It’s been a while since I wrote about lab grown diamonds and a lot has been happening in the trade.
In 2023, lab grown diamonds represented 17 percent of the global diamond market but now these high tech alternatives to natural diamonds account for 43.5% of all engagement rings sold in the USA in the first quarter of 2024 and 57% of loose diamond sales. Lab grown diamonds are here to stay, much to the annoyance of the natural diamond industry.
The popularity of lab grown alternatives to natural diamonds has created serious problems for natural diamond dealers. Luxury brands are not investing in new diamonds because they are not selling as much of their existing stock that they are holding and mining companies are reluctant to put the investment needed into their companies because demand for natural diamonds is falling. Headlines this week have announced that Anglo America, who own 85% of De Beers, the remainder being owned by the government of Botswana, are selling off the world's best known diamond mining company. Not only that, but they are getting out of diamond mining, coal mining and platinum mining. It seems that big changes are coming.
De Beers have in recent years entered into the lab grown diamond market. They manufacture their own lab grown diamonds under a brand called Lightbox. They believe that if lab grown diamonds can fall low enough in price, people will no longer want them and there will be a revival of demand for the more expensive mined product.
I’m not sure they have predicted the market correctly. In the past, people have wanted to spend more money on natural diamonds instead of cubic zirconia, but lab diamonds are not an imitation stone. They have the same chemical structure, hardness and refractive index that natural diamonds have. To tell the difference between a lab grown diamond and a mined diamond, you need specialist equipment. There is no difference to the naked eye, nor to how the stone will wear over time.
If the natural diamond industry is the loser in this battle, the winner is the consumer. The efforts by the industry to bring the prices of LGD down has increased demand and with increased demand, more companies have invested in the LGD market. Some reports claim that there are now over 50,000 machines producing LGD around the world.
Far from putting consumers off, the fall in price of lab grown diamonds has been lauded as democratizing diamonds and putting gemstones above a carat within the reach of the average shopper.
New technology is appearing that allows companies to create these diamonds faster and for less cost. This means that prices have come down but not all lab grown diamonds are created equal. Jason Payne, CEO of Ada Diamonds says that in the beginning, lab diamond growers sought to create super high-purity crystals that rivalled some of the best natural diamonds but that in the last few years, aspirational players entered the market without the expertise of the original companies and that they are using disadvantaged technology. Fuelled by a desire to create as much as possible as fast as possible, some LGD are streaky and blurry. Payne explains that the seed which the diamond forms from determines the quality of the lab grown diamond and that a seed deteriorates with each use. Growers who use the same seed over and over are able to produce more LGDs for less cost but that are inferior in quality.
At the other end of the LGD market there are companies who are not reducing their prices at all and who are focussing on producing high quality stones which they can sell at a premium due to their branding. These companies are focusing on creating high quality LGDs using natural energy sources to power their equipment and are making their stones in the UK or USA.
I think for consumers to get the best value for money and a great lab grown diamond, they should buy from a company that they know and trust. Just like natural diamonds, LGD prices vary depending on the quality and size of the stone.
Lab grown diamonds are possibly the most exciting thing to happen to the jewellery trade in my lifetime and I feel they have moved the jewellery industry into the 21st Century, combining new technology with traditional cutting skills and providing consumers with a product that offers an alternative to mining which has hugely negative impacts on the environment. The challenge for our generations, as the world’s population continues to increase, is how we learn to do more with less and I think lab grown diamonds are the solution for the future of sustainable jewellery.