Experts talk about a dangerous trend in the gemstone market

Export of lab-grown diamonds raises criticism from experts

Man-made gemstones are disrupting the $89 billion global diamond jewelry market. Diamonds sparkle the same, but there are key differences: mined natural gemstones are over a billion years old, while lab-made stones are new and cost less than half the price.

Man-made gemstones are changing the $89 billion global diamond jewelry market, especially in the western Indian city of Surat, where 90 percent of the world’s diamonds are cut and polished.

“Once a customer sees it with their own eyes, they are sold. I believe this is the future,” explains Greenlab Diamonds director Patel. It takes his team less than eight weeks to produce a diamond that is virtually indistinguishable from a mined gemstone.

Exports of lab-grown diamonds from India rose 25 percent between April and October 2023, up from 15 percent in the same period a year earlier, according to the latest industry data. Reactors in laboratories such as Patel’s are filled with carbon-containing gases such as methane, and the crystal grows under heat and pressure. The rough diamonds are then transported to another facility where hundreds of workers design, cut and polish the stones.

The global lab-grown gemstone market share by value has risen from 3.5 percent in 2018 to 18.5 percent in 2023, New York-based industry analyst Paul Zimnisky told AFP, and is likely to exceed 20 percent. in 2024. According to the expert, this has increased pressure on the industry, already suffering from geopolitical turmoil and falling demand.

Machine-made diamonds were first developed in the early 1950s, but less than a decade ago it took a technological leap to create a commercially viable process.

Manufacturers say their gemstones are produced at a lower carbon cost, although there are questions about whether the energy-intensive process is better for the environment.

Patel explained that his lab uses solar energy from the local grid, although others get their electricity from high-carbon sources.

In February 2023, 17 percent of diamond engagement rings sold in the United States, the world’s largest consumer of natural stones, used lab-grown gemstones, according to industry analyst Edan Golan. Golan estimates the figure is now 36 percent. This is made possible in part by hundreds of companies in China and India that are among the largest manufacturers of artificial stones

Indian lab-grown diamond producers exported 4.04 million carats between April and October 2023, up 42 percent year-on-year, according to the Indian Gem and Jewelery Export Promotion Council.

Ajesh Mehta of D.Navinchandra Exports, whose group is one of the official buyers of global diamond giant De Beers Group, admitted that the Covid-19 pandemic was responsible for the worst downturn in his 30-year career.

Retailers in Surat told AFP that the price of a lower-quality one-carat polished stone has fallen from $2,400 in 2022 to just over $1,000 in 2023.

The second largest American manufacturer of artificial stones, WD Lab Grown Diamonds, declared bankruptcy in October 2023. But Patel argues that falling prices will boost demand.

“We knew that prices would go down because there is no monopoly in this industry,” he emphasizes.