While there is a slowdown being witnessed in the mined diamond sector, Lab-grown diamonds are taking the market by storm. With major unprecedented developments 2018 went down the history as the year of Lab-grown diamonds. 2019 seems to hold even more surprises in store.
Indian exports of Lab-grown diamond jewelry to US, currently estimated at $ 280 million this year, are expected to capture 2 percent of overall exports of gems and jewelry to US. On the other hand, with rising popularity of Lab-grown diamonds among the middle class, demand for Lab-grown diamonds in India is expected to double this year.
With price difference between mined diamonds and Lab-grown diamonds going as high as 75 percent in some cases, middle class families are looking to own a cheaper or bigger stone at same price. Gary Ingram – CEO of TheDiamondStore.co.uk recently shared two pictures of identical diamond rings – one a Lab-grown diamond and other a mined diamond, with no difference except for the Lab-grown one being £ 500 cheaper. This price difference can go to as high as 90 percent within 5 years according to NY-based diamond analyst Paul Ziminsky. Such cases are prompting the young savvy buyers to go for Lab-grown diamonds.
This industry scenario is pushing mined diamond players also to dip their toe in Lab-grown diamond waters. The latest executive to join the bandwagon is Toby Cruse who worked with De Beers for almost two decades and will now join Diamond Foundry as its new VP – Strategic Sales, after a six-months cooling off period.
The changing dynamics of the industry is scaring off some people, though uncalled for. In India’s traditional Surat and Mumbai market, where businesses in the diamond pipeline have been used to do conduct business the way dictated by diamond oligopoly, a new order of things come as a shock. Where some vested interests have vehemently opposed Lab-grown diamonds by all means, for the first time a Lab-grown diamond and jewelry exhibition is being organized in Mumbai with more than 70 exhibitors participating including 15 from Surat itself.
Aniruddha Lidbide, a diamond industry analyst says “Alarm bells have started ringing for natural diamond industry with the first-ever exhibition of lab-grown diamond jewellery being held in Mumbai. The lab-grown diamonds will eat away the natural diamond industry in the next few years. Many diamond manufacturers in Surat have shifted to making lab-grown diamonds.”
However, amid the commotion it is not India but China who is taking the pie of the rapidly growing Lab-grown diamond sector. Over the years China has silently developed the know-how and established large-scale Lab-grown diamond manufacturing facilities. Though primarily used for industrial diamonds, China now makes 56 percent of the world’s gem quality Lab-grown diamonds, thus outpacing the second-placed India that contributes to only 15 percent of the global Lab-grown diamond production.
According to Paul Ziminsky, interviewed by Yahoo News, Lab-grown diamonds currently accounts for only 3.5 percent of world’s diamond jewelry, this share could grow to 6 percent or even more within next 4 years.
Ziminsky says “Few years Chinese producers had been upgrading existing equipment to produce larger, better-quality synthetic diamonds for use as jewelry. China already has the infrastructure in place which allows for high production scalability of higher-quality synthetic diamonds, as existing high-pressure high-temperature equipment is upgraded.”
This is also the reason why Guangzhou Diamond Exchange too is going to promote Lab-grown diamonds. Apart from pricing, sustainability and conflict-free had been the other major drivers for rising acceptance of Lab-grown diamonds worldwide. Henan Province, China-based Lab-grown diamond manufacturer – Huanghe Whirlwind International also uses these factors as part of its pitch.