. “And I understand why. Look at what happened to the diamond trade. In the opinion of some, a single diamond standard [GIA's] has contributed to the decline of the margins on diamonds. It's easy to trade them over the internet.”

“Marea” necklace, the 3rd prize Tahitian Pearl Trophy for 2005, designed by Donatella Pozzobon and sponsored by Gioielli Donati.

“People are cautious because they are afraid we might lose an edge as we have with diamonds,” agrees Asher. “Pearls are somewhat more of a blind product.” Yet he says he believes a grading system could be “beneficial [to the pearl industry] … Pearls do not have the clout that metals or diamonds have,” he says; both diamonds and metals have standards the retail consumer can easily understand.

But on the other hand, dealers express some concerns that a standardized pearl grading system will lead to a kind of “Rap” sheet for pearls, and that they may lose their edge in marketing. But Robertson points out that “diamonds are standardized, yet we accept completely that a fancy yellow diamond is much different from an H-colored diamond, it is much more rare and more expensive.” Asher agrees, saying, that “in general the Rap sheet is used in a positive way. Everyone knows that the Rap sheet shows a range. It's not an end-all to what the value should be.”

CONSISTENCY
Dealers are also wary of the difficulty of grading pearls, and the errors in grading that could occur if it's done by those who do not work with pearls every day. Although GIA's diamond grading record is exemplary, there have been newsworthy events in which the same stone was issued two different reports. These events have been newsworthy, of course, because despite the thousands of diamonds graded by GIA each year, these events are rare. But, it still concerns pearl dealers who feel there can be something mysterious and elusive about the high quality pearl. “Grading of any type is not universal,” says Asher. “You can give a diamond to the same lab two different times, and sometimes get a different grading. If it happens with diamonds, it will happen even more with pearls. The problem is that something that has a qualitative aspect to it can not be boiled down to a quantifiable list [of characteristics].”

TREATMENT
Finally, there is the question of treatment. And there is lots of treatment.

Separating treated from untreated pearls is “not critical if you're dealing with Akoyas, where virtually every sample has gone through processing,” says Moses. “But if you now take something like South Seas pearls that only go through cleaning and polishing, and you start applying these treatments and enhance them, then a fair amount of detection and disclosure is very important because you have a product that is competing with a naturally colored pearl.”

“The processing of pearls is the most carefully guarded secret,” says Moses. “It's done mainly in Japan and they have not exported that intelligence.” However, Japanese pearl firms have been “exporting their skills and using them on other products.” This is why, explains Moses that GIA is “working very hard to strengthen our identification process. We want to feel we have a good handle on that. We have identification criteria for many of these treatments.”

“There is so much finagling these days,” says Fred Ward, author of the book, Pearls. “It's getting harder and harder to find a pearl that hasn't been treated.” The Akoyas are universally bleached, dyed, coated, or irradiated and have been for years. Although Freeman says high-end Chinese freshwater pearls are not treated, some of the commercial grade are bleached and dyed. The websites for Paspaley Pearls and Perles de Tahiti, both say the producers do not treat or enhance their pearls. However, notes Ward, that doesn't mean that South Seas or Tahitians are not treated. Ward says that one Australian company told him the pearls they were harvesting off the Australian shores “were pure, only nucleated.” They claimed this, he says, while “I was standing in a room where they were tumbling pearls with walnut shells -- not abrasive enough to damage the pearls but hard enough to take off anything that might be on the surface and make [the pearls] shinier.” And as Robertson noted, some Tahitian producers send their pearls to Kobe for processing.

Processing is not done “to mislead anybody,” says Robertson, but to improve the appearance of the product. However, pearl treatment is rarely disclosed at the counter, and without disclosure to the consumer, eventually someone could decide that it is misleading.

And where does a treated pearl fit into a grading system, asks Hurwit, “What good is a universal grading system on polished items? Do you want to grade treated pearls? Do you want to grade treated diamonds?”

15 millimeter South Seas pearl set with 1/2 carat weight diamond line shoulders on an 18K white gold multi-strand beaded chain. By Stuller and Paspaley.

EDUCATION AND SALES
With the popularity of pearls at a high point, and with the huge range of qualities, people who never had the opportunity to buy pearls before are buying them now. In fact, Tiffany's is riding the wave by introducing their one-product store, Iridesse. But this multiplicity of pearls, says Alfillé, has created “Total confusion in the public's mind. You would think that someone would at least attempt to put some order into this.”

It's not only the public who lack information about pearls. “I have seen dreadful strands of Akoya-type product at Lord and Taylor -- skim milk looks better -- in the same case as Mikimoto high-middle grade strands,” says Alfillé. “True, the price was promotional, $220 for a 6 mm 18-inch necklace, but when I did my mystery shopper thing, not one of the staff could describe or explain any difference in the quality.”

While Alfillé is a highly educated “shopper,” there are consumers out there who might buy given the right information, but who are put off when they see a $50 strand of faux pearls, a $200 strand of freshwater pearls, and a $2000 strand of freshwater pearls that look about the same. “I hear -- and I believe -- that customers often leave a jewelry store with a non-pearl item when they originally wanted pearls,” says Asher, “because they just don't have the confidence [in the product]. Any grading system would give them confidence.”

“What exists now,” he says, “are … not even grading systems. Everyone has their own. Even when two companies use the same lettering or numbering system, it may not mean the same thing, and the customer can see distinct difference in [pearls of the same grade]. It's difficult to compare [pearls from one store and another] based on the `grading system'.”

Alfillé feels that a universal grading system would start to give customers the confidence to buy pearls. “I was struck with how the DTC [Diamond Trading Company] gave the public a feeling that they `knew' diamonds -- the 4Cs comes to mind -- and spent a fortune in the process, yet no one was doing this for pearls.” So in 1990, Alfillé founded The Pearl Society. “My mandate was to have honest information go to all. Our speakers were encouraged to divulge trade `secrets,' methods of manufacture, mabe's, for instance. This displeased many retailers, who felt the public would not buy pearls with too much of this information.”

The opposite turned out to be true. The Pearl Society “has proved more successful than you can imagine. What transpired is that these consumers eventually became collectors, and in some cases even vie with each other to be the first to collect new types of pearls. The Pearl Society meetings give them a forum to compare their acquisitions, and they have become ardent proselytizers, feeling fully capable to discern quality, and to make informed choices, and at times, to also collect such things as dyed freshwaters, or pearls of mere `fashion jewelry' grade.” And while the GIA diamond grading system can be misunderstood and misused, it does gives the consumer confidence in buying diamonds. So, why not with pearls?

Despite the fact that Robertson uses and helped develop Gemworld's pearl grading system, he wonders if, rather than educating the public, emphasis on grading can end up blinding them. “You can argue that by standardizing grading, people aren't selling the product, but selling the paper from different organizations. They're too involved in selling the paper and not seeing the product. If the retailer and the consumer use their eyes, handle the product, and look at it, whether it's a pearl or a fine gemstone … and not worry about what some piece of paper says about it, it would become easier to sell these products again. It would be easier to sell the romance that gemstones have represented through the centuries. It's too hard to tie in the emotional connection if you're trying to sell the paper on the Internet.”

Of those who are more interested in buying by price than by quality, he says, “There are always people who are looking to harvest the low-hanging fruit. They don't get to experience the better product, and experience what the industry has to offer in the way of jewelry.”

So yes and no, back and forth, the pearl grading discussion goes. And where it will end, well, as yet, no one knows.

For a concise, readable account of pearls and their history, see Fred Ward's Pearls, (available from the author at www.fredwardgems.com); for general discussions about the volatile pearl market see “China's Amazing new Pearls” by Fred Ward (LJ, April, 2000); “Today's Pearls” by Fred Ward (LJ, January, 2002); “The Big Optimistic” by Gary Roskin (JCK, October, 2005).