Over the last 5 years we have seen an increasing number of people choosing lab-grown diamonds over natural stones. There’s no question that lab-created gems are disrupting the diamond industry. Our question is: is this just a short-term trend or is it a fundamental change in peoples’ attitudes to diamonds?
The magic of diamonds has traditionally been attributed to their rarity. Lab-grown diamonds may be almost identical to the real thing, but they lack the history, and in some ways that may be a good thing.
According to The Economist, the market for lab created diamonds is growing by over 15% a year and it looks like this will only accelerate. Advancements in technology, the production process and the product itself, has mean that supply is increasing rapidly. As it does so, prices will continue to drop.
Lab-grown diamonds offer customers a choice of gem that they know is 100% conflict-free and environmentally friendly for a lower price than mined diamonds – it sounds like it should be a no-brainer.
The Ethical Landscape
Many customers are flocking to these stones prioritizing ethics over luxury. Lab-grown diamonds have almost identical physical qualities to a mined stone, but a much different origin. While the situation is nuanced, there is no doubt that diamonds have a complicated history and there have been incidences of violence and exploitation related to their production.
There are a variety of factors changing prices of lab created diamonds, but these changes are decreasing the purchasing cost. Since 2016, the production cost of lab-grown gems has decreased. They can be purchased for 40-50% of the cost of a natural diamond and this appears to be continuing to fall.
With a name made famous by the 2001 film, a ‘blood’ diamond is an illegally traded gem used to fund war and violence. For years, they have financed violence in a variety of under-developed nations.
These human-made stones are guaranteed conflict-free. On the flip side, diamond mining is a profession that employs countless people across the globe.
The lab-grown diamond industry has marketed itself with environmental values. The production process undoubtedly has a much smaller carbon footprint. Mining requires heavy machinery, explosives, hydraulic equipment, and other harsh tools used to dig up the land. Lab-grown diamonds emit less carbon and sulfur oxide.
Initially, consumers were willing to pay a premium price for the perceived ethical and environmental benefits of a lab-grown diamond.
More lab-grown diamonds are being produced today because technology is becoming more available and accessible.
One critical note is that many market leaders in synthetic diamond production also have large diamond mines. One example is DeBeers. This diamond conglomerate was responsible for the ‘A diamond is forever” advertising campaign.
The company now has a synthetic diamond lab called LightBox. According to the chief executive officer, Bruce Cleaver, this affordable fashion jewelry “may not be forever, but is perfect for right now.”
Whether big players in the diamond industry will move from mines to labs is uncertain. It will be interesting to see what the future holds for these precious gems.
The Future of This Industry
Conscious consumerism is the new trend. We are happy that more people are looking to purchase products that are conflict-free and eco-friendly.
Traditionally mined natural diamonds have a complicated history with human rights and the environment. It wouldn’t be surprising if they lose value as consumers become more aware of alternatives to a girl’s best friend.