Jeweller - July 2022

LAB-CREATED DIAMOND REPORT | The Perfect Storm
CHART A: LAB-CREATED DIAMOND PRICE RELATIVE TO NATURAL
PRICE DIFFERENTIAL BY POLISHED SIZES AT RETAIL
All diamonds sampled in Zimnisky's research were round in shape, VS in clarity,
F-H in colour, very good toideal cut with low fluorescence. Diamond prices were
based on average survey of prices of generic loose stones by size category
sampled from prominent diamond retailers.
Source: PaulZimnisky.com, 2020
This was an issue also raised by the founder of Holloway
Diamonds, Garry Holloway, who outlined the potentially
dramatic change in the market in the years to come.
“Two years ago we added ‘only natural’ to our logo. I think at
present, people are being ripped off,” Holloway says.
“Jewellers should only take [lab-grown] consignment goods as
prices will tip upside down in a year or two to almost nothing.
“Larger lab-grown diamonds cost less per carat to grow and
polish than smaller lab-grown diamonds. A natural diamond
of twice the weight costs four times more.
With India feeling the pinch more than most, it
should come as no surprise that the industry’s
movers and shakers have been quick to get on the
front foot in search of a solution.
“The GIA charges $399 to grade a four-carat diamond and
$5,700 to grade 75 half-carat diamonds! It does my head
in working out how much different weights should cost,
but clearly, the four-carat should cost a lot less per carat
than half-carats. Competition in the market will sort this
out over time,” Holloway explains.
He says that the word around the diamond trade is that
smaller than half carat lab-grown diamonds are in short
supply.
Holloway adds, “Trusted brands will guarantee minimum
quality standards, as De Beers has largely done with
Lightbox LGDs.
“That will cut out lab grading or a third of costs. Over time
giving a lab-grown diamond as a special gift will cost less
than Moissanite did while they were under patent.
But lab-grown diamonds will establish a strong self-purchase
market and when some people decide to go for the real thing
their size expectations will be through the roof!"
Not all retailers are as sharply divided. With a workshop
and showroom located in Brisbane, Paula Walden, of Paula
Walden Fine Jewellery, says she has observed an intriguing
rise in interest from customers, however, she also says time
will tell as to the staying power of lab-grown products.
“There has definitely been an increase in interest, I would say
three out of every five engagement ring sales would account
for a lab-grown diamond,” Walden shares.
“Considered ’smart value’ and the sustainable option of
being not ‘mined', I believe customers prioritise the benefit
of receiving a better quality – in terms of colour and clarity –
Industry Insight
Paul Zimnisky
PZ Diamond Analytics
“I certainly think lab-grown
diamonds will benefit from the
sanctions on Russian diamonds,
which is limiting the supply of
natural diamonds. However,
supply chain disruptions,
related to lockdowns in China,
could result in limited labdiamond
supply as well."”
Kerryn Hasler
Ecali Fine Jewellery
“The market seems to be
the younger generation who
are open to the idea of the
diamonds being created
in a laboratory. The older
generation can’t get their heads
around the fact that diamonds
can be grown in a lab.
Garry Holloway
Holloway Diamonds
“Over time giving a lab-grown
diamond as a special gift will
cost less than Moissanite did
while they were under patent.
But lab-grown diamonds
will establish a strong selfpurchase
market and when
some people decide to go
for the real thing their size
expectations will be through
the roof!”
stone that is also larger.
“On a personal level, I don’t know if lab-grown diamonds
are that sustainable. The energy to produce lab-growns is
significant, however, these are just my assumptions.
“When it comes to manufacturing, from a trade perspective,
the margin is still greater from a natural.”
Regardless of where one stands on the topic of lab-grown
diamonds, there’s one fact on which most people agree – the
manufacturing capabilities are improving and the results are
beginning to show.
Indian company Ethereal Green Diamond has, within the
past month, created a record-breaking 30.18-carat emeraldcut
lab-grown diamond, surpassing a world record set by
Greenlab, another Indian synthetic diamond producer.
Dubbed the Pride of India, the lab-grown diamond was
graded H colour, VS2 quality, and certified by the International
Gemmological Institute. The diamond was produced in four
weeks using the chemical vapour deposition process.
Greenlab’s 27.27-carat diamond was a marquise stepcut
diamond, named Om. The IGI graded two additional
lab-grown submissions by Greenlab, including Shivaya, an
emerald-cut diamond weighing 20.24 carats, and Namah,
a pear rose-cut, 15.16-carat polished.
Previously, the largest known polished CVD diamond was a
princess-cut, 16.41-carat, G-color, VVS2-clarity stone created
by Shanghai Zhengshi Technology. The Gemological Institute
of America (GIA) graded that diamond in January of this year.
With a handful of factors in mind, 2022 may well have
handed a free pass to the lab-grown diamond suppliers to
capture a larger slice of the jewellery market; however, it
will be some time before we know whether it transpired
into a longer-term trend.
Alrosa is excluded from the international marketplace
for an indeterminate period of time, and De Beers has
made it clear that it will be unable to significantly improve
supply but these are industry issues that will eventually
be resolved. Further, problems in the natural diamond
supply chain doesn’t mean that consumers automatically
purchase the man-made product.
In addition, it’s clear that for some retailers, these problems
do not mean they will stock lab-grown diamonds in preference
to natural stones.
That said, with manufacturing capabilities continuing to
improve, along with an increasing number of customers
indicating that they will embrace lab-grown diamonds – albeit
off a low base – a portion of the supply shortfall will be filled
by lab-grown diamonds, but the market at the retail and
consumer levels will remain divided.
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