Why Lab Diamond Sales Are Growing

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Not that you know the difference. Artificial diamonds look the same as natural diamonds. The only noticeable difference is the price.

“The result is truly breathtaking,” said Edahn Golan, an independent diamond industry analyst.

He said the March data showed the number of engagement rings sold that featured a manufactured The diamond jumped 63% from a year ago, while the number of engagement rings sold with a natural diamond fell 25% over the same period.

Going back month-to-month, in February, the data showed that the number of rings sold with lab-grown diamonds that month increased again, 80% from the previous year, while the number dropped by 13% for natural diamond engagement rings.

“The big fear in the natural diamond industry is that consumers are starting to accept lab-grown diamonds in engagement rings,” he said. Too late. “It’s happening.”

The tide is changing

Why are consumers flocking to synthetic diamonds? Cost is the most obvious reason. The average retail price for the most popular one-carat round synthetic diamond for an engagement ring in March was $2,318, Golan said.

“That’s significantly less — up to 73% cheaper — than a natural diamond of the same size, cut and clarity as a man-made diamond, which would cost $8,740,” he said. Additionally, the lower cost allows couples to purchase a larger stone.

“A lab-grown diamond is a real diamond, but it may have taken a few weeks to make,” Golan said. “Natural diamonds formed 800 million to three billion years ago and their supply is not endless.”

This makes natural diamonds a little more expensive, and prices are likely to rise as Russia’s invasion of Ukraine has tightened the supply chain for natural rough diamonds.

The sanctions directly target Alrosa, partly owned by the Russian government, which the US government has identified as the world’s largest diamond mining company, accounting for 28% of global diamond production.

Synthetic diamonds are also becoming popular as consumers become more aware and educated about them, said Dan Moran, a third-generation diamond expert and owner of Los Angeles-based luxury jeweler Concierge Diamonds. Moran said the typical buyer of man-made diamonds is usually under 40. and very budget conscious.

Mined diamonds have a controversial history linked to the use of child labor in some African diamond mines as well as the sale of illegally traded “conflict diamonds” that fund conflict in war-torn areas.
Among millennials and Gen Z, their eco-conscious mindset and ethical concerns about sourcing natural diamonds is another factor influencing their preference for non-traditional engagement rings, according to a report by the planning website. wedding dress The Knot.

Small but growing share of the diamond market

Although its share is increasing, the market share of synthetic diamonds remains relatively low.

Currently, about 7% of the specialty diamond jewelry market is represented by man-made diamonds, up from 3% in 2020, Golan said.

Some major jewelry retailers are trying to mainstream man-made diamonds. In 2021, the largest jewelry company in the world, pandora (PANDY)made a major change by announcing that it would stop using mined diamonds and replace lab-created diamonds in its jewelry.

Pandora said it was instituting the change as part of an effort to sell sustainable jewelry, and also because consumers were increasingly demanding it.

Seal, (GIS) The largest jewelry company in the United States (which owns the Zales, Kay Jewelers and Jared chains) highlighted the popularity of lab-grown diamond jewelry during its March earnings call with analysts.
This engagement ring from Concierge Diamonds has a 1 ct lab grown diamond with 2 pink sapphires in a 14k yellow gold band.  (Prices start at $3,500 depending on center diamond)

Calling it a “fast-growing category” in her jewelry portfolio, Signet CEO Virginia Drosos told analysts that lab-created diamonds are among the big jewelry trends she expects this year.

The company said it has expanded its selection of man-made bridal jewelry at its Zales and Kay Jewelers stores in response to the increase request.

High jewelry brand Charles and Colvard, which makes lab-created diamonds, said consumers don’t just want to look good in the jewelry they wear, they also want to feel good about it.

“As the momentum of conscious consumerism grows, the rise of lab-grown diamonds is not surprising,” said Don O’Connell, president and CEO of Charles & Colvard. “[Consumers] want to know the origin of their stones and be reassured that they are not in conflict. They accept the choice to buy a piece of high jewelry that corresponds to their values.”

The VRAI lab-grown diamond brand said the pandemic has also sparked attention and action towards social and environmental issues. He said consumers are more thoughtful and reassessing their shopping habits, and the businesses and industries they support.

There is, however, an important consideration for anyone buying lab-created diamonds: man-made diamonds have little resale value.

So while you might not be able to tell a natural diamond from a factory-made variety, someone with a trained eye can, Golan said. Once a stone is identified as a factory diamond, even if you paid a lot less for it, you won’t get much either.

But the value of a ring is not only monetary.

“As an industry professional, people ask me all the time what I think of a ring they have,” said Moran, of Concierge Jewelers. “I always say, if you love it, be happy about it. An engagement ring is a symbol of commitment and lasting love.”

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